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close this bookAgricultural and rural development policy in Latin America. New directions and new challenges. (FAO Agricultural Policy and Economic Development Series - 2) (1997)
close this folderIII. The Evolution of Agricultural Policy
close this folder6. Irrigation
View the document6.1. Policy Reforms
View the document6.2. Transitional Issues
View the document6.3. New Market Compatible Polices

6.1. Policy Reforms

Recent policy reforms designed to reduce the fiscal burden of irrigation systems and to increase the efficiency of these systems include: (i) lowering subsidies and raising user fees to cover operation and management costs; (ii) decentralizing the management of irrigation systems and in some cases transferring (devolution) the management and even the ownership of the projects to water users; and (iii) developing the use of water markets. Governments have reduced budgets for the construction of new irrigation projects, and current policies emphasize the rehabilitation and consolidation of existing facilities. New projects now face stricter economic criteria in evaluating their feasibility, and smaller projects are given preference over larger ones.

In Colombia, Law 41 of 1993 emphasized both efficiency and equity criteria in irrigation project construction. The law mandates community participation in project design, access by small farmers, and requires that 100% of operation and maintenance costs be recovered by users. HIMAT's role was redefined to be more in technical assistance rather than administration. In Mexico, expansion of irrigated land slowed and even became negative in the early 1990's. Slow growth was caused by reduced government expenditures on new irrigation projects that fell from US$ 3,600 million in 1981 to $230 million in 1990. Water policy reforms have: (i) raised the costs of water to producers in public irrigation districts, with users paying an estimated 83% of costs in 1992 compared to 18% in 1988; (ii) decentralized water management units and begun to transfer irrigation districts to water users' organizations; (iii) enacted stricter economic criteria for new project appraisal and emphasized rehabilitation and consolidation of existing facilities over new construction; and (iv) changed the national water law to permit the development of water markets. The New Water Law of 1992 makes it legal to lease or sell water separate from land. In Peru, the Agricultural Investment Promotion Law of 1991 began the process of transferring the management and operation of public irrigation projects to user groups, and set water tariffs for full cost recovery of operation and maintenance.