Report No. 28766 - LE Republic Of Lebanon Policy Note on Irrigation Sector Sustainability November 2003 The World Bank Water, Environment, Social, and Rural Development Group Middle East and North Africa Region and Agriculture and Rural Development Department Contents Preface........................................................................................................................................... vii Acronyms and Abbreviations........................................................................................................ viii Executive Summary........................................................................................................................ ix 1. Introduction............................................................................................................................. 1 2. Water Resources....................................................................................................................... 2 WATER DEMAND............................................................................................................................6 For Irrigation Water................................................................................................................... 6 For Domestic and Industrial Use................................................................................................. 7 3. The Agriculture Sector........................................................................................................... 10 ROLE OF AGRICULTURE IN THE ECONOMY......................................................................................10 AGRICULTURE IN THE LAST FIVE-YEAR PLAN.................................................................................11 4. Main Features of Irrigated Agriculture .................................................................................. 13 WATER AND LAND USE.................................................................................................................13 EXISTING ANDPROPOSED IRRIGATION SCHEMES.............................................................................15 CROPPINGPATTERNS.....................................................................................................................17 5. Current State of Water Quality and Pollution Control........................................................... 19 RECOMMENDATIONS.....................................................................................................................22 6. Institutional Aspects............................................................................................................... 25 WATER LAW AND WATER RIGHTS.................................................................................................25 ORGANIZATION OF THE WATER SECTOR.........................................................................................25 Historical Perspective.............................................................................................................. 25 The Current Situation............................................................................................................... 30 Weaknesses of the Present System............................................................................................. 32 RECOMMENDATIONS.....................................................................................................................33 7. Operation and Maintenance, Tariffs, and Cost Recovery....................................................... 35 OPERATION AND MAINTENANCE....................................................................................................35 WATER TARIFFS AND COST RECOVERY..........................................................................................36 RECOMMENDATIONS.....................................................................................................................38 8. Financial and Economic Aspects............................................................................................. 41 COMPETITIVENESS AND SUSTAINABILITY OF IRRIGATED AGRICULTURE...........................................42 AGRICULTURAL MARKETING.........................................................................................................44 RECOMMENDATIONS.....................................................................................................................44 AGRICULTURAL SERVICES: RESEARCH, EXTENSION AND CREDIT.....................................................44 Agricultural Research............................................................................................................... 44 Extension................................................................................................................................. 45 AGRICULTURAL TRADE AND TRADE AGREEMENTS.........................................................................45 iii 9. The Public Investment Program in Irrigated Agriculture....................................................... 47 MOEW INVESTMENTPROGRAM ....................................................................................................47 LRA INVESTMENTPROGRAM.........................................................................................................48 RECOMMENDATIONS.....................................................................................................................52 10. Strategic Choices Facing Irrigated Agriculture .................................................................. 53 TECHNICAL ASPECTS.....................................................................................................................53 FINANCIAL AND ECONOMICASPECTS.............................................................................................54 INSTITUTIONAL ASPECTS...............................................................................................................55 ENVIRONMENTAL ASPECTS............................................................................................................56 AREAS OF POSSIBLE BANK SUPPORT ..............................................................................................57 Appendix 1 Overview of Irrigation Schemes in Lebanon............................................................... 59 Appendix 2 Water Resources and Use in Lebanon......................................................................... 64 Appendix 3 Pollution and Treatment of Water Sources in Lebanon.............................................. 67 Appendix 4 Historical Review of Water Laws in Lebanon............................................................. 69 Appendix 5 Operation & Maintenance of Irrigation Systems ........................................................ 71 References...................................................................................................................................... 75 Tables TABLE 2.1 CATCHMENT AREAS OF THE MAJOR RIVERS OF LEBANON......................................3 TABLE 2.2 EXISTING SCHEMED AND SMALL SCALE IRRIGATION AREAS (HA)............................6 TABLE 2.3 PROPOSED IRRIGATION EFFICIENCIES ...................................................................7 TABLE 2.4 PROJECTED WATER DEMAND FOR IRRIGATION BY MOHAFAZA ...............................8 TABLE 2.5 TOTAL ANNUAL WATER DEMAND AND AVAILABLE SUPPLY....................................9 TABLE 3.1 GROSS VALUE OF AGRICULTURALPRODUCTION.................................................11 TABLE 4.1 ESTIMATES OF WATER RESOURCES UTILIZATION.................................................13 TABLE 4.2 LAND RESOURCES AND LAND USE (1,000 HA) IN LEBANON, 1998.........................13 TABLE 4.3 FARM LAND IN FOUR SELECTED DISTRICTS AND ENTIRE LEBANON, 1998 ..............14 TABLE 4.4 PRESENT LANDUSE...........................................................................................15 TABLE 4.5 IRRIGATED AREAS.............................................................................................15 TABLE 4.6 PROPOSED AND ONGOING IRRIGATION SCHEMES.................................................16 TABLE 4.7 CROPPING PATTERN IN THE MOHAFAZATS..........................................................17 TABLE 5.1 CHLORIDE AND SODIUM CONCENTRATIONS IN 31 WELLS ACROSS THE COUNTRY...21 TABLE 6.1 REGIONAL WATER AUTHORITIES........................................................................27 TABLE 6.2 LOCAL WATER COMMITTEES FORMED BETWEEN 1984 AND 1990..........................29 TABLE 6.3 RECENTLY CREATED WATER AUTHORITIES.........................................................31 TABLE 6.4 WATER AUTHORITIES GENERAL CHARACTERISTICS............................................34 TABLE 8.1 IMPORTS AND EXPORTS OF AGRICULTURAL PRODUCTS (LL BILLION), 1999-2001 .45 TABLE 10.1 MOEW'S INVESTMENT PROGRAM, 2003-2030..................................................48 TABLE 10.2 LRA'S INVESTMENT PROGRAM, 2003-2020 ......................................................49 TABLE 10.3 SUMMARY OF LEBANON'S CURRENT IRRIGATION INVESTMENT PROGRAM , 2002-2030....................................................................................51 TABLE A1.1 EXISTING SCHEMED IRRIGATION......................................................................59 TABLE A1.2 PROPOSED AND/OR ONGOING IRRIGATION SCHEMES .........................................62 TABLE A2.1 CROP WATER REQUIREMENTS..........................................................................64 TABLE A2.2 EFFECTIVE RAINFALL.....................................................................................64 iv TABLE A2.3 FIELD WATER REQUIREMENTS.........................................................................65 TABLE A2.4 DIVERSION WATER REQUIREMENTS FOR SURFACE IRRIGATION..........................65 TABLE A2.5 DIVERSION WATER REQUIREMENTS FOR SPRINKLING IRRIGATION......................66 TABLE A2.6 DIVERSION WATER REQUIREMENTS FORDRIP IRRIGATION (MCM/YEAR)..........66 TABLE A3.1 EXPECTED AND PLANNED WASTEWATERTREATMENTPLANTS...........................67 TABLE A3.2 LAWS RELATING TO THE POLLUTION AND PROTECTION OF WATER RESOURCES...68 TABLE A5.1 EXISTINGOPERATION& MAINTENANCE ADMINISTRATION AND TARIFFS (2003)71 TABLE A5.2 OPERATION& MAINTENANCE ARRANGEMENTS AND TARIFFS (1995)................72 Figures FIGURE 2.1 FUTURE AND CURRENT WATER BALANCE FOR LEBANON (BCM/YEAR)................5 FIGURE 6.1 ORGANIZATION OF MINISTRY OF ENERGY ANDWATER......................................28 v Preface This Policy Note has three main objectives. The first is to formulate strategic choices related to the sustainability of irrigated agriculture in Lebanon. The second is to recommend institutional strengthening of water resource management in the irrigation sector in general, especially for operations and maintenance (O&M). The third is to define the Bank's possible future involvement in the irrigated agriculture sector. The main recommendations of this Policy Note (PN) will be used as an input to the Country Assistance Strategy (CAS) currently under preparation by the Middle East and North Africa (MENA) Region. The Bank originally planned to collaborate with the Government of Lebanon (GOL) officials to prepare a strategy for overall water resource management in Lebanon. However, the government of Japan offered to assist the government carry out an urgently needed Water Resources Management Master Plan (WRMMP) through the Japan International Cooperation Agency (JICA). Consequently, the GOL and the Bank agreed to focus the study on the irrigation sector. It should be noted that the scope of the report does not include the rainfed agriculture sector. The Bank team has used the concept of sustainability in two contexts. First is the physical sustainability of the irrigation system network, which is achieved through adequate operation and maintenance. The second is sustainability of the irrigated agricultural sector. The sustainability of the entire agriculture sector is more fully discussed and developed in the Bank's report entitled "Lebanon: Perspectives on Agricultural Sector Issues (Draft)". While in Lebanon, it became evident that the Note would have to go beyond its original objectives. First the team had to work out a new water balance for Lebanon due to controversial figures. Second, the Ministry of Energy and Water (MOEW) and the Litani River Authority (LRA) had very ambitious investment programs, which needed to be made more realistic. Adel Bichara (MNSRE) led the team that prepared this Note. The team--which included Randa Nemer. Joseph Fuleihan, Nejdet Al-Salihi, and Ziad Hajjar--wishes to thank Safwat Abdel-Dayem, Drainage Adviser in the Agriculture and Rural Development department of the World Bank, and Masood Ahmad, Lead Water Resources Specialist in the Europe and Central Asia Region of the World Bank for their insights and suggestions as peer reviewers for this project. They also extend special thanks to Syviengxay Creger for her contribution throughout the preparation of this Note. The Middle East and North Africa Region of the World Bank Vice President Mr. Christian Poortman Country Director Mr. Joseph Saba Sector Director Mrs. Letitia Obeng Sector Manager for Water and Environment Mr. Vijay Jagannathan vii Acronyms and Abbreviations ARIL Agriculture Research Institute of Lebanon AUB American University of Beirut BCM Billion Cubic Meter BOD Biochemical Oxygen Demand CAS Country Assistance Strategy COD Chemical Oxygen Demand DGO Directorate General of Operations DGHER Directorate General of Hydraulics and Electrical Resources ESCWA Economics and Social Commission for West Asia (United Nations) EA Environmental Assessment EC Electric Conductivity FAO Food Agriculture Organization GCC Gulf Cooperation Council GOL Government of Lebanon GP Green Plan IRMP Irrigation Rehabilitation and Modernization Project JICA Japan International Cooperation Agency LRA Litani River Authority MCM Million Cubic Meter METAP Mediterranean Technical Assistance Program MOE Ministry of Environment MOEW Ministry of Energy and Water MOPH Ministry of Public Health NERP National Emergency Recovery Program NGO Non-Governmental Organizations RWA Regional Water Authority UNICEF United Nations Children's Fund USAID United States Agency for International Development USEPA United States Environmental Protection Agency WA Water Authority WHO World Health Organization WRMP Water Resources Master Plan WUA Water Users' Association viii Executive Summary As demand for domestic, industrial, and agriculture water increases, Lebanon could face chronic water shortages in the next two decades, particularly in the summer months. In fact, signs of such shortages are already apparent. The data on water demand and water balance are conflicting, but they generally indicate that the overall annual water balance will practically go into deficit just after 2020, while the dry season balance will be in deficit in 2004. Faced with this challenge, the Government of Lebanon (GOL) is keen to take measures to enhance the sustainability of water resources in the country, including irrigation, which accounts for about two thirds of the annual water use. Presently the total water demand is estimated at about 1,260 MCM/year and this figure is expected to rise to about 2,820 MCM/year by 2030. Tentative findings show that, by 2004, the water shortage during the dry months that could exceed 700 MCM by 2030. At the same time, Lebanon loses over 700 MCM of water to the sea annually. Most of the demand is concentrated on agriculture in the Bekaa Valley and and on potable water and industry in the large cities like Beirut and Tripoli. To overcome the large dry season deficit, the country will have to rely on excessive pumping at considerable economic and environmental cost unless water resources management is improved. In the medium term, GOL plans to increase water storage capacity from its present level of 220 MCM to about 500 MCM or more in addition to taking drastic measures to improve the water supply and distribution efficiencies. In addition to existing structural problems, the quality of existing water resources is being undercut by pollution, such as, direct discharges of municipal and industrial wastewater, uncontrolled solid waste disposal, leaching of pesticides and fertilizers from agricultural lands, and seawater intrusion along the coast as a result of over exploiting groundwater. For example, pollution in the Litani River, the largest in Lebanon, has limited its use. THE ROLE OF THE AGRICULTURE IN THE ECONOMY Agriculture's contribution to gross domestic product (GDP) grew during the civil war, peaking at 23 percent in the 1990s. Since the mid-1990s, its role has gradually eroded to pre-war level, reaching 6.3 percent in 1997.1 There is no evidence that its share has grown since then. Annual agriculture growth rates experienced wide fluctuations within a declining trend--for example, 8.6 percent in 1995 and 1.1 percent in 2000. The main reasons for the low rate of growth of the agriculture sector include: a high cost structure, an overvalued exchange rate and high interest rates, an infrastructure that was either damaged or neglected during the civil war, and structural issues. For more details on the subject, reference is made to the Bank's agriculture policy note for Lebanon titled "Lebanon: Perspectives on Agricultural Sector Issues" (World Bank 2003). The agricultural labor force fell from over 30 percent of total employment in 1964 to its current level of nine percent, and there are wide regional differences in this figure.2 Agriculture and food products account for about 20 percent of total trade, with the major exports being fruits and vegetables. The main 1According to revised National Accounts by the Ministry of Economy 2For more details on the subject, please refer to Lebanon - Perspectives on Agriculture Sectors Issues December 2003 - Report no 26265-LE. Water, Environment, Rural and Social Development Department, Middle East and North Africa Region. ix agricultural export markets are Saudi Arabia and Kuwait, followed by Syria, Jordan, the United Arab Emirates (UAE), Egypt, and Bahrain. The United States, Syria, and the European Union are the largest exporters of grains (wheat) and flour, dairy products, meat, and fish to Lebanon. REFORMING THE OR GANIZATION OF THE WATER S ECTOR There are a number of institutional and administrative issues in the water sector. First is the delay in implementing legally mandated systems to support the new Water Authorities (WA). Law 221, passed in April 2000, addresses the organization of the water sector and the consolidation of water resource management. The law covers several issues involving the Ministry of Energy and Water (MOEW), the four new Water Authorities (WAs), the 22 Regional Water Authorities/Boards (RWAs), and the 209 Local Water Committees (LWC). Although the law was published in year 2000, the presidents and members of the WA boards were only appointed in late 2002, delaying its effective application. The WAs are expected to take over the management of the irrigation, potable water, and sewerage schemes, but technical, administrative, and financial constraints are preventing this. Therefore, the Local Water Committees still manage the irrigation and sewerage schemes, and there are no immediate plans to shift to the new system. Second is the fragmentation of, and lack of cooperation between, the numerous agencies in charge of water resource management--including, MOEW, Litani River Authority (LRA), WAs, RWAs and LWCs. The third issue is the lack of stakeholder participation in project design, implementation, and operation and maintenance (O&M). The sector also suffers from the absence of Water User Associations (WUAs), although some of the LWCs play a slightly similar role. Another issue is that the laws and regulations governing the water sector, which were promulgated under Ottoman and French codes, have not been updated to deal with emerging issues such as acquired water rights and the legal framework for the establishment and operation of WUAs. Finally, the government lacks an effective mechanism to enforce existing regulations and permits for drilling wells and maintaining the appropriate distances between wells and springs. Several organizations are responsible for O&M in Lebanon (MOEW, LRA, WAs, RWAs, Local