Poverty mitigation through optimized water development and use: Insights from the Volta Basin

Abstract

Ongoing challenges from population growth and climate stress on the water resources of the Volta River Basin raise the importance of finding economically sustainable water development and use patterns. Much research has been conducted on the impacts of water supply fluctuations, climate change, and population growth on effective economic access to water resources of the basin. However, no work to date has comprehensively investigated the sustainable economic performance of additional infrastructure development in the basin for handling ongoing challenges of climate water stress at the entire basin scale. The original contribution of this work is to investigate the capacity to mitigate poverty from new reservoir storage capacity if established in a flood-prone region in northern Ghana, using a basin-scale hydro-economic optimization framework, while accounting for five major water uses for six riparian countries. An integrated approach is formulated to link the hydrologic, agronomic, institutional, and economic dimensions of the basin into a unified framework for policy analysis. A dynamic optimization model is developed and applied to discover the level and distribution of economic impacts from the additional storage infrastructure development. Results indicate the potential to increase economic benefits to Ghana and Burkina Faso, with no economic loss to any other riparian, from the development and operation of additional storage infrastructure. Results show considerable potential to secure an Actual Pareto Improvement, by which Ghana and Burkina Faso are better off with the new storage infrastructure than without it, and no other riparian country in the basin is worse off. Additional storage infrastructure in the flood-prone area of the basin in northern Ghana carries the potential to store water during wet seasons and years and release water for use in dry seasons and years, reallocating water among seasons and years, elevating economic development to the Basin’s riparian countries. Despite our optimistic findings, considerable stakeholder negotiations and cooperation will be needed to secure the potential welfare gains uncovered.