Innovating in a dynamic technical context - Water Scarcity, Livelihoods and Food Security - page 111

project PN12 were included in a government subsidy program for farm
equipment (CIMMYT, 2010). These are among many examples.

An example from the Andes
An example of the tight interrelationships among policies, institutions and
technologies comes from the Andes. The Andes basins that flow from east to
west are short and steep. There are the usual upstream-downstream exter-
nalities that affect different groups with different interests in different ways
(Box 5.5).
Everyone could be better off if institutional mechanisms were established to
share water-related benefits and costs. Benefit-sharing mechanisms (BSMs) can
generate funds from downstream water users to encourage upstream land and
water management practices with positive externalities (and discourage
practices with negative externalities). BSMs can provide incentives to use
improved technical practices such as replacement of intensive hillside tillage
with no-till agriculture, introduce tree crops and many others.
In these instances, technical innovation depends on incentives made available
through institutional change, for example trust funds for highland investment
and incentives. BSMs are pointless if they are not directed towards technologies
that improve or maintain water quality and reliable water flow to downstream
users. The policy context is also favorable as national policies in many Andean
countries give high priority to maintenance of alpine ecosystem services, and
to reduce poverty in highland communities.
CPWF, together with the Centro Internacional de Agricultura Tropical
(CIAT), the Consortio para del Desarrollo Sonstenible de la Ecoregión Andina
(CONDESAN), and other partners, has played key research and engagement
roles since 2005 in the development of several BSMs (PN22, Andes 1, Andes
2, Andes 3 and Andes 4) (Estrada et al., 2009; Johnson et al., 2009; Quintero
et al., 2009; Escobar and Estrada, 2011; CPWF, 2012f ).

Box 5.5 Wants of different groups with different interests
in the Andes

• Downstream urban dwellers want clean, reliable water supplies.

• Lowland farmers want cheap, reliable irrigation water of suitable

quality.

• Midstream hydropower companies want reliable water with low silt

content.

• Sports enterprises want clean reliable year-round water.

• Upstream highland communities want improved livelihoods.

• Civil society in general wants to maintain important highland

ecosystem services and environmental flows.