Committees, and municipalities). The newly created WAs are expected to oversee the planning, the design, the implementation, as well as the O&M of water and wastewater infrastructure. The MOEW is expected to supervise all these WAs in the areas of planning and formulation of strategies for water monitoring and distribution. Moreover, MOEW is responsible for setting specifications of water development and service levels, establishing regulations for supervision, evaluating the quality of water services, and setting water tariffs and pricing mechanisms. LWCs and farmers' groups are most involved with O&M for small and medium irrigation schemes. Of the total number of schemes, about half are operated and maintained by farmers groups. This is a clear indication that introducing formal WUAs, as an efficient and sustainable way for organizing O&M, is possible and could be successful. While a wide range of laws and regulations regulate water use and disposal in Lebanon, there are no references to a policy on cost recovery. Lebanon generally uses two tariff systems: area charges and volumetric charges, but each RWA has its own procedures for setting and collecting tariffs. Currently, the tariff rates vary widely, from US$0 to US$400/ha RWAs or LWCs are responsible for enforcing tariffs. The outlook for physical sustainability of Lebanon's irrigation network is promising. Schemes operated by LRA do achieve full cost recovery. Many small schemes, which are operated by LWCs already finance part of O&M costs, and now have to finance the subsidy that used to be provided by MOEW. In other schemes, O&M charges and collections need to cover O&M costs, in line with recommendations given in x this Note. Any future water tariff policy should take into consideration economic efficiency, ability to pay, and access to services and distribution. RATIONALIZING PUBLIC INVESTMENT FOR IRRIGATION MOEW and LRA are the two agencies in charge of irrigation investment programs. Their planned investment programs represent about US$1.3 billion in spending, which averages to about US$48 million per year. If the irrigation investment programs are implemented, the water storage capacity of dams/reservoirs in Lebanon would increase from 220 MCM to over 500 MCM, and the total irrigated area would increase by about 50,000 ha over 30 years. The irrigation investment program alone would rehabilitate or modernize 30,500 ha of irrigated areas. This program is very ambitious when one considers that Lebanon increased its irrigated area by about 20,000 ha and rehabilitated about 25,000 ha during the last 15-20 years. Lebanon currently has only one large and around 15 very small wastewater treatment plants. GOL has a long-term plan to build 25 new plants for the major cities. The development of cost-effective, small-scale wastewater treatment plants for rural communities is a priority, as treated wastewater can be used in agriculture. However, this requires a regulatory framework, public awareness campaigns, and training concerned staff and farmers on using treated wastewater for irrigation. Irrigation efficiency can be improved through incentives for water-saving technologies--such as, duty free imports for drip and sprinkler equipment; technology transfer through effective applied research and extension services to improve on-farm irrigation efficiency; and raising cost recovery in irrigation schemes in addition to rehabilitating and modernization of the irrigation schemes main networks. The Bank recommends several actions to better manage the demand for rrigation water and cost i recovery system. First, the agencies responsible for setting and collecting tariffs on irrigation water should raise those tariffs to cover O&M costs, and these charges should be based on the volume of water used rather than area, which does not provide an incentive for more efficient water use. Second, the agencies should also periodically review and adjust water tariffs to reflect actual costs. Finally, GOL should enforce the licensing of wells by imposing heavy penalties for violations in order to reduce construction of new illegal wells. By one estimate, there are 10,000 legal and about 40,000 illegal wells. These steps should contribute to the sustainability of irrigation schemes. This Policy Note (PN) recommends scaling down the investment program to no more than an average of US$35-40 million per year. This would mitigate any increase in the high public debt, and it takes into consideration the capacity of the implementing agencies. If GOL adopts this recommendation, irrigated area would still increase by around 36,000 ha over 30 years. Farm income would also increase but there would be room for more orderly marketing of incremental production in the new irrigated areas. INCREASING AGRICULTURAL COMPETITIVENESS The planned increase in irrigation potential--by 30-50 percent in the next 30 years--would result in substantially increased agricultural production. The local market would absorb a large proportion of this production, given the present population growth rate. However, the increasing the irrigation potential should go hand-in-hand with producing high-value crops for international markets. The proper processing and quality control mechanisms will be needed to take advantage of this change. Lebanon has a comparative advantage in high value horticultural crops, but is not competitive in field crops. This is enhanced by the diversity of its climatic zones, proximity to the Gulf and European markets, and advantageous terms negotiated in the EU Association Agreement. Nevertheless, Lebanon xi faces strong competition in vegetables and some fruits from neighboring countries that either have lower costs, subsidize inputs, or both. Therefore improving competitiveness is key to the future of agriculture in Lebanon. The Bank recommends that any investment in irrigation should be accompanied by investments to improve marketing infrastructure and services--such as, wholesale markets, and communications networks. GOL should also encourage private investments in storage, processing, packaging, and risk management, aided in the short term by an incentive framework. Finally, GOL should create a regulatory environment that enhances the role of farmer organizations and cooperatives to improve quality, efficiency, competitive price formation, and reduce market risks. Lebanese farmers can further enhance their competitiveness by producing high-value specialty crops-- such as, organic food, seedless grapes, cherry tomatoes, wines, medicinal plants, herbs, etc.). They should replace aging varieties of apples and other fruits and cater to changing consumer preferences. Farmers can also reduce costs by increasing the cropping intensity of irrigated agriculture; using less agro-chemicals; adopting more efficient irrigation technology (drip and sprinkler use). GOL should mitigate the impact of structural obstacles such as small and fragmented holdings and the land tenure system over the long term. Lebanon has good potential for expanding the export of high quality processed food products to the EU, the Gulf, and the US. GOL has made a good start by hiring three international firms for quality control of agricultural produce for export. However, the Government needs to make more of an effort to improve product quality so that it meets EU and international standards. It is particularly important to have an internationally accredited laboratory certify the pesticide levels in exports. It will also be necessary for exporters to wage an aggressive marketing campaign and hire a European firm to develop markets for them. They also need to receive real time market data and information on tariffs, country of origin, and other export requirements in destination markets by IDAL or Chambers of Commerce. The falling exchange rate should also improve the competitiveness of agricultural and processed food products, but its magnitude is not known, due to the lack of empirical estimates of the elasticity of agricultural exports to the exchange rate. Institutional aspects Overall, irrigated agriculture should be sustainable in the long term because agriculture in Lebanon supplements family income instead of being the only source. The challenge is to make agriculture more competitive and efficient. The EU Partnership Agreement provides a unique opportunity and potential market for high value horticultural produce, provided Lebanon complies with health and quality standards. Moreover, Lebanon can expand its export of processed food and specialty products for which it is competitive. Although WAs in principle have administrative and financial autonomy, they face serious staffing and financial constraints. In view of their limited administrative and financial capacity, WAs have expressed the need for farmers to assume responsibility for the O&M functions of irrigation schemes through the formation of WUAs. This Note endorses that move. To facilitate this, GOL should accelerate issuing the executive regulations and by-laws that will empower WAs with the autonomy envisaged by Water Law and that would enable them to hire the technical staff they need. It should also pass legislation to update the laws regulating the water sector, especially to provide a legal framework governing WUAs and to address the issue of acquired water rights. Moreover, the capacities of the MOEW, of the RWAs, and of the LRA need to be strengthened in the areas of water quality testing and monitoring, data analysis, quality assurance and control, and database and reporting. This study commends GOL for its policy of encouraging a public-private partnership in water resource management and for seriously considering the eventual privatization of the services of WAs and establishment of WUAs. Best practice has shown that the most successful projects are those that involve xii stakeholder management of O&M functions through WUAs. The newly established WAs are in favor of this approach and support the establishment of the WUAs because this would reduce their administrative and financial burdens. However, the WAs should remain in charge of the O&M of larger main canals, intake structures and pumping stations which are often well above the farmers' capacities. MOEW should continue to assist the WAs and regional and local committees in the O&M of irrigation schemes, especially those that are in bad state of repair, until the WAs become fully operational. Large civil works should remain MOEW responsibility. Bank proposes that GOL consider an option that has been implemented in Morocco and Egypt. The government would give a role to the private sector as a potential partner in public investment and/or manager of an irrigation scheme. This can be designated as a pilot, and if successful, it can be replicated. In this option, a private firm would be in charge of O&M functions of the scheme, decide on the level of service needed by farmers in collaboration with stakeholders, and set irrigation water tariffs to cover those O&M services. Environmental aspects Environmental mitigation measures are essential for improving water quality. To implement this, the Bank recommends that GOL establish a national water quality program to monitor surface and groundwater resources, particularly in the Litani basin. It should also start pilot projects to test different technologies and practices for the reuse of treated effluent from municipal plants. GOL should establish and implement the "polluter pays" concept that is commensurate with the degree of pollution. Finally, the Government needs to strengthen the capacity of the agencies dealing with water quality testing, data analysis, quality assurance, and control, in addition to establishing and maintaining databases on water quality. AREAS OF POSSIBLE BANK SUPPORT The World Bank can provide support to a number of the planned irrigation investments that will be implemented by MOEW and LRA. These include: · South Bekaa Phase II Project. This project would improve irrigation on 6,700 ha that are currently irrigated through uncontrolled private pumping. The 2002 updated feasibility study showed that the project is viable, since a significant proportion of the major investments in basic infrastructure have already been made in Phase I, which was financed by the Bank and GOL. The total cost of the project, excluding contingencies, is US$45 million. LRA would implement the scheme in over a period of four to five years. · South Qaraoun Irrigation Scheme. The feasibility study currently underway shows that at an estimated cost of about US$5 million, the scheme would irrigate an area of 800 ha from the Qaraoun reservoir. LRA would implement the scheme in two years. · El Bared Dam and Reservoir Scheme. This scheme includes constructing a storage dam on the El Bared river, with a storage capacity of 40 MCM, and rehabilitating the irrigation conveyance and distribution networks. The project provides drinking water (20 percent) in addition to irrigation water (80 percent). Although a feasibility study has not been carried out, the project is expected to be viable since it capitalizes on existing infrastructure. The project would provide irrigation water to around 4,000 ha in some of the poorest Cazas in Lebanon (Akkar, Minieh, and Dannieh) and drinking water for Tripoli and its surrounding areas. The estimated cost of the project is US$45 million, to be implemented by MOEW over a period of four years. The Bank could finance rehabilitation and modernization of the irrigation network for around 4,000 ha. xiii In addition, the Bank can play an extremely useful role in supporting the establishment of WUAs by providing technical support to establish the legal framework and formal creation of WUAs, and by training the staff of concerned agencies. This is now more urgent since GOL stopped subsidizing O&M of irrigation schemes operated by local water committees. WUAs would eventually replace other organizations in charge of O&M functions of irrigation schemes. Another area of possible Bank support involves human resource capacity building of MOEW and LRA in the technical and management fields, to enable them to carry out the proposed investment programs. Many irrigation schemes proposed by MOEW or LRA are in a preliminary phase. Before any irrigation scheme is undertaken, it is imperative to carry out a full-fledged feasibility study to determine the economic feasibility of the proposed project and taking into consideration the social aspects of the project. The World Bank can assist GOL in this regard by reviewing terms of reference for consultants, selecting consultants, and reviewing feasibility studies. In addition to the areas above, any new investment by the Bank in the irrigation sector should be accompanied by parallel investments in the agricultural sector in order to ensure that high-value horticultural crops are being produced and that their marketing channels are ensured. xiv 1. Introduction Lebanon has an area of 10,452 km2, and a population of about 4.4 million inhabitants, excluding migrant workers. Therefore high population density high: in excess of 420/km2. Much of the country is mountainous and cultivable land is limited to around 250,000 ha. Of this area, 90,000 ha are equipped for irrigation. About one-half of irrigation water is supplied from rivers and spring water and the other half from groundwater. With an average overall per capita supply around 2,000 m3/year and annual average precipitation at 8.6 BCM/year, Lebanon is relatively better endowed with water resources than its neighbors. The country has 17 main rivers, of which three are international; about 2,000 springs; and nearly 50,650 wells. However, water is distributed unevenly among regions and between seasons, and in some locations it is difficult to harness, due to steep slopes. As a result, Lebanon loses an estimated 1.4 BCM to the sea annually, which is a cause of great concern for the country. At present, Lebanon has only one large dam, Qaraoun Dam in the Bekaa valley, with a storage capacity of 220 MCM and is now constructing another dam for potable water supply, the Chabrouh Dam in Mount Lebanon with a storage capacity of 8 MCM. In addition, Lebanon has one large hill lake with a storage capacity of two MCM. There are several government agencies involved to varying degrees in water resource management in Lebanon, with overlapping functions. The main agencies are the MOEW, the Litani River Authority (LRA), and the recently established four regional Water Authorities (WAs), which officially replaced the 22 regional water authorities and about 210 local water committees. The MOEW is responsible for strategic planning of water resource management, including the preparation of the water master plan, conservation of surface and groundwater resources, as well as the design and implementation of large projects and dams; in addition, it has oversight of the WAs. The LRA was established in 1954 to implement the multi-purpose Litani River Scheme covering irrigation, potable water supply, and drainage, in addition to power generation. According to its mandate, LRA has responsibility for irrigation schemes in South Bekaa and South Lebanon. The WAs have the responsibility to plan, design, and implement small schemes in the areas of domestic water supply, irrigation, and wastewater networks that do not come under the jurisdiction of the MOEW and the LRA. The WAs also propose water tariffs through MOEW and the Ministry of Finance (MOF) for cabinet approval. Although the WAs in principle have administrative and financial autonomy, and have recently become operational, yet administrative, staffing, institutional capacity, and financial constraints abound. 