Utkur Djanibekov

Prospects of Agricultural Water Service Fees in the Irrigated Drylands Downstream of Amudarya

The limited availability of surface water, low water use efficiencies, a deteriorating irrigation network and land degradation aggravated by the impact of climate change are among the factors constraining agricultural production in the irrigated drylands of Central Asia. Recurrently, an introduction of water service fees has been suggested as one option to increase water use efficiency, which is analyzed here at the example of the downstream Amudarya Khorezm region, Uzbekistan. Underlying issues in introducing fees for water services in irrigated dryland agriculture given the state procurement policy are in Uzbekistan of crucial importance. Therefore, the impacts of different levels of water service fees were simulated with a mathematical programming model. The analysis and conclusions are based on changes in regional welfare, cropping pattern, export structure and economic attractiveness of crops to agricultural producers. Although the conclusions refer to the case study region, they help understanding the potential impact of water service fees on the national agricultural sector and add to the discussions on where opportunities for a (partial) cost recovery for the operation and maintenance of the irrigation system of Central Asian countries may exist. It is argued that the introduction of water service fees may indeed generate sufficient funds to recover costs for operation and maintenance of the irrigation network. However, as the current institutional setup constrains a significant reduction of agricultural water demand, the introduction of water service fees as an isolated measure is not likely to achieve the expected benefits unless flanked by additional measures such as reduction of the state production targets on crops.

Economics of Land Degradation in Central Asia

Land degradation is a major development challenge in Central Asia, with negative implications on rural livelihoods and food security. We estimate the annual cost of land degradation in the region due to land use and cover change between 2001 and 2009 to be about 6 billion USD, most of which due to rangeland degradation (4.6 billion USD), followed by desertification (0.8 billion USD), deforestation (0.3 billion USD) and abandonment of croplands (0.1 billion USD). The costs of action against land degradation are found to be lower than the costs of inaction in Central Asia by 5 times over a 30-year horizon, meaning that each dollar spent on addressing land degradation is likely to have about 5 dollars of returns. This is a very strong economic justification favoring action versus inaction against land degradation. Specifically, the costs of action were found to equal about 53 billion USD over a 30-year horizon, whereas if nothing is done, the resulting losses may equal almost 288 billion USD during the same period. Better access to markets, extension services, secure land tenure, and livestock ownership among smallholder crop producers are found to be major drivers of SLM adoptions.

Market-based instruments for risk-averse farmers: rubber agroforest conservation in Jambi Province, Indonesia

This paper investigates the effectiveness of different market-based instruments (MBIs), such as eco-certification premiums, carbon payments, Pigovian taxes and their combination, to address the conversion of agroforests to monoculture systems and subsequent effects on incomes of risk-averse farmers under income uncertainty in Indonesia. For these, the authors develop a farm-level dynamic mean-variance model combined with a real options approach. Findings show that the conservation of agroforest is responsive to the risk-aversion level of farmers: the greater the level of risk aversion, the greater is the conserved area of agroforest. However, for all risk-averse farmers, additional incentives in the form of MBIs are still needed to prevent conversion of agroforest over the years, and only the combination of MBIs can achieve this target. Implementing fixed MBIs also contributes to stabilizing farmers’ incomes and reducing income risks. Consequently, the combined MBIs increase incomes and reduce income inequality between hardly and extremely risk-averse farmers.

Economics of Land Degradation and Improvement in Uzbekistan

Land degradation is a major challenge for agricultural and rural development in Uzbekistan. Our research findings indicate that the costs of land degradation in Uzbekistan are substantial; reaching about 0.85 billion USD annually resulting from the loss of valuable land ecosystem services due to land use and land cover changes alone between 2001 and 2009. On the other hand, economic simulations also show that the returns from actions to address land degradation can be four times higher their costs over a 30-year planning horizon, i.e. every dollar invested into land rehabilitation can yield 4 dollars of returns over this period. The priority geographic locations for actions against land degradation are suggested to be Karakalpakstan, Buhoro and Syrdaryo provinces of Uzbekistan, where the returns from actions are the biggest. The econometric analysis of a nationally representative survey of agricultural producers shows that national policies could enhance the uptake of sustainable land management practices by increasing crop diversification, securing land tenure and creating non-farm jobs in rural areas.

A Co-evolutionary Perspective on the Adoption of Sustainable Land Use Practices: The Case of the Amu Darya River Lowlands, Uzbekistan

Using the example of the Amu Darya River lowlands of Uzbekistan, I analyze land degradation problems, and rehabilitation options, and their implementation constraints within a framework of coevolving socio-ecological systems, which emerged in ecological economics. Cotton export income substantially contributes to Uzbekistan’s economy. To reach cotton targets, farmers initiated unsustainable land management practices, resulting in degradation of vast areas of land. This has had reciprocal effects on the wellbeing of the population: declining yields in crops and shrinking incomes. One option for improving land can be afforestation. However, such land use is not practiced due to path dependencies, interdependencies, and goal dependencies. Farmers’ uncertainty regarding costs and benefits and their perceptions of land use, shaped by a history of agricultural policies and practices, make them unreceptive to planting trees on marginal croplands. This cotton cultivation lock-in is a result of high investments in cotton production policies, institutions, and infrastructure. Establishing tree plantations on marginal croplands may change the implementation and later formation of agricultural policies and alter relations between agricultural policy and production actors, which are all highly interdependent in the current cotton-centric configuration. Understanding these dependencies is necessary for understanding the constraints affecting sustainable natural resource management systems. Only then can policies be derived that may lead to the adoption of innovative sustainable land uses.

Water Footprints: Integrated Water Resource Management to the Rescue in the Aral Sea Basin

Intensive agricultural production in the countries of the Aral Sea Basin has resulted in undesirable ecological and social consequences, including the drying of the Aral Sea. Water has become scarce due to a score of internal and external factors including the growing demand for water resources by the upstream countries, expansion of the irrigated areas to ease food insecurity, and the poor condition of irrigation and drainage networks. To cope with environmental consequences and regional water challenges, it is vital to look for pathways of improved integrated water resource management, higher water use efficiencies, and reducing overall water use. A combination of value chain and water footprint analyses of the dominant crop, cotton, was applied to assess water use in different sectors of the Uzbekistan economy and to seek water saving and improved water management and efficiency options. The findings show that reduction in water use could be achieved by diversifying the economy and moving from water intensive agricultural production to less water consuming industrial sectors by introducing water saving irrigation technologies and by raising awareness of the population about the real value of water. The combined findings of the economic based value chain analysis and ecologically oriented water footprint analysis gave an added value for better informed decision-making to reach land, water, and ecosystem sustainability and to contribute to the Millennium Development Goals of eradicating poverty and hunger and achieving food and water security.