1 2. Water Resources Water Supply. Although Lebanon is relatively well endowed with diversified water resources that are adequate for its present and short term future needs in annual and multi annual terms, it does nevertheless have water shortages during the dry season which extends over the four months of July and October and which will become more acute in the coming years. Data concerning water supply and water demand often do not converge, so this Note tries to reconcile the conflicting figures as much as possible. In addition, data from the JICA report were not fully used as the report is not yet finalized. Typical annual average rainfall ranges between 880-1,000 mm in the coastal areas, 1,000-1,400 mm in the mountains, 200-600 mm in the Bekaa and 600-1,000 mm in the South. Of the total annual rainfall, 70 percent falls on the western slope of the Mount Lebanon. The total annual water resources available to Lebanon according to a large number of sources are estimated at about 8.6 billion cubic meters (BCM), of which about 4.0 BCM/year are lost to surface evaporation.3 Of the remaining water, about 700 million cubic meters (MCM) per year flows to adjoining countries, 150 MCM infiltrates to groundwater beyond the southern boundaries and 700 MCM is lost to the sea by deep percolation (table 2.1). This leaves about 3.0 BCM remaining in Lebanon, of which 2.1 BCM is readily available for utilization. Estimating the amount of usable water is made difficult by the lack of reliable information on the interaction between surface and groundwater in the karstic system, which covers 60 percent of Lebanon. Of the available surface flows about 800 MCM is stored underground because of the karstic nature of the geology. Water resources are generally difficult to manage due to the cost and the technical difficulty of storage in spite of the considerable length of rivers estimated at about 800km resulting in the shortages experienced during the dry months of the year. The main rivers are: · The main river of Lebanon is the Litani, which is 170 km long with a basin originating in the upper Bekaa in the east and flowing south and west before finally flowing into the sea in the southwestern corner of the country. · El Assi river basin in the north flowing into Syria in the north-eastern corner of the country; · All the remaining major coastal river basins (except for the Hasbani) originate from the western slopes of Mount Lebanon and flow westward into the Mediterranean Sea. Of these, the northern most river, the El Kabir, forms the northern border of the country with Syria. Springs. Lebanon's groundwater table is generally high because of the high infiltration rate into the generally calcareous foundations. At the slopes of the mountain ranges this results in springs flowing out of the ground in many parts of the country including from openings of karstic caves. The water also runs down through subterranean water channels. The number of the springs in Lebanon is estimated at around 3Several sources cite a number of 4.5 BCM/year, while the recently completed first phase of the JICA report cites a figure of 2.7 BCM/year. For the purpose of this policy note, the Bank team uses an average figure of 4.0 BCM/year. 2 2,000. These vital sources of good quality water have been used by the inhabitants since time immemorial and are distributed almost evenly throughout the country. Table 2.1 Catchment areas of the major rivers of Lebanon Catchment Area (km2) and Runoffs (MCM/year) Name of JICA(2002) No Region River UNDP (1970) (*1) Runoff Notes 1 The North El Kebir 437 340 131 Shared with Syria 2 El Ostouene 160 173 67 3 Arka 153 191 70 4 El Bared 277 268 72 5 Abou Ali 484 494 205 6 El Jouz 198 190 40 7 Mount Lebanon Ibrahim 330 353 319 8 El Kelb 260 260 117 9 Beirut 231 229 65 10 Damour 288 292 157 11 The South Awali 302 304 371 12 Saitaniq 111 111 11 13 El Zahrani 88 106 13 14 Abou Assouad 132 148 3 15 Litani 2,168 2,181 689 16 The Bekaa El Assi 1,870 1,884 656 Flowing into Syria 17 El Hasbani(*2) 526 531 85 Flowing into Israel Total 8,015 8,055 3,069 Note: (*1) By GIS System under JICA Study; (*2) Excluding Marjaayoun Basin. Spring Yields. Relatively high precipitation and very high infiltration rates means that all springs have high seasonal flows. The total average yield of all springs is estimated to be about 1.4 BCM/year. Some springs discharge more than 140 MCM/year, such as Afka and Jeita, and the Ras El Assi spring being the largest with yields of more than 363 MCM/year.4 These levels of flow exceed the yearly runoff of some of the rivers--such as the River Beirut or the River Awali (UNDP, 1970). Lebanon has a Mediterranean climate with two distinct seasons: the dry summer and the rainy winter. As a result, the flows from springs also have high seasonal fluctuation with some of the larger springs and almost all the smaller springs drying up before the start of the winter season. The highest runoff flows occur in May, and while spring flow has a close correlation with rainfall there is a considerable time lag between the two. Groundwater wells and uses. Since there are many springs everywhere in the country, providing convenient sources of water for domestic, potable, and agricultural uses, no other form of groundwater has been used in the past, such as deep wells. Recently, however, people have started to dig wells or drill boreholes to secure a water supply because of the increasing demand for water and decreasing water sources. The agriculture and water supply sectors are the main developers of groundwater resources. The biggest consumer of groundwater is the agriculture sector, with the LRA being the biggest public sector organization. Altogether, 22 Water Authorities (now combined into four Regional Authorities) and several Water Supply Committees now own production wells to supplement the water supply from 4There are 30 major springs where average annual flow exceeds 10 MCM/year, four have between 10 and 20 MCM/year, 13 have between 20 and 50 MCM/year, five between 50 and 100 MCM/year and 4 springs with flows exceeding 100 MCM/year. 3 springs. More wells are being continuously drilled to meet the increasing demand for water, which makes it difficult to estimate their number. Besides the production wells constructed and operated by official agencies or public sector organizations, there are numerous private sector wells. These are generally small scale, mostly less than 100m in depth with a yield of about 50-80 m3/day. Well construction by the private sector has increased considerably since 1975 due to the breakdown of public services for the delivery of water during the period of civil strife in Lebanon. It is estimated that there are nearly 10,000 private wells in Lebanon which are formally approved by the MOEW, but it is thought that there are also more than 40,000 illegalwells. Wells are distributed all over the country with the major production wells, which are operated by public sector being concentrated near the major cities. The estimated total yield of all these wells is about 400 MCM/year. Re-use of treated sewage effluent. There is potential of re-using treated sewage effluent for irrigation purposes. However due to health issues and economical feasibility as well as to the fact that the GOL decided to discharge treated water effluent from major cities to the sea, the total available water for re-use is relatively small (max. 0.05 million m3/year) and would not be considered in the water balance exercise. Water Balance. Based on the best available data, an approximate water balance for the whole of Lebanon is presented in figure 1. In order to have better figures, a complete hydrological network and permanent measurement are required. Flood prevention and mitigation. The flood prevention and mitigation efforts suffer from the general inconsistencies of the sector. There is no one institution that coordinates matters, so the reaction is very slow in times of emergency. This generally results in a considerable loss to farming land and property. Unfortunately flood issues are not covered by any technical reference in Lebanon. Therefore any serious discussion of the subject could not easily be undertaken. The winter of 2003 brought a considerable amount of heavy precipitation after several years of near drought conditions, which resulted in heavy flooding in the Bekaa from the Litani River and other areas. This was the result of 400 mm of rain falling over an 11 day period over the slopes of the two mountain chains and on the Bekaa plains. While the Litani river encountered large flooding this year, most of the other rivers flowing through plain areas will encounter flooding during the winter months and in particular the southern banks of the Nahr El Kabir forming the border between Lebanon and Syria. MOEW is the authority responsible for monitoring and proposing amelioration of damages caused by river floods. The LRA will also carry out such functions in its areas of responsibility and is currently cooperating with the European Union to obtain technical and financial support for carrying out river training and for dredging the course of the Litani to reduce the risks of similar flooding in the future. There is also a General Council for Emergency Relief that maintains a database of consultants to review relief matters, including flood relief. The MOEW often asks the General Council to take action regarding any right of way violations of the natural watercourses in the country, which may have aggravated the ability of natural watercourses to convey high intensity flood flows. Inadequate meteorological early warning forecasts and inadequate monitoring of stream flow at the upstream watershed areas have contributed to the lack of preparedness. The logistics of flood prevention and mitigation require that certain stocks of equipment and materials be available in convenient storage to be called out to raise banks and repair breached embankments to contain flood damage in a short period thus limiting damage to life and property. Agriculture drainage, as practiced in irrigated agriculture in the river basins of the Nile, is not used in Lebanon mainly due the high soil infiltration rates and lack of any present water logging conditions. Some drainage may be required in the Bekaa Valley, but this is more as a result of flooding which the LRA deals with on an ad hoc basis. Future projects in the Bekaa valley should investigate the drainage requirements in more details. 4 Figure 2.1 Future and Current Water Balance for Lebanon (BCM/Year) RAINFALL SPRINGS 8.6 0.9 (1.4) Evaporation Groundwater GW to Neighboring SW to Neighboring Remaining in Rivers Others 4 to Sea Countries Countries Lebanon 0.7 0.2 0.7 3 0.8 (1.1) 0.1 (0.3) To Groundwater To Rivers 1 2 Springs 0.9 (1.4) Total to GW Total Rivers 1.6 (1.8) 2.8 (3.1) Pumped GW 0.7(0.4) To Groundwater To Sea Surface Water 0.6 (0.8)2 0.1 (0.7) 2.1 [1.6]1 Notes: 1. (1.6) = Value of presently available surface water. (2.1) = Maximum possible values. 2.(0.8) = Present value of groundwater recharge of 0.8 BCM / Year, goes to springs and the rest to wells.GW = Ground Water. SW = Surface Water. 5 WATER D EMAND For irrigation water The agriculture sector is the main water consumer in the country, using about 64 percent of water diverted from surface and groundwater sources. Given the impending water scarcity, most planners now recognize the need to adopt more efficient irrigation methods, which implies modernized irrigation techniques and practices to ensure higher irrigation efficiencies. To estimate the overall demand for water, it is essential to assess the present use of water for irrigation; however, data and information to identify the actual consumption of irrigation water, such as the volume of water diverted and applied in the field, are scarce. The amount of water crops consume depends on climate, cropping calendar, and farming practice. Actual water allocations will depend on the method of irrigation--such as surface, sprinkler, and drip irrigation. Parameters for estimating irrigation water demand include: · Existing Irrigated Area. The total gross equipped area is estimated at 90,000 ha, of which the net irrigated area is about 81,030 ha as shown in table 2.2 and in appendix table A1.1. Table 2.2 Existing schemed and small scale irrigation areas (ha) 67 Schemed Small Scale Category Irrigation Irrigation Total Equipped Area 65,600 24,400 90,000 Net Irrigated Area 59,070 21,960 81,030 Ref. Preliminary JICA Report. · Proposed New Irrigation Areas. In total, 17 irrigation and 18 hill lakes projects are being studied or are proposed for future implementation up until 2030, with an irrigation area of about 80,000 ha.5 The estimated cost and the implementation time frame have been discussed with MOEW and the LRA. The total estimated cost of the programs of both the Ministry and the LRA is about US$1,350 million. If the expenditure is incurred by 2030 the average basic annual cost (not including contingencies) would be about US$48 million. The choice of a development scenario would depend on available external funding and counterpart funding from GOL, on institutional capacity, and on other considerations related to agriculture (for instance, research, extension, quality control, marketing, etc.). · Cropping Pattern. The relative distribution of cultivated land in Lebanon according to the regions can be simplified as the: · coastal plains with fruit trees and vegetables with water supplied from the nearby rivers; · mountainous areas with fruit trees with water supplied from small springs that emerge at a high elevation, and · Bekaa plain with vegetable crops and cereals supported by the industrial processing of sugar beets and using water from nearby rivers and groundwater aquifer and treated wastewater. 5 This includes expanding the current schemed areas by 50,000 ha and rehabilitating and/or modernizing 30,000 ha of existing irrigation schemes (see table A2.2). 6 For determining the water requirement for irrigation, the crops are categorized into three, namely cereals represented by winter wheat, vegetables, and fruit trees. · Crop Water Requirements. Appendix table A2.1 shows seasonal fluctuation of the crop water requirement derived from reference crop evapo-transpiration after consideration of the crop coefficients for the various crops. Banana consumes the largest amount of water, 1,240 mm/year, while potato needs 575 mm per crop, both on the irrigated field. As for seasonal fluctuation, maize consumes 235 mm in August while 95 mm is required in July by olives that are also irrigated in some places of Lebanon. · Effective Rainfall. This varies from the highest in January at 128.9 mm to lows of 19.9 in May and 31.1 in October. There is practically no effective rainfall in June with 1.7 mm and practically no effective rainfall in the months of June, July, August and September. · Field Water Requirements. These are detailed in appendix table A2.3, and are derived from crop water requirements after subtracting effective rainfall. · Irrigation Efficiencies. Those adopted in Lebanon in consultation with MOEW and LRA officials are as follows: Table 2.3 Proposed irrigation efficiencies Efficiencies Irrigation System Conveyance Distribution On-farm Overall Sprinkler 0.95 0.95 0.8 0.7 Drip 0.9 0.8 Surface 0.90 0.90 0.75 0.6 · Diversion Water Requirement. Diversion water requirement for irrigation, after application of irrigation efficiencies, are summarized in appendix tables A2.4-A2.6. The data indicates that the highest user of irrigation water is Bananas where irrigation requirements range between 14,165 m3/ha, 12,141 m3/ha and 10,623 m3/ha for surface, sprinkler and drip irrigation respectively. The lowest user of irrigation water is wheat where the requirements for surface irrigation are 5,585 m3/ha and 4,788 m3/ha for sprinkler irrigation. · Current and Projected Irrigation Water Demands. Based on the above, and on the projected cropping intensities of no more than 150-160 percent, the water requirements of irrigated agriculture, as determined in the JICA study, gave the gross requirement in 2002 of 782 MCM/year increasing gradually to 1,127 MCM/year in 2030. Table 2.4 shows the projected water demand for irrigation by Mohafaza. During discussions with the MOEW it became apparent that they had reservations about the values adopted by the JICA report and mission has after discussions arrived at different realistic figures whereby the on farm average gross water requirements, including losses from source can be taken now as 9,000 m3/ha. This figure would be lowered to 8,000 m3/ha by year 2030. When this is translated to water demands in 2003, using a figure of 90,000 ha for the total irrigated area for the year 2003, the total demand would be 810 MCM/year of irrigation water requirements, increasing to 1,120 MCM/year in 2030 for an irrigated area of 140,000 ha. These figures correspond well with those calculated in the JICA report (782 and 1,127 m3/ha). For domestic and industrial use Domestic demand is estimated on the per capita water consumption assigned to each area, with non­ residential demand consisting of commercial and administrative uses in addition to any anticipated 7 expanding demand for tourism. The sources for satisfying water demand are either the public supply network, which provides water for the domestic and industrial uses, while incurring losses due to the leakage of the piped distribution system, or the private supply system, primarily from wells, which covers the demands for some domestic and industrial users. Table 2.4 Projected water demand for irrigation by Mohafaza (MCM/year) No. Name 2002 2005 2010 2015 2020 2025 2030 1 Beirut 0 0 0 0 0 0 0 2 78.4 78.4 78.4 78.4 78.4 78.4 78.4 3 N. Lebanon 158.3 158.3 158.3 158.3 174.8 174.7 174.5 4 S. Lebanon 117.7 145.4 145.4 167.9 192.3 191.6 220.5 5 Bekaa 411.7 412.2 478.1 477.7 481.8 481.6 481.0 6 Nabatiyeh 15.8 101.5 100.65 117.8 117.6 116.7 172.6 Total 781.9 895.8 960.7 1000.1 1044.8 1042.9 1127.0 Criteria for estimating Current Water Demand. Considering the results and observations of various studies, the basic criteria for estimating current water demand are set up as follows: · Residential Consumption. The majority of systems currently operate on a suppressed demand supply basis and there are few, if any, operating flow meters. There are furthermore no available records from which typical per capita consumption rate of existing water usage can be estimated. Based on discussions with the MOEW, a flat rate was used for the per capita water requirement, which would reflect the actual and future demand for water. An average national value of 140 l/c/d has been used for the purpose of this note. To reflect the higher standard of living in Lebanon, compared to many developing countries, as it is indeed a well-developed middle-income country, this rate has been assumed to increase by about 2.5 percent annually to take into consideration the increasing demand in the next 30 years. · Industrial Consumption. The mission had extensive discussions with the MOEW regarding the demand for water in industry. MOEW maintained that the allocations for this category should be adequate to cover the needs of industry in its broadest sense which should include tourism, an industry which is currently seeing the beginnings of a revival after many years of subdued activity due to the many years of civil strife and occupation. They maintain that in the medium and long term tourism and other agricultural and niche industries make Lebanon an ideal center of expanding economic activities in the region which would be very difficult to maintain if there was a water stressed situation in the country. It was therefore agreed that the industrial water demand would be maintained at 35 percent of the per capita residential consumption. · Wastewater and Reuse. The current amount of wastewater is about 550,000 m3/day. Of this, the raw wastewater is about 190,000 m3/day to which is added a further 45,000 m3/day as infiltration inflow into the sewage system resulting in the total sewer wastewater of 235,000 m3/day. It is estimated that about 10 percent of this (25,000 m3/day), which is about one percent of the average daily water demand for irrigation, can be used for irrigation. It is to be noted that this is a relatively small quantity of water and would not affect by any mean the national water balance. Assumptions: · Present Potable Water (PW) requirements per capita per day: 140 liters increasing annually by 2.5 percent. · Losses in the potable water conveyance and distribution systems: 35 percent. 8 · Yearly growth rate in population: 2.5 percent. · Industrial Water (IW) needs: 35 percent of Potable water requirements including losses. · Present Irrigation Water (IRRW) requirements: 9,000 m3/ ha (including losses in the conveyance from source and distribution systems) decreasing to 8,000 m3/ha in 2030. · Actual irrigation area in 2003: 90,000 ha. · Planned irrigation area in 2030: 140,000 ha. · Dry Season: Four Months: July to October. · Water needs during the dry season: 0.5 x PW+0.4 x IW+0.85 x IRRW. · Total Available Annual Water: · Readily Available Surface Runoff: 1.6 BCM/year. · Readily exploitable groundwater: 0.4 rising to 0.7 BCM/year. · Total available water during the four dry months: 45 percent of the total Annual Supply. In table 2.5, readily available and sustainable water supplies are assumed to be about 1.6 BCM/year of surface flow in rivers plus about 0.4 increasing to 0.7 BCM/year of readily available groundwater supplies from the aquifers. Of these about 0.9 BCM/year will be available during the dry four months of the year (when about 85 percent of the irrigation water will be required). This compares to dry season requirements of 0.9 BCM/year in 2003, 1.06 BCM in 2010, 1.36 BCM in 2020 and 1.76 BCM in 2030. This clearly indicates that the overall annual water balance will practically go into deficit just after 2020, while the dry season balance will be in deficit in 2004. To overcome the large dry season deficit over pumping will have to be relied upon to cover the deficit, at considerable economic and environmental cost associated with the resulting receding aquifers, unless the situation is improved by increasing the water storage capacity from its present level of 220 MCM to higher levels of about 500 MCM as well as taking drastic measures to improve the water supply and distribution efficiencies. Table 2.5 Total annual water demand and available supply (MCM/year) Category 2003 2010 2020 2030 Irrigation Water Demand 810 900 1,020 1,120 Domestic Water Demand 331 467 767 1,258 Industrial Water Demand 116 163 268 440 Total Annual Water Demand 1,257 1,530 2,055 2,818 Total Annual Supply 2,000 2,100 2,200 2,300 Annual Water Balance 743 570 145 - 518 Total Dry Four Months Demand 900 1064 1358 1757 Total Dry Four Months Supply 900 945 990 1,035 Dry Season Water Balance 0 -119 - 367 - 722 Scenarios for the Water Balance. If the population is assumed to increase by 1.5 percent annually, then annual deficit for 2030 would be around 125 MCM (deficit starting by Year 2027), while the dry season deficit by 2030 would be in the range of 535 MCM/year. In another scenario, if we assume that the total irrigated areas would only increase to 126,000 ha as recommended in this Note (Chapter 10), then the annual deficit for the same year would be about 406 MCM and the dry season deficit would be about 627 MCM/year. If both these two scenarios are combined, the annual deficit would only start to appear by the year 2030 and the dry season deficit for the same year would be about 440 MCM/year. In all cases, the need for additional storage will be warranted. 9 3. The Agriculture Sector ROLE OF AGRICULTURE IN THE ECONOMY Agriculture has always been a private sector activity in Lebanon in a market-driven economy. The budget of the Ministry of Agriculture (MOA) is typically one to two percent of the national budget. Agricultural income is exempt from income tax, and agricultural workers neither contribute to nor benefit from the country's social security system. Government is not involved in the production of agricultural or processed food products, but has provided the basic infrastructure, a macroeconomic policy environment, and services (roads, power, transport and communications networks, potable water and irrigation networks, agricultural research, and an ineffective extension service). Some of these services, such as water supply, wastewater disposal, and treatment facilities are not universally available or reliable. Within the context of a shrinking economy, loss of export markets, and sluggish growth in other sectors during the civil war (1975-90), the contribution of agriculture to Gross Domestic Product (GDP) peaked at 23 percent in the 1990s before falling after the end of the civil war to its pre-war level. (World Bank 2003a) The role of agriculture in the economy has been gradually eroding since the mid-1990s, and in 1997 it contributed 6.3 percent of GDP, and there is no evidence that its share has grown since then. This is lower than other countries in the region. Agriculture experienced wide fluctuations within a declining trend of annual rates of growth (8.6 percent in 1995 and 1.1 percent in 2000). At the same time, other sectors outpaced growth in agriculture, and in particular the manufacturing and services sectors. The main reasons for the low rate of growth of the agriculture sector include: a high cost structure in relation to neighboring countries, an over-valued exchange rate and high interest rates, an infrastructure that was either damaged or neglected during the civil war, and structural issues. A longer-term perspective, 1961- 2000, shows a positive trend in growth and productivity, with significant variation around this trend. During this period, crop production grew at an annual rate of 2.8 percent for the 1962-80 period, and at five percent for the 1981-2000 period, and was accompanied by a substantial increase in tractors and fertilizer use. Land productivity as measured by value added is high at US$7,000-7,500/ha in 1995 prices. Figures on agricultural labor productivity are not very reliable and need further analysis (World Bank 2003b). The value of agricultural production continued to increase, mainly in response to shifting cropping patterns that favored fruits, vegetables, and subsidized industrial crops (sugar beets, until recently, and tobacco), at the expense of cereals and pulses, and an increase in irrigated area from 41,000 ha in 1961 to about 90,000 ha in 2002 (FAO/MOA 2000). This value fell to LL1, 818 billion, or US$1,212 million, in 2001 (table 3.1), of which 71 percent, was the value of plant production, and 29 percent, the value of animal production. Fruits contributed 37 percent of the value of plant production, vegetables 29 percent, followed by industrial crops, 10.0 percent, and olives, nine percent. The value of animal production remained steady in the 1999-2001 period at around LL530 billion (US$353 million). 10 Table 3.1 Gross Value of Agricultural Production 1999 2000 2001 Category LL Billion percent LL Billion percent LL Billion percent Plant Production 1347 72 1405 72 1285 71 Animal Production 525 28 535 28 533 29 Total Production 1872 100 1940 100 1818 100 Note: Value is given at farm-gate prices. Source: MOA, Agriculture in Lebanon, 2000-2001, May 2002 (Arabic) Agriculture still plays an important role in the rural economy and its importance varies considerably among regions: employment in agriculture varies from 0.2 percent of the labor force in Beirut to 20.7 percent in the Bekaa (MOSA, UNDP 1998). Nevertheless, income from agricultural activities is often not sufficient to support farm families, and household members seek employment outside agriculture, either in rural or urban areas, to sustain their families. This trend is continuing and has led to internal migration towards the main cities, and to foreign migration. Women workers in agriculture get rewarded at about half the wage for men. For both men and women, wages in agriculture are comparable to or below the wages of unskilled labor, which provides an additional incentive for seeking employment in other sectors or outside rural areas, which accentuates rural-urban migration (World Bank 2003b). Agriculture (including animal products) accounts for about 20 percent of both total exports and total imports. The major exports are fruits (apples, citrus, bananas, grapes, and cherries), and vegetables (potatoes, tomatoes, and onions). The main agricultural export markets are Saudi Arabia and Kuwait, followed by Syria, Jordan, the United Arab Emirates (UAE), Egypt, and Bahrain. The United States, Syria, and the European Union are the largest exporters to Lebanon of grains (wheat) and flour, dairy products, meat, and fish (World Bank 2003b). It is noteworthy that Lebanon's exports to the European Union are negligible, which reflects the potential market that exists for high quality and high value added fruits, vegetables, and processed food products. AGRICULTURE IN THE LAST FIVE- YEAR PLAN Within the context of government's Five-Year Economic Development Plan for the 2000-04 period, which gave priority to the social sector, balanced regional development, and stimulating the productive sectors, MOA prepared a five-year plan for agricultural development (ESCWA 1999). This plan sought to increase the contribution of agriculture to the national economy and employment through investment in the sector, increasing income in rural areas and reducing rural-urban migration, and the adoption of policies for the sustainability of agriculture and natural resources. The plan envisaged an investment exceeding $400 million, including a $100 million credit scheme that would lead to an annual rate of growth in agricultural production of 15 percent, which is quite an ambitious undertaking, considering the historical performance of the agriculture sector. Due to the very ambitious nature of the development plan in agriculture on one hand and private sector- led development on the other, it is not surprising that many of these targets were not achieved, with one main exception. The target of increasing irrigated area to 74,000 ha has been exceeded. The current area equipped for irrigation is estimated to be around 90,000 ha. This is largely due to an increase in uncontrolled groundwater irrigation development by many smallholders, particularly during the civil war. The credit target has been partially met with International Fund for Agricultural Development (IFAD) financing agricultural cooperatives ($25 million) with participating banks, the European Union's (EU's) Economic and Social Fund for Development (ESFD, total 25 million Euros for rural development and 11 credit); the United States' Agency for International Development's (USAID's) Rural Community Development Cluster Program ($12-13 million annually for rural development and credit); and several NGO programs. The targets of increasing agricultural production by $325 million, increasing investment to around $600 million, and increasing agricultural exports by 45 percent to $242 million, have not been achieved (actually, the value of agricultural production fell to LL1818 billion in 2002 as shown in Table 6). Likewise, the objective of reducing imports has not been realized as imports of agricultural and food products continued to slowly rise, and the share of jobs in the agriculture sector continued to fall. 12 4. Main Features of Irrigated Agriculture WATER AND LAND US E Agriculture uses about 64 percent of the available resources. Table 4.1 gives the best possible estimates of the current breakdown of water resource use. Table 4.1 Estimates of water resources utilization (MCM/year) Item Surface water Groundwater Total Percentage Agriculture 490 320 810 17 Domestic 300 31 331 7 Industry 100 16 116 3 Neighboring Countries 743 200 943 21 Groundwater Recharge 850 150 1,000 22 Sea 700 700 1,400 30 Total 3,183 1,417 4,600 100 Source: Total figures given by FAO (1997) and IFAD (2000) with details revised as discussed with MOEW According to a village survey (1997) and the recent MOA Agricultural Census (1998) both conducted by FAO under the IBRD Agriculture Infrastructure Development Loan (Ln 4092-LB), the total arable land of Lebanon amounts to 248,000 ha or about 24 percent of the country's total land area of 1,045,000 ha (table 4.2). Table 4.2 Land resources and land use (1,000 ha) in Lebanon, 1998 Off-farm & Category On-farm Abandoned Farms Total Percentage Farm land 248 0 248 24 Permanent fallow 53 84 137 13 Forests and Garrigues 21 97 118 11 Non-cultivated land 50 423 473 45 Thereof with potential for agricultural use 35 75 109 10 Other (buildings, roads etc.) 4 65 69 7 Total 377 669 1,045 100 Source: République Libanaise (2002) : Draft Agricultural Strategy. Readily available sources of water, rather than land resources are limiting the expansion of irrigated agricultural production. The total area, which could be mobilized for short-term agricultural expansion (the current permanent fallow, 13 percent of the total land area) is equivalent to 55 percent of the 13 currently cultivated farmland. Another ten percent of the total area (equivalent to 44 percent of the current farm land) is classified as non-cultivated but with potential for agricultural use, yet requiring larger investments. Hence, in the long-term, Lebanon has enough land resources to actually double its agriculturally used area. Lebanon's agriculture is characterized by small and fragmented land holdings, limiting efficient large- scale irrigation and mechanization. Since the last agricultural census in 1961, the number of farms has increased by about one third (36 percent). With 195,000 farms cultivating a total of 248,000 ha, the average farm size measures about 1.27 ha. Three in four (73 percent) farms are smaller than 1 ha. Small farm areas are particularly frequent in the southern districts like Marja'ayoun and Bent Jbail. Farms in the North, particularly in Hermel, are larger than the national average (table 4.3). Table 4.3 Farm land in four selected districts and entire Lebanon, 1998 Item Akkar Hermel Marja'ayoun Bent Jbail Total Number of farms 22,577 2,979 7,522 7,581 194,829 Total farm area, ha 36,252 8,123 7,747 6,098 247,940 Thereof irrigated, ha 16,324 3,209 454 103 104,009 Proportion irrigated, percent 45.0 39.5 5.9 1.7 41.9 Farm area under greenhouses, ha 809 641 17 44 4,995 Proportion under greenhouses, 2.2 7.9 0.2 0.7 2.0 percent Average farm size, ha 1.6 2.7 1.0 0.8 1.3 Source: République Libanaise: GOL draft Agricultural Strategy (2000). Land Use. Present land use in Lebanon is summarized in table 4.4 below and is based on the land use map by Lebanon Agricultural Research Institute/FAO (1995). The data has not changed much despite the recent urbanization of last years, which was limited mainly to the suburbs of the major cities along the Mediterranean and due to the fact that irrigation schemes development have focused mainly on rehabilitation. About one quarter of the national land (10,452 km2) is used for the agriculture. Field crops (50 percent) and orchard (48 percent) dominate the agricultural land use. Spatial variation of the agriculture is consistent with topographical features. Arable land extends in the coastal plain near the northern and southern borders, and Bekaa plain, thus 41 percent, 23 percent and 12 percent of the agriculture land are located in Bekaa, North Lebanon and South Lebanon Mohafazats, respectively. Pasture is limited to animal husbandry and dominates the land use in Lebanon, accounting for 31 percent of the national area. Forests, which comprise 25 percent of the national area, are found mostly in mountain ranges along the Mediterranean Sea due to relatively high precipitation, while urban area (about six percent of the national area) is mainly located in the narrow coastal strip of the Mediterranean Sea, accounting for 75 percent of the total urban area. Since the Qaraoun dam with the surface water area of 12 km2 is located in Bekaa plain, almost 70 percent of the swamp and water land are located in Bekaa Mohafazats. About every second farm (51 percent) is irrigating at least part of its farmland. Irrigated farm areas have increased by 155 percent since the last agricultural census in 1961. However, the southern districts are low on development of irrigated farms where in Marja'ayoun and Bent Jbail only about 5.9 percent and 1.7 percent of farmland is irrigated, respectively, while in Akkar close to 45 percent of farmland is irrigated on average. 14 Table 4.4 Present Land use (km2) Mohafaza Mount North South Land Use Beirut Lebanon Lebanon Lebanon Bekaa Nabatieh Total Agriculture Land 0.05 348.94 780.92 418.47 1,405.65 453.64 3,407.65 Horticulture 0.05 19.94 9.98 29.16 6.03 1.27 66.42 Field Crops 0.00 50.68 319.50 88.79 1,003.51 232.18 1,694.66 Orchard 0.00 278.31 451.44 300.52 396.11 220.20 1,646.57 Grassland 0.13 430.56 430.22 146.14 1,887.86 343.63 3,238.54 Forest 0.20 808.39 654.33 301.88 617.41 248.84 2,631.06 Urban Area 19.12 285.08 106.16 77.94 86.81 78.97 654.07 Barren Land 0.31 158.70 81.16 7.01 251.57 2.16 500.91 Swamp/Water 0.02 1.26 2.62 0.17 9.97 0.02 14.05 Total 19.83 2,032.92 2,055.39 951.62 4,259.26 1,127.26 10,452.00 Source: Lebanon Agricultural Research Institute/FAO (1995) updated by JICA Interim Phase I Report. EXISTING AND PROPOSED IRRIGATION SCHEMES Although irrigation is the largest sector in water use, data to identify consumption of irrigation water, such as irrigated area, cropping pattern, cropping calendar, intake volume and so on, are very limited because the civil war has resulted in weakness of government capacity to handle extension service and water resources management. Thus, the existing irrigation schemes were identified based on the previous studies and confirmed through the discussion with authorities concerned. Two reports, "Irrigation in the Near East Region in Figures" (FAO, 1997) and "Global Result of Agriculture Census" (FAO/MOA, 2000) estimated the irrigated area respectively in 1993 and 1999 (see table 4.5). Table 4.5 Irrigated areas Equipped Cultivated Irrigation Irrigated Surface Sprinkler Micro Year Area (ha) Area (ha) Area (ha) Irrigation (ha) Irrigation (ha) Irrigation (ha) 189,206 87,500 * NA 53,500 21,000 13,000 1993 Ratio to the total equipped irrigation area 61 percent 24 percent 15 percent 248,000 NA 104,010 66,130 29,040 8,840 1999 Ratio to the total net irrigated area 64 percent 28 percent 8 percent * This figure does not match the one given in Chapter 3 para 3.2. Most probably the later is outdated. Source: FAO, 1997 for 1993 figures and FAO/MOA, 2000 for 1999. The total irrigated area of 104,000 ha given by the FAO/MOA census includes the areas that are not regularly irrigated (irrigated only once during the cropping period) and also very small land holdings such as 0.025 ha which may be classified as house gardens. The actual areas irrigated have therefore been estimated by MOEW and LRA at 90,000 ha and used in this Policy Note. Besides, the government has focused on the rehabilitation and modernization of irrigation schemes since 1994 without expansion of new schemes. 15 Through the inventory of previous studies and information from MOEW, 67 irrigation schemes were identified, covering mainly medium (between 100 ha and 1,000 ha) and large schemes (over 1,000 ha). The totalequipped area of those schemes is about 65,600 ha as listed in table 4.5 and table A1.2. Various crops are being planted in Lebanon, such as maize, potato, wheat, onion, tobacco, watermelon as field crops; tomato, cabbage and other green vegetables as market crops; and apple, grape, pear, citrus, cherry and olive as perennial/fruit crops. In order to estimate the water requirements for irrigation, those crops are simply categorized into three, namely cereals represented by winter wheat, vegetables, and fruit trees. An FAO/MOA Agricultural Census also gives irrigated areas classified by different sources of water such as surface water and groundwater. Of the irrigated farms, 48 percent are by surface water and 52 percent by groundwater. As for the methods of irrigation, surface systems, such as furrow irrigation is adopted on 64 percent of the irrigated area, while sprinkler and drip systems are adopted respectively on about 28 percent and about eight percent of irrigated land. Of the farms irrigated by surface water, about 86 percent use surface irrigation, nine percent use sprinkler irrigation, and five percent use drip irrigation. Of the farms irrigated by groundwater about 43 percent are irrigated using surface irrigation, about 45 percent using sprinkler irrigation and 12 percent using drip irrigation. Proposed and Under Implementation Irrigation Schemes: The JICA Phase I Interim Report of February 2003 reported that 12 irrigation projects are under detailed study or proposed for future implementation with a net irrigation area of 63,025 ha including 38,530 ha of new expansion areas. These are summarized in table 4.6 below. Table 4.6 Proposed and ongoing irrigation schemes Newly Expanded Area No Scheme Net Irrigation Area (ha) (ha) 1 Noura El Tahta Dam 5,000 2,300 2 El Bared Dam 750 0 3 Assi River Basin 6,700 6,700 4 Younine Dam 1,545 0 5 Southern Qaraoun Irrigation 550 500 6 South Bekaa (Phase II), Left Bank 6,700 6,700 7 South Bekaa, Right Bank and North 12,800 0 8 South Lebanon ­ Conveyor 800 13,230 13,230 9 Conveyor Anane-Nabatiyeh 3,500 3,500 10 Saida-Jezzine 1,200 1,200 11 Qasmieh-Ras El Ain (Phase II) 2,100 2,100 12 Khardale 9,000 9,000 Total 63,025 38,530 As a result of discussions between the Bank, the MOEW and LRA a revised listing of priorities and areas with cost estimates and tentative implementation program have been arrived at as presented in chapter 9 and Appendix table A1.2. The main conclusions from these discussions are that the GOL plans to increase the irrigated areas to about 140,000 ha from the current figure of about 90,000 ha by the year 2030, in addition to the rehabilitation and modernization of about 30,500 ha of the existing areas. 16 CROPPING PATTERNS Table 4.7 below gives the percentage of area cropped under each of the main crops in each of the five Mohafazats and for Lebanon in general. Lebanon's richness in agro-climatic conditions, from the Mediterranean Sea to the Syrian desert and from sea level to above 3,000 m above sea level, provides the basis for a high diversity in crops grown in the country. While agricultural production in the coastal plains is dominated by citrus fruits, vegetables, tobacco, figs, and bananas, higher altitudes support the production of apples, pears, peaches, cherries, and olives. Cereals are predominantly produced in the Bekaa valley. Table 4.7 Cropping pattern in the Mohafazats (percent) North Mount South Total Crop Production Lebanon Bekaa Lebanon Lebanon Nabatiyeh Lebanon Cereals 18.9 28.9 1.2 12.7 22.9 20.9 Vegetables 20.2 25.2 12.1 7.0 4.7 18.2 Industrial crops 5.9 14.9 0.6 4.9 15.4 10.0 Fruit Trees 21.3 21.1 38.1 41.7 8.0 24.0 Olives 32.9 3.1 30.3 30.2 44.6 21.1 Other Crops 0.8 6.8 17.7 3.4 4.5 5.7 Total 100.0 100.0 100.0 100.0 100.0 100.0 Source: GOL draft Agricultural Strategy (2003). Some technical weaknesses include: a. present lack of a national water master plan. MOEW is aware of this constraint and is in the process of preparing a Water Resources Master Plan for Lebanon (financed by the Japanese Government); b. low irrigation efficiency and very low adoption rate of water saving technologies. It is estimated that around 70 percent of the irrigated area relies on furrow irrigation). Therefore water saving technologies should be gradually introduced; c. degradation of water quality and pollution of surface and ground water with waste water, industrial waste, and excessive use of chemicals in agriculture. A prime example of this is the high level of pollution in the Qaraoun reservoir (chapter 6 deals with this aspect); d. uncontrolled well drilling and pumping, and illegal removal of flow limiting devices by users in some areas, resulting in a significant lowering of the water table, increased salinity, and salt-water intrusion; and e. lack of reliable data on water resources availability due to the lack of accurate meteorological and hydro-geological information that are essential for planning purposes. To this end, the MOEW and LRA should improve the meteorological and hydrological data collection and analysis. 17 5. Current State of Water Quality and Pollution Control Data on surface and ground water quality in Lebanon is limited as there is no comprehensive monitoring program for water resources. Major pollution sources of the water resources are direct discharges of municipal and industrial wastewater, uncontrolled solid waste disposal as well as leaching of pesticides and fertilizers from agricultural lands. Another source of water pollution that is under-estimated is sea water intrusion as a result of over exploitation of groundwater. Measurements of Electric Conductivity (EC) of rivers (10 no) and springs (210 no) that were recently conducted indicate that EC range from about 200 to 2000 µS/cm with an average of about 500 µS/cm, thus showing that water resources in Lebanon are generally suitable for irrigation as far as salinity is concerned, although precautions have to be taken in few cases (Jouzy and Partners 2003). Nevertheless, pollution is widespread and there are several documented reports confirming the pollution of several if not most water resources. For instance, the United Nations Children's Fund (UNICEF) report on the Quality of Potable Water in Lebanon has indicated that 60 to 70 percent of all natural water sources are affected by bacterial contamination (Jurdi 1998). Contamination of springs appears to be lower than that of rivers. Results of water quality analyses conducted by Jouzy & Partners for 17 springs and 16 rivers revealed that only two springs have coliform counts above World Health Organization (WHO) permissible limit for irrigation of crops to be eaten raw, while 90 percent of tested rivers exceed the WHO limit. The pollution of Litani River, which is the largest river in Lebanon, is becoming a serious issue. The discharge of untreated municipal and industrial effluents, the drainage from agricultural lands, and the uncontrolled discharge of solid wastes directly into the river and its tributaries have considerably degraded the water quality of Litani and limited its use. Results of water quality analyses of Litani and Qaraoun catchment area revealed that in many spots, concentrations of COD (250 mg/l and higher) are sometimes similar to untreated wastewater (MVM Konsult AB 2000). Wastewater Networks. An important percentage of the population, especially in urban areas is served by sewerage systems. However, most of the existing wastewater networks are either damaged or are undersized. Rehabilitation works are taking place and wastewater collection designs are under preparation for major cities. However, until now all collected wastewater is discharged without any treatment into rivers, streams, groundwater (through open wells), wadis and coastal water. Wastewater disposed into rivers is used downstream for irrigation and in some cases for drinking purposes. This has resulted in the spread of waterborne diseases such as typhoid, dysentery and diarrhea. Laboratory analyses conducted by Jouzy & Partners in July 2002 and January 2003 for JICA, to assess water quality in ten rivers, revealed high levels of total coliforms (up to 55,000 MPN/ml in one case) and electrical conductivity (up to 1297 µS/cm in another case). An increase in coliform counts and salinity levels between the upstream and downstream of most rivers was observed, which confirm the presence of various sources of pollution along the rivers. In the absence of a continuous water quality-monitoring program along rivers, it is difficult to identify the time period and to delineate the exact parts of the rivers that are not polluted and that could be used without restriction. Wastewater Treatment. The only operating wastewater treatment plant in Lebanon is the Ghadir treatment plant which, was designed to serve 300,000 persons and includes only primary treatment. The feasibility of upgrading this treatment plant to provide secondary treatment is being assessed. In parallel, more than 19 25 wastewater treatment plants have been planned to serve major cities of which seven are under construction. Details of the planned treatment plants are provided in table A3.1. Several municipalities and communities have also made arrangements to improve wastewater collection and disposal. Through the assistance of international donors and NGOs, a number of small-scale wastewater treatment plants have been implemented in various communities. To date more than fifteen of these plants are operational, they provide a secondary treated effluent that is being used for irrigation. Implementation of wastewater treatment plants by the Government and by the communities is therefore on going and it is expected that by 2006 more than 25,000 m3/day of treated effluent could be made available to irrigate around 300 hectares as most of the treated water from the major coastal cities would be discharged to the sea as per GOL decision. In the long-run, the maximum area that could be irrigated using treated sewage effluent is estimated at present at about 3,000­5,000 ha. Industrial Wastes. Industrial wastes are also discharged without any treatment into various receiving water bodies. The estimated volume of untreated industrial effluent discharged is around 35 MCM/year with an estimated BOD load of 5,000 tons/year (Teboddin 1998). Industries are concentrated along the Mediterranean coast and in the Bekaa valley and include various types of industrial activities. In the Bekaa area, major water sources such as the Qaraoun Lake, Litani and Berdawni rivers are heavily contaminated as they receive untreated industrial effluents from sugar-beet factories, paper factories, lead recovery plants, limestone crushers, agro-industries, poultry farms, tanneries and slaughterhouses. In the absence of a pollution control strategy with the necessary legal and regulatory instruments, industrial discharges remain an important pollution source. Finally, there is no major re-use of treated wastewater. However, the use of raw sewage for irrigation has been reported in several areas. According to the UNICEF report around ten percent of the wastewater is used for irrigation. Agricultural Pollution. Over-abstraction of groundwater for irrigation has resulted in considerable decline in the water table level and increase in salinity. Data reported by the American University of Beirut (AUB) Water Research Center, indicate that chloride and sodium concentrations in several wells across the country are relatively high and would not allow the use of such water for un-restricted irrigation, as it would have a negative impact on crop production. The use of such water for irrigation purposes would necessitate selecting salt tolerant species, leaching of the soil to avoid salt build up, providing adequate drainage and selecting appropriate irrigation techniques. As shown in table 5.1, higher levels of sodium and chloride are reported along coastal wells and are attributed to seawater intrusion as a result of water abstraction rates higher than the rate of recharge. In addition, the use of fertilizers and pesticides are poorly regulated and monitored. It was reported that in 1999 Lebanon imported 1,530 tons of pesticides and around 32,000 tons of fertilizers. Although there is no systematic and regular monitoring of ground water quality, there are several indications of ground water pollution by agro-chemicals. Groundwater surveys conducted by the AUB, revealed that nitrate concentrations in locations adjacent to agricultural areas are exceeding the Lebanese maximum permissible limit of 45 mg/l for drinking water. Pesticides residues were also detected in trace concentrations, however at concentrations less than the advisory limits set by United States Environmental Protection Agency (USEPA). Pollution Control. In spite of the rising official and public awareness about the state of the environment and the pollution of surface and ground water, the ten years water strategy developed by the MOEW does not address water quality or the need to protect and preserve water resources from pollution and there is no comprehensive framework for pollution control. One of the most important requirements for developing a comprehensive water quality management and pollution control plan is to establish a well functioning water quality-monitoring network. Such a plan has not been developed and there are no monitoring sites along streams, rivers, springs or irrigation channels. Another important requirement is to establish and implement the polluter/payer concept whereby industries and consumers should be encouraged to pay the Regional Water Authorities (RWAs) or any other responsible bodies for the pollution they generate. 20 Table 5.1 Chloride and sodium concentrations in 31 wells across the country Area No. of Wells Sodium (mg/l) Chloride (mg/l) Inland Wells Brital 3 33 550 HE Sneid 1 35 235 Qsarnaba 1 36 250 Sadneyal 2 78 383 Niha 1 62 240 Coastal Wells Cheka 3 1437 415 Selaatah 1 15 140 Batroun 2 273 153 Houboub 1 720 345 Berbara 1 2700 950 Remeyleh 3 3100 637 Jiyeh 3 503 458 Choueifat 8 460 204 FAO Degree of Restriction on Use § None < 68.97 mg/l < 141.6 § SlighttoModerate 68.97 to 206.91 141.6 to 354.0 § Severe >206.91 >354.0 Legal and Regulatory Framework. Existing laws and regulations for water quality and for the protection of water resources in Lebanon date as back as 1925. These laws were neither updated nor complemented with additional laws and application decrees. Moreover, there are very limited laws related to wastewater disposal and reuse, solid waste discharge, industrialwastewater discharges, agriculture drainage and other water polluters. A list of available laws for the pollution and protection of water resources is given in Appendix table A3.2. Recently, Decision No. 8/1 dated March 2001 reviewed the previously issued wastewater standards to cover the discharge of wastewater to the sea, to surface water and to sewerage systems (Ministry of Environment, Lebanon 2001). However there are no national irrigation water quality standards or guidelines. The main agencies in charge of water quality monitoring are the MOEW and the Ministry of Public Health (MOPH). The RWAs are also responsible for monitoring the quality of drinking water, irrigation water and wastewater. All RWAs face major operational and staffing problems. The RWA for Beirut and Mount Lebanon is the only water authority that has a well-equipped laboratory for measuring various water quality parameters including trace metals and pesticides. However, it does not have sufficient financial and human resources to undertake proper monitoring for water, wastewater and irrigation. In addition, the MOE is responsible to fight pollution from all sources by taking protective measures including conducting studies regarding ways and means for waste and wastewater treatment. The ministry is also responsible for setting water standards, permitting the establishment of various classified establishments and enforcing legislation. However, the MOE lacks resources and has limited capacities in monitoring and enforcement. 21 RECOMMENDAT IONS Water Quality Monitoring. The Government will have to make a major effort to improve water quality monitoring in order to ensure proper water management. In this respect, a reconnaissance survey of the status of water quality and the sources of pollution should be conducted to enable the development of a sustainable and cost-effective water quality-monitoring program. Currently public institutions and research centers conduct sporadic and intermittent water quality analyses, and these efforts concentrate on monitoring drinking water quality. Little attention is given to the quality of irrigation water and its ultimate impact on agricultural production and public health. Moreover, available water quality data is localized in time and space and therefore cannot be used for a meaningful analysis of trends. All concerned public and private agencies need to work together to establish a national water quality program for monitoring surface and ground water resources. A pilot project to develop and establish a monitoring network for water quality in the Litani Basin is highly recommended. This monitoring program could include: · standards that should be applied or revised and/or prepared; · locations and activities to be monitored; · parameters to be measured and the frequency of measurement; · actions and mitigation measures to be implemented under various conditions; · an enforcement mechanism; · personnel and equipment; · public awareness campaigns; · identification of irrigation requirements for different water quality; and · a reporting mechanism. Wastewater Reuse. The Government has made some progress in the execution of wastewater collection and treatment networks; however, considerable efforts are still required. The development of cost- effective technologies for collecting, treating and disposing/reusing wastewater in small, rural communities should be a priority issue. Local solutions to wastewater management in small rural communities would offer a sound measure for reducing the pollution of water resources and an alternative source of water for irrigation. So far, a variety of treatment techniques have been adopted by some communities to implement smallscale wastewater treatment plants, however the capability of these treatments plants to produce a treated effluent that can be safely used for irrigation is questionable and there are still several rural communities lacking such facilities. Large-scale use of treated wastewater in irrigation does not appear to be viable in many areas because of high production and conveyance costs. The most likely places for its use are along the coast where vegetables and some fruits are grown. However, treated wastewater will not be used for vegetables for both sanitary and cultural considerations. The institutional set up for wastewater reuse requires special attention through better organization and regulation on the basis of well defined standards and specifications as well as practical guidelines and operational rules. At present there is no regulatory framework for the reuse of treated wastewater. Finally potential environmental and health impacts associated with the reuse of treated effluent should be properly disseminated to all concerned stakeholders. Training of government officials and farmers on the management of irrigated agriculture using treated effluent should be considered. Pilot projects for testing different technologies and practices for the reuse of treated effluent from municipal treatment plants are also recommended. 22 Capacity Building. The capacities of the MOEW, the RWAs and the LRA in terms of organization, staffing and equipment for water quality management require immediate attention. Strengthening the capacities of these authorities for water quality testing, data analysis, quality assurance and control as well as databases and reporting is needed. A survey of available laboratory capacities should be conducted to identify required laboratory equipments for conducting a proper water quality monitoring. The capacities of the MOE for pollution abatement and enforcement of legislation should be also strengthened. A program for strengthening national capacities should also be developed and shall include the provision of technical assistance and training programs in water quality management with special emphasis on: · Planning and management of irrigation water; · Re-use of treated wastewater for irrigation; · Irrigation techniques and requirements for different water quality; · Establishment of a data base on water quality and pollution sources; · Dissemination of information on water quality; · Communities and private sector participation; and · Public awareness. 23 6. Institutional Aspects WATER LAW AND WATER RIGHTS FAO provides an overview of existing laws and their administration, most of which were formulated by the Ottoman Empire and modified and used by the French Mandate, who introduced the first water laws in Lebanon in 1925 and 1926 (Caponera, 1973). These laws refer to the organization and description of "water rights" for individual water owners (for more details refer to Appendix 5). There is certain lack of defined set of laws governing water ownership and use. The first law declaring water resources as a public property, aside from established water rights, was issued in 1925. In 1926, the French Mandate introduced a new law, which refers to the organization and describe "Water Rights" for individual water owners. In 1930, the GOL issued a decree, which considers that all water in privately owned land is the property of the landowner and is privately owned, thus changing what was stipulated in the previous laws. A large number of concessions and water committees have been created in the few decades before and after the end of the French Mandate over Lebanon. Since 1951 the GOL issued some 22 decrees dealing with the creation of water authorities in the country. The aim was to take ownership of water resources from individuals, organize water use and solve, at least temporarily, water use problems in order to cope with economic and industrial growth in Lebanon. Water Rights. Lebanese legislation considers that all kinds of water resources are public owned except for the rights that were vested before 1925, i.e., the period when the Ottoman rules were still applicable. The vested interests upon water resources are considered as a principle in the Lebanese society, because they are related to the customs and traditions, through many generations. In addition the 1925 law considers that anyone used to consume water resources for his own profit without any disputes, "i.e. the consuming of the water resources, must be apparent" will have a water right (not personal), but the decision never determined the period of this water right. Finally, a decision of a civil appeal court in 1968 considered that: "There's a possibility of consuming the non flooded water wells that are excavated in the private property, and flows daily up to l00 m3 without a governmental permission" and individuals can not consume the stream's water when it flows for more than 100 m3. ORGANIZATION OF THE WATER SECTOR Numerous governmental, autonomous and semi autonomous agencies are involved in the water sector. Their responsibilities are inter-related and therefore it is difficult to discern a clear authoritative system linking promulgated decrees to the corresponding and appropriate agencies (MOEW, LRA, MOA, etc.). Historical perspective The main institutions involved in the water sector are described here below. Ministry of Energy & Water (MOEW). Created in 1966, the Ministry of Hydraulic and Electrical Resources (MOHER), now MOEW, has the following mandates: 25 · protect and develop hydraulic natural resources; · assume jurisdiction over the water resources in Lebanon; · study supply and demand, and global situation of the water resources in Lebanon; · prepare the national water master plan; · design, implement and operate large hydraulic facilities; · conserve and control the water resources including surface and underground water; and · exercise administrative supervision over the WAs and the LRA. MOEW has two General Directorates (figure 6.1). The largest of the two: the Directorate General of Hydraulic and Electric Resources (DGHER) is responsible for research, studies and implementation of large-scale projects. The second one is the Directorate General for Operations is responsible for overseeing the public establishment, for administration and financial aspects and for mines and quarries. MOEW exercises administrative supervision over the RWAs, the autonomous Water Boards and Local Committees through the Directorate General of Operations (DGO). MOEW has about 212 staff against 578 assumed positions (2002 figures) including 60 engineers. Due to the ban on new recruitment by the public sector, the average age of MOEW staff is quite high. In recent years, some new recruitment and transfer from the other ministries were made on exceptional basis. MOEW's average yearly budget is about US$85 million and irrigation represents ten percent of this total budget. Water Authorities. Under MOEW tutelage, and before the establishment of the four Water Authorities (WAs) in 2002, the Litani River Authority (LRA) and the 22 Regional Water Authorities--RWAs (table 6.1) operated with various degrees of autonomy. In addition, there are 209 local water and/or irrigation committees, which were formed between 1984 and 1990 (table 6.2). These local committees are under the tutelage of the RWAs. Out of these 209 committees 18 percent are for potable water, 60 percent are for irrigation, 14 percent for both potable water and irrigation and eight percent have no clear mandate. The 22 RWAs were/are mainly charged with management of potable water, under the supervision of the MOEW, except for two RWAs (Barouk and Baalbek/Hermel which also deal with Irrigation). About 15 percent of these water committees are jointly run with the municipalities. These RWAs are responsible amongst other for setting the water fees for potable, irrigation and industrial uses which are approved by MOEW. According to available data they serve about 3.5 million people. The RWAs are created by governmental decrees and their board members, usually between seven and nine, are appointed by the Council of Ministers; whereas the Local Committees are created by a ministerial decrees and their Board members, usually five, are appointed by the Minister of Energy and Water. Table 6.1 also shows the number of the Irrigation Water Boards and Regional Committees, the population they serve and their location. Only Beirut Water Office, Tripoli Water Board and the Litani River Authority were given the power to study and develop their systems. 26 Table 6.1 Regional water authorities No Regional Water Authority/Committee Caza Population North Lebanon Mohafazat 1 Tripoli Water Board Tripoli & Akkar 481,000 2 Nabaa Al-Ghar Water Committee Koura 77,000 3 Kubayat Water Board Akkar 31,000 4 Nabaa Al-Kadi Water Committee Zgharta 59,000 5 Becharre Water Committee Becharre 33,000 6 Batroun Water Committee Batroun 50,000 7 Akkar Akkar * 8 Danniyeh Tripoli (Danniyeh) * Beirut Mohafazat 13 Beirut Water Board Beirut, Metn & Baabda 805,000 14 Ain el Delbeh Water Board Mount Lebanon Mount Lebanon Mohafazat 9 Barouk Water Board Baabda, Aley & Chouf 239,000 10 Keserouane Water Board Keserouane 45,000 11 Metn Water Board Metn 149,000 12 Jubail Water and Irrigation Com. Jubail 74,000 South Lebanon Mohafazat 15 Sour and Surroundings Water Board Sour 185,000 16 Saida Water Board Saida 132,000 17 Ain Ed-Delbeh Water Board Baabda, Aley & Chouf 420,000 18 Jabal Amel Water Board Marjayoun, BentJbail, Hasbaya Sour 117,000 19 Nabaa El-Tasseh Water Board Saida Jezzine, Nabatiyeh & W. Bekaa 218,000 Bekaa Mohafazat 20 Zahle and Surroundings Water Board Zahle & West Bekaa 146,000 21 Baalbek Hermel & Irrigation Board Baalbek & Hermel 200,000 22 Chamsine Water Board Zahle, W. Bekaa, Rachaya & Hasbaya 85,000 Total 3,546,000 *Included with Tripoli 27 Figure 6.1 Organization of Ministry of Energy and Water Minister Energy and Water Director General, Operations 1/1 Director General 3/3 Hydraulic & Electric Resources Mines and Quarries 0/6 Director, Technical Study 4/23 1/3 Hydrology Director, Control for Concession Research & Technical 11/29 Facilities Department Technical Control Department 4/6 Hydraulic Research Water Works Hill Lakes Administrative & Financial 5/9 Control Department Geology Department 16/49 Staff and Accounting Groundwater Legal Geology Exploitation & Water 12/37 Director, Overseeing 2/3 Rights Department Public Establishment Land Acquisition Water Rights Electricity Department 4/5 Director Water 1/4 Water Department 6/9 Implementation Department 57/120 North Lebanon Mount Lebanon Bekaa Secretary Department 18/31 South Lebanon Irrigation Department 7/22 Studies Department 7/34 Environment Department 7/31 Electrical Equipment Department 5/29 Planning Department 7/32 Statistics Programming Electricity Planning Water Planning Administration Department 34/92 Staff Office equipments Accounting Legal Archive Numbers in the boxes reflect the number of existing/assumed staff. The total for DG Operations is 41/73, for DG H&ER, it's 171/505. Names with no boxes are sections or units of H&ER. Source: DG Operations and DG as of August 2002. 28 Local Committees. Table 6.2 describes the 209 Local Committees (LCs) with their locations and functions. These Committees were mainly established after the civil unrests of the 1980s. In general, the role of these Committees is restricted to the operation, maintenance, rehabilitation and renovation of the networks and equipment. This keeps the responsibility for studying water requirements, development of water resources and design and execution of extension of existing networks with the MOEW. Out of these 209 LCs, there are 25 Irrigation Committees, which are at present efficiently undertaking the O&M tasks (out of a total of 120). These Committees could easily form the nucleus of the proposed new organization based on Water Users' Associations. Table 6.2 Local water committees formed between 1984 and 1990 Number of Committees Serving Each Purpose Potable + Mohafazat Caza Potable Irrigation Irrigation Undetermined Total Akkar 2 10 4 1 17 Batroun 1 6 3 - 10 Becharre 2 3 5 1 11 Koura North Lebanon - 2 - - 2 Tripoli 1 6 4 2 13 Zgharta 2 6 2 1 11 Akkar* - - - - - Danniyeh* - - - - - Sub Total North Lebanon 8 33 18 5 64 Beirut Beirut - 1 - - 1 Sub Total Beirut 0 1 0 0 1 Aley 2 7 1 1 11 Baabda 3 1 - 1 5 Mount Lebanon Chouf 3 16 1 2 22 Jubail 3 10 2 2 17 Keserouane - 5 1 - 6 Metn - 8 - - 8 Sub Total Mount Lebanon 11 47 5 6 69 Bent Jubail 1 1 - - 2 Hasbaya - - - - - Jezzine 2 3 - 2 7 South Lebanon Marjayoun 1 - - - 1 Saida - 1 3 4 Sour - - - - - Nabatiyeh 1 1 - 1 3 Sub Total South Lebanon 5 6 0 6 17 Baalbek 2 18 - - 20 Hermel - 8 - - 8 Bekaa Rachaya - 2 - - 2 Bekaa West 8 5 - - 13 Zahle 4 8 3 - 15 Sub Total Bekaa 14 41 3 0 58 Total 38 128 26 17 209 29 The Litani River Authority (LRA). In 1954, the LRA was established to: · develop the Litani River Basin domestic, irrigation and hydropower water schemes; · develop a nationalinterconnected power grid, and · build electrical power stations and distribution networks in all Lebanese territory. In 1955, the LRA was given the technical and the financial power for operating and exploiting all Litani River Basin related projects. In 1962 this power was expanded to include a water development plan for all the Litani/Awali basins and the area between the international Beirut--Damascus road and the southern Lebanese boundary. The LRA has four departments (Irrigation Operation, Hydropower, Technical and Administrative) and an Accounting Unit. In 2002, LRA had 275 employees including 21 engineers. Due to ban of new recruitment in the public sector, the average age of staff is quite high and their number is gradually decreasing. LRA 2003 budget amounted to approximately US$17 million. Irrigation related expenditures are approximately estimated at US$3.75 million or about 15 percent of the whole budget. Council for Development and Reconstruction (CDR). The CDR is the principal economic and physical planning and development agency of the central government. In 1977, the law gave CDR the responsibility of selecting, in cooperation with line ministries, the institution or combination of institutions required for implementation of projects financed by donors. Municipalities. In 1997, the law reaffirmed that the municipalities will be responsible for preparing general plans for works related to sanitary and water projects, as well as for the establishment of sewage disposal facilities, and for matters concerning protection of the environment and pollution control. The Ministry of Interior & Municipalities is the tutelage ministry of municipalities. Wastewater. There is not a single specialized authority that is responsible for all wastewater activities in Lebanon, and charged with setting standards and criteria for design, construction and disposal, and to plan future development. Overlapping of responsibilities is one of the major factors that lead to the inefficiency of the governmental institutions responsible for wastewater. The MOEW has the main responsibility for wastewater and its Directorate of Hydraulic and Electric Equipment is responsible for the design and execution of storm-water and flood control projects. In 1972, MOEW was given the responsibility for studying, collecting and disposing of storm-water and wastewater. In 1973, an Environmental Improvement Department in the MOEW was established with particular responsibility for the disposal of wastewater. Its responsibilities included both study as well as implementation. Other Organizations. There are also other organizations dealing to a lesser extent with irrigation such as the MOA and the Green Plan (GP). MOA deals with aspects such as research, extension and training while the GP deals with land and water conservation, land reclamation, rural roads and construction of small hill lakes. The current situation In 1972, the Lebanese Government issued a decree aiming at organizing all the water authorities into four Authorities following the administrative boundaries of the Mohafazats. It also created a Superior Water Planning Board within the MOEW; the "National Water Council" presided by MOEW's Minister to ensure the coordination between all the water authorities and other administrations and to establish a water policy. This decree was never implemented and as the management of all these large number of regional water authorities, committees, etc. became very difficult as each one tried to develop its own resources, to conduct its own activities single-handed, assisted in few instances by the MOEW. As a consequence, the MOEW was not able to oversee the work and assess the activities of these authorities 30 and committees. In 1998, a new decree was issued organizing all Regional Water Authorities into four authorities: North Lebanon, Beirut & Mount Lebanon, South Lebanon and Bekaa (table 6.3). Table 6.3 Recently created water authorities New Water Local Committees Authority No. Old Water Authority Potable Irrigation Total* 1 Tripoli Water Board 2 Nabaa Al-Ghar Water Committee 3 Kubayat Water Board 1 ­ North 4 Nabaa Al-Kadi Water Committee 8 51 64 Lebanon 5 Bcharri Water Committee 6 Batroun Water Committee 7 Akkar 8 Danniyeh 1 Barouk Water Board 2 Keserouane Water Board 2 ­ Beirut & 3 Metn Water Board Mount 11 52 69 Lebanon 4 Jubail Water and Irrigation Committee 5 Beirut Water Board 6 Ain el Delbeh Water Board 1 Sour and Environs Water Board 2 Saida Water Board 3 ­ South 3 Ain Ed-Delbeh Water Board 5 6 17 Lebanon 4 Jabal Amel Water Board 5 Nabaa El-Tasseh Water Board 1 Zahle and Environs Water Board 4 ­ Bekaa 2 Baalbek&HermelWaterandIrrig.Board 14 44 58 3 Chamsine Water Board * Including undetermined Committees. Again in April 2000, the Lebanese Parliament approved a new law (No. 221) concerning the organization of the water sector. The law (appendix 5) deals mainly with the following issues: a. the MOEW mandate; b. the creation of the four new Public Investment Authorities (known as Water Authorities--WAs; including Greater Beirut) with their mandates and their internal organization; c. the creation of a committee responsible for the evaluation of the WAs performance; and d. the continuation of the present arrangement with the Regional Water Authorities and Local Committees for the next two years until they could be fully incorporated in the newly established WAs. Although the law was published in year 2000, The presidents and the six members of the WAs Boards were only appointed late in 2002 delaying the effective application of the law. These WAs are supposed to take over the management of the irrigation, potable water and sewerage schemes, but due to the technical, administrative and financial constraints described below, they are physically not able to undertake these tasks bestowed upon them by the law. The management of the 31 irrigation as well as the sewerage schemes is still in the hands of the Irrigation Boards, the Local Committees, etc. and there are no immediate plans to shift the management of these schemes to the WAs. Weaknesses of the present system The water sector in general, and the irrigation sector in particular, have several weaknesses that need to be addressed to mitigate the impact of water scarcity that will face Lebanon in the coming two decades. Following the review of water laws and water rights, and the establishment of the four WAs, a number of weaknesses or constraints became apparent. These weaknesses can be grouped into three categories: institutional/administrative, technical, and financial, as briefly discussed below. The GOL has taken an important step in consolidating water resources management namely, municipal and industrial water, irrigation water, and wastewater, under the same management in each of the 4 newly established WAs (with the exception of areas that fall within the jurisdiction of LRA). This represents a very important and necessary step towards adopting a holistic approach for managing water resources. The main institutional and administrative issues affecting the irrigation sector, include: · delays in issuing executive regulations and bylaws of the new WAs to empower them with administrative and financial autonomy;6 · fragmentation and lack of cooperation or coordination of agencies in charge of water resource management: MOEW, LRA, WAs, RWAs and local water committees are involved in water resource management with overlapping functions; · the new WAs lack adequate technical staff needed to manage water resources, and have an excess of administrative staff; the WAs have focused their current efforts on supply of water for municipal and industrial uses; · lack of participation by the stakeholders in project design, implementation, or O&M, and the absence of Water User Associations--WUAs (although some of the local water committees play a similar role); · laws and regulations governing the water sector were promulgated under Ottoman and French codes have not been updated to deal with emerging issues such as acquired water rights, and legal framework for the establishment and operation of WUAs; and · lack of enforcement of existing regulations regarding issuing permits for well drilling, distances between wells or drilling near springs. All WAs share several common problems: delays in issuing their bylaws and standardizing legal, financial, and staffing affairs; delays in approval of proposed bylaws and WAs organigrams by the MOEW; the dearth of technical staff; very low procurement limits; inadequate budget and indebtedness; customers unpaid bills, lack of financial resources to improve the present networks and add new ones; many employees are near retirement; lack of maps showing water supply networks; high network losses; low collection rates (25 percent in Zahle, minimal in Baalbek, 45 percent in Tripoli); high debts and customers unpaid bills. In short, although WAs in principle have autonomy, they cannot yet operate on a commercial basis. For details of the WAs present situation refer to table 6.4. 6As an illustration, the chairman of the Beirut and Mount Lebanon, the largest WA, has the authority to spend only LL1.0 million (US$670) on procurement without bidding (LL3.0 million for the board); beyond that, he has to follow bureaucratic procedures and red tape. 32 It is worth mentioning that WAs are actively seeking a greater participation by the private sector in water resource management. The WA for North Lebanon has reached agreement with, and handed over to, a French company, the management of water distribution, O&M, and collections for the potable water system in Tripoli on a trial basis for one year. The USAID will finance a study for the WA for South Lebanon to improve performance and financial position as a perquisite for privatization of management of the potable water system in Sidon. The chairman of the WA for the Bekaa expressed the desire for the private sector to assume responsibility for managing the water supply systems in Zahle and Baalbeck. All WA chairmen share the same vision of eventually handing over management of the potable water systems in the main cities to the private sector. Furthermore, they expressed the need for farmers and their local water committees to assume O&M functions of schemes that serve them through the establishment of WUAs, to ensure their sustainability, since government has stopped subsidizing these schemes. However, this requires a legal framework to govern WUAs. RECOMMENDATIONS The GOL and MOEW are commended for passing legislations for the planning, consolidation and improvement of water resource management. However, some areas still need attention. The present Note recommends the following: a. Accelerate issuing the executive regulations and bylaws to empower the WAs with the autonomy envisaged by Water Law No. 221 of May 2002. The spending limit by the Chairman and the Board should be raised and reviewed periodically to enable the WAs to operate on a commercial basis; b. Give WAs autonomy to appoint key technical staff to fill gaps in the present organization, and gradually phase out redundant administrative staff; c. pass legislation to update the laws regulating the water sector and provide a legal framework governing Water Users' Associations, and addressing the issue of acquired water rights, among other things d. Involve stakeholders in the O&M functions (refer to Chapter 7); e. enforce regulations and payment of penalties regarding well drilling and abstraction, including distance between wells and from springs; f. start/complete the computerization of customers data base including connections, Billings and collections; and g. enforce regulations related to water quality standards. 33 Table 6.4 Water Authorities General Characteristics Committees Subscribers Employees Financial (US$ million) ( & (1,000) (1,000) & (US$ Rate Bills New Water Irrigation Authority No. Old Water Authority Offices Domestic Domestic Irrigation Irrigation Total No. Schemes Domestic Irrigation Total Engineers Technicians Salaries mio) Annual Budget Debts Unpaid Recovery percent) 1 Tripoli Water Board 2 Nabaa Al-Ghar Water Committee 3 Kubayat Water Board 1 ­ North 4 Nabaa Al-Kadi Water Committee Lebanon 9 8 18 33 64 10 105 9 350 45 2.4 10.6 12.0 16.6 15-20 5 Bcharri Water Committee 6 Batroun Water Committee 7 Akkar 8 Danniyeh 1 Barouk Water Board 2 Keserouane Water Board 2 ­ Beirut & 3 Metn Water Board Mount Lebanon 20 11 5 48 70 14 450 6 1,170 120 11.3 75.0 6.0 54 50-60 4 Jubail Water and Irrigation Committee 5 Beirut Water Board 6 Ain el Delbeh Water Board 1 Sour and Environs Water Board 3 ­ South 2 Saida Water Board 9 5 0 6 17 5 114 0 135 30 3.6 20 1.8 32 15-20 Lebanon 3 Ain Ed-Delbeh Water Board 4 Jabal Amel Water Board 5 Nabaa El-Tasseh Water Board 1 Zahle and Environs Water Board Baalbek & Hermel Water and 4 ­ Bekaa 2 7 14 3 41 58 18 51 14 364 31 1.2 6.2 20.0 21.5 15-20 Irrig. B. 3 Chamsine Water Board TOTAL 22 7RWDO 45 38 26 128 209 47 720 29 2,019 226 18.5 111.8 39.8 124.1 20-30 34 7. Operation and Maintenance, Tariffs, and Cost Recovery OPERATION AND MAINTENANCE Despite the various irrigation and potable water projects implemented in Lebanon, much remains to be done in the way of sustainable and long-term water management. The MOEW has last year, and for the first time, initiated steps aimed at setting a general policy for the management of Lebanon's water resources and formulated a long-term plan for water and wastewater management, and is carrying out a water master plan for Lebanon. This is an important step towards proper, sustainable and comprehensive water resource management. Meanwhile, there is a need to review, consolidate and update the fragmented and the outdated water codes in Lebanon to allow better and more efficient distribution of water resources and create a legal framework that is suited to the demand for more efficient O&M arrangements. As described previously, there are several organizations responsible for O&M in Lebanon (MOEW, LRA, WAs, RWAs, Local Committees, Municipalities). The newly created WAs are supposed to oversee the planning, the design, the implementation, as well as the O&M of water and wastewater infrastructure, with budgets derived from revenues of public shareholders. The MOEW, is expected to supervise all these WAs in the areas of planning, of formulation of strategies for water monitoring and distribution. Moreover, the ministry is responsible for devising specifications of water development and service levels, establishing supervision regulation, evaluating quality of water services and setting water tariffs and pricing mechanisms. In principle, the RWAs, the Local Water Committees, the Water/Irrigation Boards and the Municipalities are responsible for establishing prices and charges, the O&M as permitted by their financial resources, and collection of fees. Existing Arrangements: The existing O&M arrangements for the irrigation schemes rehabilitated and modernized under the current Irrigation Rehabilitation and Modernization Project are given in the appendix 5. A 1995 MOEW study gives also the O&M arrangement for 45 schemes, as shown in appendix 5. From these two appendixes, it is clear that the Local Committees and farmers' groups are the ones most involved with the O&M of the small and medium irrigation schemes. Of the total schemes, about twenty are operated and maintained by farmers groups. This is a clear indication that introduction of formal Water Users Associations (WUAs), as an efficient and sustainable way for organizing O&M is possible and could be successful. The management of irrigation schemes requires qualified personnel to supervise the conveyance and distribution operations, to supervise the maintenance as well as the rehabilitation works, to provide extension services and training of farmers in order to improve operational efficiency and to collect fees for the O&M services and to keep financial records. In general, maintenance of irrigation systems includes: (i) maintenance of the civil works such as canals, reservoirs, pumping stations, tube wells, operational facilities and infrastructure including project offices and staff housing. The economic life of most civil works of this kind are from 30 to 50 years and the annual maintenance cost of the civil works is normally taken as one percent of the investment costs; and (ii) electromechanical equipment and water control equipment such as outlets and hydrants which will have life spans ranging between 10 to 20 years for moving parts (more than 2,500 hrs operating time per year) for which the annual maintenance will cost about 5 percent of investment cost and, other equipment with life span of 20 to 40 years ( for the 35 small and large equipment respectively) with a maintenance cost ranging between 2 percent and 5 percent respectively and automatic and electrical equipment with life spans of 10 years and annual maintenance costs of 5 percent of investment. It is estimated that over one-half of irrigation schemes in Lebanon do not have adequate O&M, which could impact the future sustainability of these schemes. Most of the small and medium irrigation schemes do not have a formal organization or unit in charge of O&M. The two large schemes, Qasmieh Ras el Ain and South Bekaa I, modernized under the IRMP are managed by LRA. Their O&M, undertaken by LRA staff, are properly executed. WATER TARIFFS AND COST RECOVERY A pricing policy should take into consideration economic efficiency, ability to pay, equity in access to services and distribution. While there is a wide range of laws and regulations, which regulate water use and disposal in Lebanon, there are no references to a policy on cost recovery. Each RWA has its own procedures and arrangements for setting and recovering water charges. Water charges for supply of irrigation water are determined by the Boards of the Authorities and are subject to ratification by MOEW and the MOF. Responsibility for the enforcement of the law falls with the RWAs or Committees. These organizations are only responsible for the assessment and collection of charges within "public" collective schemes. It is useful to distinguish among various types of charges, which make up the pricing regime. Two tariffs are generally used in Lebanon: · Area Charges. These are lump sums periodic charges based on area irrigated (a fixed charge per ha, which depends on the crop grown and whether pumping is used or not; it increases if the farmer wishes to receive water more frequently than his allotment (examples: Qasmiyeh Ras el Ain, Yammouneh, Akkar el Bared, Danniyeh, and Barouk/ Safa Irrigation Schemes). In this case water tariffs are indirectly related to the volume of water consumed by adjusting charges on the basis of crops grown. Most schemes operate under the "area charge" system. · Volumetric Charges. This type is used in case of pressurized networks, where the hydrants are equipped by with water counters and usually parcels have direct access to an outlet. This tariff is appropriate for schemes using sprinkling, drip or others modern methods of irrigation (example, South Bekaa Irrigation Project Phase 1 -- 2000 ha). A variation of this system is based on an hourly charge for water delivery (i.e. number of hours multiplied by the discharge). The law authorizes public institutions to collect fees and levy charges for the facilities they operate and the services they provide. In principle, the Regional Water Authorities and the Local Water Committees are responsible for establishing prices and charges, to achieve a balanced budget, consistent with recovering anticipated operations and maintenance costs and in some cases proportion of systems rehabilitation and development costs. O&M Costs. Amongst these are the personnel costs. These include staff salaries and overtime, bonuses, family allowances, transportation allocations and social costs paid to the National Social Security Fund (if any). Other costs include: (i) depreciation cost of infrastructure facilities occupied for O&M of the schemes; (ii) vehicle and equipment O&M expenses; (iv) general expenses (including electricity, water, heating and air conditioning, telephone bills and office upkeep and cleaning). In addition, other annual costs include: (i) extension services and assistance to farmers; (ii) overheads i.e. organization and project management; (iii) energy costs, which might include for example cost of main pumping from wells or surface reservoirs in addition to booster pumps to provide the necessary working heads in pressurized piped irrigation systems; and (iv) irrigation systems canals maintenance. 36 Existing Irrigation Schemes Tariffs. A 1994 MOEW study gives the tariffs applied in the 45 schemes (Appendix 5). Despite the diversity of these schemes, four main categories were observed: a. Tariffs fixed by the LRA (Qasmiyeh scheme), or by the RWA such as Jbeil Water Authority (2 schemes), Barouk Water Authority (two schemes), Qoubayat scheme, Bekaa WA (two schemes). This is the case of eight schemes of a total of 45 schemes reviewed. The tariff range from LL250,000/ha/year for gravity irrigation to LL425,000/ha/year for pumped irrigation (or US$154 to US$253/ha/year in 1994 exchange rate). b. Tariffs range from LL50,000/ha to LL150,000/ha, (US$30 to 90/ha/year). This is the case of 10 to 12 small schemes. c. Tariffs are fixed by the number of irrigations (LL5000/irrigation/ha or US$3.2/irrigation/ha). This case is rare, and has only occurred in the Machghara scheme. d. No tariffs at all, but farmers sometimes pay in emergency situations. The LRA tariffs for Qasmiyeh Ras el Ain Project and the proposed ones for South Bekaa I range between US$300 and 400/ha/year. This is justified by the high water use and ability to pay in the coastal area of Qasmiyeh and by the pressurized system of South Bekaa I. The status of irrigation schemes is strongly correlated with the availability of funds for O&M. The schemes that charge adequate tariffs are well maintained and managed. In case of no tariffs (category iv above), the MOEW used to pay appointed local water committees some subsidies to partially cover any shortfall in O&M costs, and also to rehabilitate those schemes, according to budget availability and political pressure. In 2003, the MOEW stopped paying subsidies to Local Water Committees, which are obliged now to collect fees from farmers for maintenance and water guards. It is to be noted that apart from the schemes which manage to collect adequate O&M fees (such as those which falls under category I and those under the LRA), a number of other small and medium schemes are well maintained (for example: Minnieh, Bcharré, Barouk, Safa and Aanjar Chamssin schemes). The last example being for a schemes well maintained by farmers' group. However as already said, almost 50 percent of the schemes suffer from lack of proper maintenance and unless appropriate and sustainable solutions are found and applied, further deterioration of the schemes would be unavoidable. MOEW's Irrigation Tariffs Study. The MOEW study mentioned above, developed a mathematical model, using a large number of variables, such as: size of the scheme (equipped and irrigated area), winter and summer irrigation, cropping intensity, length and nature of networks and density of canals in the scheme, and finally the ability of farmers to pay, in order to define the level of tariffs needed to achieve O&M cost recovery. Despite the diverse conditions of schemes, two main categories/zones were distinguished: the Coastal Plains and the Interior Zone (Mountainous Zone, South & North Bekaa Zones). The final and simplified recommendations of the study in terms of tariffs were as follows: · Coastal Plains: LL370,000/ha (equivalent to US$220/ha in 1994 exchange rate) · Interior Zone: LL270,000/ha (equivalent to US$161/ha in 1994 exchange rate). These tariffs were based on 1995 prices and if calculated for the current year, they would almost be in line with those currently applied by the LRA for the two large schemes of Qasmiyeh Ras El Ain and South Bekaa I. Although these tariffs were never implemented and the exercise remained theoretical, nevertheless it gave a good indication of the optimal tariff levels. Any tariff should take into consideration the socio-economic conditions, the water availability, the method of irrigation, the cropping intensity, etc. and should of course take into account the beneficiaries views and wishes. Each scheme tariff should be considered separately by the organization responsible for its O&M taking into consideration the above conditions. However, a minimum fee should be fixed in 37 order to cover, at least, the water guards' salaries and the small repair. The application of any proposed higher water tariffs should be gradual over a period of four to five years. The creation of sound and well trained WUAs should very much help in the organizing water charges collection and would certainly help reducing these relatively high charges by introducing direct farmers involvement in the O&M activities either by labor or by material contribution. O&M costs vary among the various schemes, and have to be estimated for each scheme. To determine the appropriate levels of tariff, a separate study is needed to estimate the O&M costs of the various schemes. Such a study could be undertaken either separately, or within the framework of a Public Expenditure Review (PER) of Lebanon. Due to lack of data on actual O&M costs and collection rates, it was not possible to estimate the financial and fiscal gap involved. The main financial issues related to the sector are as follows: (i) insufficient allocation of funds by government for the proper maintenance and rehabilitation of the main irrigation water supply and distribution systems; (ii) in many areas, lack of a uniform and rational methodology for setting and revising water tariffs periodically; (iii) low water tariffs that threaten the long-term sustainability of irrigation schemes, which do not encourage more efficient water use; (iv) low collection of water tariffs in most small and some medium schemes; (v) lack of up-to-date list of subscribers in some WAs; and (vi) lack of accurate accounts and records for calculating the costs of production and O&M of potable water and irrigation water. Any shortfall by the local water authorities or local water committees was until recently covered either by the MOEW, the municipality, or both. Sustainability Outlook. The outlook for physical sustainability of Lebanon's irrigation network is promising. Schemes operated by LRA achieve full cost recovery. Many small schemes, which are operated by local water committees already finance part of O&M costs, and now have to finance the subsidy provided by MOEW. In other schemes, O&M charges and collections need to cover O&M costs, in line with recommendations given in this Note. RECOMMENDATIONS The need for a proper management of scarce water resources and the associated infrastructure are widely recognized in Lebanon. To this end, the following are some recommendations: a. Water should be viewed as an economic commodity and not as a public good. Establishing an appropriate pricing structure will allow full cost recovery of O&M costs as well as part of the initial investments, if required. b. Any proposed water tariff should take into account, amongst others, the social and financial conditions, the water availability and the intensity of production. It should also be easy to apply and administer. Volumetric water charges are easiest to apply in pressurized irrigation networks (but can also be used for gravity irrigation). A two-tier system could be applied: a fixed part for overhead expenses and a variable part based on water volume to improve efficiency. Fees should be raised and periodically adjusted to cover all the O&M costs. c. Institutional strengthening and administrative reforms of water management agencies through reduced government involvement and bureaucratic control should be pursued (see para 6.3.9). d. It is imperative at this stage, to start as soon as possible with the creation of formal WUAs, not only on a pilot basis, but also on a larger scale (if possible) in all the Mohafazats (covering both MOEW and LRA projects). This will necessitate concerted and sustained efforts from all interested parties. WUAs should eventually replace the different organizations currently in charge. 38 e. The creation of the formal WAUs will necessitate a legal framework, which does not yet exist in Lebanon. To prepare the legal framework would need not less than 6-12 months of work by number of different experts not only legal but technical, financial, social, etc. A framework, where the roles and responsibilities with respect to water management (including quality management) of the WUAs and other partners, would need to be prepared in close cooperation with the intended beneficiaries and other interested groups. It is the WAs, with the help of the MOEW, that should provide the legislative framework for the WUAs. They should try to convert many of the Local Water Committees to formal WUAs. The WUA's should be elected bodies for fixed term and should be accountable to the farmers who elected them. f. As indicated earlier, the newly created WAs are in favor of this approach and would support the establishment of the WUAs as this will reduce their workload and financial burden. However, the WAs should remain in charge of the O&M of larger main canals, intake structures and pumping stations which are sometimes well above the farmers' capacities. g. MOEW should continue to assist the WAs and regional and local committees in the O&M of the schemes especially those which are in bad state of repair. However, this assistance should be limited in time (5 years maximum), as well as in scope, waiting for the WAs to properly organize themselves. Large civil works would remain the MOEW responsibility. h. For schemes to be managed by WUAs, it will be up to the members to set the tariffs. But it should be made clear to them that if they do not collect enough funds for maintenance, then the WUAs could take over the O&M activities while charging the proper fees. i. In irrigation schemes where farmers have access to both surface and groundwater (South Bekaa), water tariffs should be set lower than or equal to the private cost of pumping groundwater in areas that benefit from both sources of irrigation water, for fear that farmers would only use groundwater. j. Members of the WUAs should determine what level of service they need their WUA to provide and they should pay for. Members of the WUAs should be responsible for the O&M of their schemes, for the collection of water fees, (and imposing sanctions if needed) and for the payment of fees to the authority responsible for providing the bulk water and any other services. k. Each WUA should keep accurate and transparent accounts to keep track of the various services provided. These accounts should be made available to the members and to the WAs. l. Any rehabilitation or improvement irrigation projects to be carried out using external funds should introduce the concept of formal WUAs as an institutional strengthening component. Design and supervision of the works should be carried out in close cooperation with, and with the full agreement of, the WUAs. m. Necessary and well-focused training related to the establishment and management of WUAs should be provided to all involved parties. Training of the WUAs members, as well as the personnel of the WAs and MOEW, on aspects such as participatory approach, management, accounting will be necessary. Donors, NGOs, or any other specialized parties can provide training. 39 8. Financial and Economic Aspects Policy impact on irrigated agriculture. Economic policy impacts agriculture in several ways: (i) water tariffs for irrigation schemes; (ii) macro-economic policy through exchange rate and interest rate policies; (iii) agricultural subsidies on exports and credit; and; (iv) trade policy and trade agreements. Water tariffs and cost recovery. Water laws or regulations do not govern water tariffs, and there are no provisions for recovery of irrigation investment costs in irrigation schemes, and private irrigation schemes do not pay any water tariffs. Water tariffs in the main irrigation schemes are far below the marginal cost of water, estimated in 1999 by the United Nations' Economic and Social Commission for West Asia (ESCWA) to be in the range of $0.20-0.25/m3, comparable to marginal costs in the West Bank (ESCWA 1999). Although this may be a conservative estimate, it is nevertheless far above water tariffs in most of the irrigation schemes, and charges are mostly based on irrigated area rather than water volume, and hence do not provide an incentive to improve efficiency of water use.Low water tariffs and low collection rates threaten the sustainability of irrigation systems, do not provide an incentive for conservation of irrigation water, and increase the fiscal burden. Macroeconomic policy. This policy impacts agriculture mainly through both the exchange rate and interest rate levels. By most accounts, the Lebanese currency is overvalued, and has unofficially been pegged to the United States dollar. It is estimated that the real effective exchange rate of the Lebanese currency appreciated by 58 percent between 1993 and 1998 (World Bank, Social Protection Note). This appreciation vis-à-vis currencies of Lebanon's trading partners in the Gulf region and in the European Union countries has an adverse impact on the export sectors, namely, manufactures, agriculture, tourism, and services, although it has a positive impact on the prices of imports, which make up a sizable portion of domestic consumption. The over-valued exchange rate was maintained through a high interest rate on the Lebanese currency, which discourages productivity-increasing capital investment that carries embodied technological improvements. The exchange rate has recently depreciated as a consequence of a falling United States dollar vis-à-vis the major European currencies, which should encourage exports, but its magnitude is not known due to the lack of empirical data on the elasticity of agricultural exports to the exchange rate. Kafalat corporation. To improve access to commercial bank lending of small and medium enterprises in agriculture and other sectors, Kafalat Corporation, a joint venture between the National Deposit Guarantee Corporation (75 percent) and commercial banks (25 percent), provides government guarantee for 75 percent of loans provided by commercial banks for new investments and for working capital for enterprises in agriculture, industry, tourism, information technology, and handicrafts. The loan ceiling is $200,000 and the borrowing rate is around 3.5 percent. Of the 715 loan guarantees issued by Kafalat through December 2001, 45 percent were in agriculture, and 39 percent were in industry; as of that date, the total loan portfolio was LL63 billion ($42 million). Investment Development Authority of Lebanon (IDAL). This agency was established in 2001 as an autonomous agency to promote private investment, particularly in the less-developed regions of Lebanon through tax holidays of up to ten years, and providing support to private investors (by serving as a one- stop agency for issuing investment permits, licenses, and work permits to employees, carrying out pre- feasibility studies to attract potential investors, etc). In addition, IDAL launched the Export-Plus program to promote the export of agricultural products. The export subsidy depends on the kind of product and 41 mode of transportation, and is based on weight rather than value and hence is mainly a transportation subsidy; hence it does not promote the production of high value-added crops. The export subsidy allocation for 2001 was US$33 million. The major export markets are the Gulf countries, particularly Saudi Arabia and Kuwait. Three international firms supervise quality control. As a condition for accession to the WTO, Lebanon should eliminate exports subsidies, which threatens the sustainability of this program. COMPETITIVENESS AND SUSTAINABILITY OF IRRIGATED AGRICULTURE Irrigated agriculture in Lebanon supports a wide variety of crops, particularly fruits and vegetables grown in the field and in greenhouses, which are the main export crops. There has been a shift towards intensification of production of fruits, vegetables, and industrial crops, at the expense of cereals and pulses. This shift has been largely due to a rise in irrigated area, increased production in green houses that have higher productivity and produce off-season crops, and producer subsidies for industrial crops. A 1999 ESCWA study concluded that in terms of efficiency indicators, Domestic Resource Cost, Nominal Protection Coefficient, and Effective Protection Coefficient (DRC, NPC, and EPC), "there are a number of agricultural products where Lebanon has a comparative advantage" (ESCWA 1999 and World Bank 2003a). In this context, Lebanon has a comparative advantage in high value horticultural crops, but is not competitive in field crops. Competitiveness is enhanced by the diversity of its climatic zones, proximity to the Gulf and European markets, and advantageous terms negotiated in the EU Association Agreement. Nevertheless, Lebanon faces strong competition in vegetables and fruits from neighboring countries. Hence improving competitiveness is key to the future of agriculture in Lebanon. Lebanese agriculture has a high cost structure for several reasons: the mountainous nature of many agricultural lands that produce fruits and some vegetables; a limited domestic market and small and fragmented holdings that do not allow for economies of scale; a high proportion of hired labor (around 30 percent, mostly foreign labor); wasteful irrigation practices such as furrow irrigation in many areas; low conveyance, distribution, and on-farm irrigation efficiency; and high usage of fertilizers and pesticides that are encouraged by input suppliers.7 This is partially offset by high yields that are comparable to Egypt and Turkey. The domestic market is limited and is very competitive, and the export market has a good potential, while a large part of Lebanese agricultural exports consists of traditional crops, such as tomatoes, cucumbers and potatoes. Competition will become more intense as regional and international trade agreements come into effect. Recommendations. Lebanon is or can be competitive in high value added crops (fresh fruits and vegetables) geared mainly for the export market, but this potential is not fully exploited at the present. To exploit this potential, the main options for improving competitiveness lie in reducing the cost structure, improving irrigation efficiency, producing higher value added and organic crops of high quality that meet the standards of the European and other markets, export market development, and improving the efficiency of domestic markets. Establishing a regulatory environment that enhances the role of farmer organizations and cooperatives to improve quality, efficiency, competitive price formation, and reduce market risks, would help. 7At first glance, this implies that using cheaper foreign labor would reduce costs. However, it is reported that agricultural wages for foreign labor in Lebanon, mainly Syrians, are around US$ 10/day; agricultural wages I n Syria are around US$ 3-4/day, which contributes to higher relative production costs in Lebanon. 42 Costs can be reduced through the following measures: (i) increasing cropping intensity of irrigated areas and improving yields. The present cropping intensity does not exceed 130 percent on average in areas irrigated by wells, but this can be raised to higher levels; (ii) technology transfer for using less fertilizers and pesticides and increasing yields (FAO Investment Centre 2000a);8 (iii) more efficient irrigation techniques and increased mechanization where feasible; and (iv) in the longer term, a concerted effort is needed to mitigate the structural impediments in agriculture: voluntary land consolidation through the legal system, and analysis of the land tenure system. In the area of macroeconomic policy, government commitment to a stable exchange rate vis-à-vis the US dollar is strong, at least in the short term. Over the medium and long term, the adoption of a more flexible exchange rate regime, in addition to phasing out of subsidies, need to be seriously considered. The pros of a more flexible exchange rate that encourage exports, have to be weighed against the cons of raising import prices and its impact on fixed income groups in Lebanese currency, and social considerations, all within the framework of GOL's overall macroeconomic policy, and the ability of the central bank to maintain a relatively stable exchange rate. The competitiveness of Lebanese agricultural and food exports has recently witnessed a boost as the Lebanese currency has depreciated considerably in tandem with the US dollar, but its magnitude is not known due to the lack of empirical estimates of the elasticity of agricultural exports to the exchange rate. Moreover, interest rates have fallen following the Paris II donors' meeting in late 2002. Lebanese exporters should be able to exploit this opportunity to expand exports. Overall, irrigated agriculture is deemed to be sustainable in the long term for the following reasons: a. agriculture in Lebanon does not provide the only, or in many cases even the major, source of livelihood for households, but rather supplements family income. Hence even though agriculture contributes only about 6-7 percent of GDP, it will continue to survive, and the challenge is to make it more competitive and efficient.9 b. the EU Partnership Agreement provides a unique opportunity and potential market for high value horticultural produce, provided Lebanon complies with health and quality standards. As mentioned earlier, the Agreement provides technical assistance for harmonization of health and quality standards between Lebanon and the EU; c. Lebanon can expand the export of processed food and specialty products, in which it is competitive, and also expand the domestic market; and d. irrigated agriculture contributes to poverty alleviation in some of the poorest Cazas in Lebanon where new irrigation schemes are proposed, such as Baalbeck (Al Assi); Akkar/Minnieh/Danniyeh (Noura Al Tahla and El Bared); South Lebanon (Conveyor 800 m); and South Bakaa. To enhance the sustainability of agriculture, complimentary initiatives are needed to improve competitiveness, and export market development (GOL is in the process of establishing an Export Development Agency). In addition, more effective extension and research functions, and domestic market improvement are required to make agriculture more efficient and competitive. A bright area for Lebanon is high quality processed food products, where Lebanon is competitive, as evidenced by exports to Arab countries, the United States, and some European countries. It can be 8It is estimated that the cost of fertilizers and pesticides can be reduced by 20-30 percent, and yields may be increased by about 25 percent. 9For further analysis, refer to the report Lebanon, Perspectives on Agriculture Sector Issues, being finalized by MNSRE. 43 concluded that Lebanon possesses the potential to be competitive in high value added crops and processed food products, geared mainly for the export markets. AGRICULTURAL M ARKETING In Lebanon, marketing agricultural produce, particularly fresh fruits and vegetables, faces several challenges. First is the inadequate marketing infrastructure (wholesale markets, cold storage and packing facilities suffered damage during the civil war) and poor access roads in certain areas. Second is the lack of official grades and standards and of labeling standards. Third, are the inefficiencies and high margins in the wholesale markets.10 Fourth, high post-harvest losses are estimated to exceed 30 percent and lead to a deterioration of quality. Fifth, is the lack of accredited laboratories for certification of pesticide levels in fruits and vegetables for export. Finally, there is the lack of an efficient market information system, both for access and dissemination. Furthermore, Lebanese producers have not kept pace with changes in consumer demand and they still produce aging fruit varieties; golden and red delicious apples are the staple of the apple industry in Lebanon, while consumer demand in Europe has shifted towards other varieties such as Granny Smith, Gala, etc. A main shortcoming of the agricultural marketing system is the lack of market data on demand, supply, and prices in the export markets, quality and health standards, tariffs, quotas, and permits. Recommendations. Despite these challenges, Lebanese fresh produce has many advantages. Lebanon produces a wide variety of high quality fresh produce and their derivatives, such as apples produced at high elevations, cherries, fruit juices, wines, etc. By focusing on select products for export, Lebanese exporters can develop credible branded products. Lebanon has a good potential for organic farming; already some crops are being produced under organic farming conditions, such as almonds, figs, and some grapes, and cherries, which have found a niche in the domestic market. Organic farming has a good export potential in Europe and the budding industry in Lebanon needs to be nurtured and developed by entrepreneurs to take advantage of export opportunities. Certification of organic products by a credible agency is essential to penetrate export markets. AGRICULTURAL SERVICES : RESEARCH, EXTENSION AND CREDIT Agricultural research Agricultural services in Lebanon are weak. The research programs of the Agricultural Research of Lebanon (ARIL) cover a wide variety of themes: irrigation water efficiency, plant protection, tissue culture, integrated pest management (IPM), and others. ARIL is completing the rehabilitation of its research facilities, financed under the IRMP, following the civil war. Issues. ARIL is challenged by its focus on traditional crops and its lack of a farming systems approach. In fact it lacks technical packages for non-traditional crops that have the best export potential;. ARIL also has insufficient qualified technical staff and equipment, including irrigation equipment. Finally, has inadequate administrative and financial autonomy. Recommendations. Lebanon needs to develop a national export-oriented research strategy that addresses farmers' needs where the country is or can become competitive, including non-traditional niche crops, such as certified seeds. The farming systems approach to research should be adopted. An ad-hoc panel 10It is reported that wholesale markets are characterized by market imperfections and monopolistic features (CDR, 2002) 44 should be established to periodically evaluate ARIL's research strategy, priorities, and programs. Finally, the government should grant more autonomy to ARIL. Extension Issues. Extension and technology transfer programs by the public sector are practically non-existent. Farmers receive advice mostly from input suppliers who may recommend excessive use of fertilizers and pesticides. Extension to improve irrigation use efficiency is lacking, along with proper advice on plant protection, new production practices, and new varieties of apples and other fruits. There is no link between extension and research programs of ARIL, and hence some research programs are not demand- driven. Recommendations. The Bank recommends a limited but more effective role for the extension service, where the public extension service would provide an overall strategic framework and enabling environment for private sector operation, and assume a supervisory role such as monitoring private sector advice to farmers to avoid excessive use of inputs. Cooperation between the private and public sectors should be nurtured, making full use of universities, international organizations, and qualified NGOs. Core specialists in the major fields should be retained on a regional basis to serve as resource persons for field extension workers. The linkage between extension and research activities should be strengthened based on a participatory needs assessment, so that research programs would be more demand-driven. Applied research should be strengthened to provide extension services with needed advice and to train farmers' leaders. Finally, cost-effective dissemination of technical packages should be promoted through mass media and other channels. To ensure the sustainability of sources of finance for agricultural and rural credit in the future, it is envisaged that the newly established ESFD, which has responsibility for development of small and micro enterprises, would mobilize funds for agricultural and rural development, including credit for small and medium enterprises. AGRICULT URAL TRADE AND TRADE AGREEMENTS In 1998, Saudi Arabia imported 42 percent of Lebanese exports of fruits and vegetables, and Kuwait accounted for 17-20 percent (ESCWA 1999). Over one third of Lebanese agricultural exports were destined for Gulf Cooperation Council (GCC) member states in 1999 (table 8.1). Over the medium and long term, the adoption of a macroeconomic policy that allows a more flexible exchange rate needs to be explored, within GOL's overall macroeconomic policy. The recent slide in the value of the US dollar has helped the competitiveness of Lebanese exports to the European Union, and exporters should be able to take advantage of this opportunity. Table 8.1 Imports and exports of agricultural products (LL Billion), 1999-2001 Imports Exports Category 1999 2000 2001 1999 2000 2001 Plant Products 564.9 533.3 588.8 118.2 106.9 135.8 Animal Products 541.3 519.3 555.4 2.9 1.9 3.2 Total 1106.2 1052.6 1144.2 121.1 108.8 139.0 Source: MOA, Agriculture in Lebanon, 2000-2001, May 2002 (Arabic). 45 9. The Public Investment Program in Irrigated Agriculture Public investment in the irrigation sector in Lebanon has so far been carried out by two agencies, MOEW and LRA. Once they become fully operational, the newly established WAs will have responsibility for executing potable water projects and small projects in irrigation, but the design and implementation of dams and major projects remain under the jurisdiction of MOEW. Based on its mandate, LRA will retain responsibility for irrigation projects in areas where it is currently operating in the South Bekaa and South Lebanon, and for countrywide monitoring of water resources. This section will briefly discuss the investment programs of MOEW and LRA MOEW INVESTMENT PROGRAM Following implementation of the IRMP (Ln. 3769 LE) for the rehabilitation and modernization of about 25,000 ha of irrigation networks, the focus of MOEW shifted to the construction of dams and some hill lakes to harness part of the 0.7 BCM of runoff rain water that is currently lost annually to the sea, and which is urgently needed, particularly in the dry summer months, when Lebanon already faces a shortage. MOEW's irrigation investment program through 2030 carries a total cost of nearly US$530 million, of which US$320 million goes for the construction of dams and hill lakes, and US$210 million for construction or modernization of distribution networks for the proposed dams, or for existing irrigated areas. (see table 10.1) Only one dam in Lebanon, Chabrouh (at a cost US$50 million), is under execution with government funding, which will provide around eight MCM for potable water only, and a contract has been signed for the Yammouneh lake scheme (cost $6 million). In addition to providing irrigation water to about 12,150 ha, MOEW's investment program includes the rehabilitation or modernization of another 11,000 ha. Lebanon and Syria have reached agreement on sharing the waters of the Al-Assi River, which originates in Lebanon, and flows into Syria. The Al-Assi scheme is a joint undertaking between Lebanon and Syria for irrigation, potable water, and power generation. The project will be implemented in two phases. The first phase (diversion dam, three pumping stations, and network for irrigation of about 3,000 ha), will be tendered in 2003/2004. Bidding on the main phase (construction of a 37 MCM dam--Lebanon's share -- and three pumping stations, irrigation network for 3,600 ha, and the hydro-power plant) is planned for 2004. The Noura Al Tahta dam scheme is also a joint project with Syria on El Kabir River, to allow the storage of 70 MCM (about 35 MCM for Lebanon), mainly for irrigation (90 percent); it will also provide water for domestic purposes. The El Bared dam and reservoir project, with a storage capacity of 40 MCM, will provide about 20 percent of the water for domestic uses in Tripoli and surrounding areas, and about 80 percent for irrigation. The Iaal dam and reservoir project allows the diversion of water from Abu Ali River to fill a ten MCM reservoir for potable water for Zghorta and surrounding areas, and will provide excess water for irrigation. The Younine dam and lake in Baalbek caza will provide storage of seven MCM: for irrigation (80 percent) and for potable water (20 percent). 47 Table 10.1 MOEW's investment program, 2003-2030 Capacity MCM Gross irrigated area (ha) Cost US$ Million Percent Dams, Distrib. Project Location Total irrigated Total New Rehab. Lakes network Total Phase I, 2002-2015 Noura Al Tahta Akkar 35* 90 10,000 2,000 8,000 26.5* 40 66.5 Dam Al Assi Dam Baalbeck 37* 90 6,600 6,600 0 122.5 130 252.5 Project El Bared Dam & Akkar/ 40 80 3,000 0 3,000 46.5 0 46.5 Reservoir Minieh Hill Lakes 10 1,250 1,250 0 50 Included 50 (10 no) Phase II, 2016-2030 Iaal Dam & Zghorta 10 10 1,300 1,300 0 46.5 20 66.5 Reservoir Younine Dam/ Baalbeck 7 80 1,000 1,000 0 21 20 41 Lake Yammouneh Baalbeck 1.5 100 6.3 0** 6.3 Lake*** Total 140.5 23,150 12,150 11,000 319.3 210 529.3 *Jointly with Syria; figure represents Lebanon's share. ** Distribution cost by beneficiaries. ***Night storage, no new irrigated area. ****Excluding Yammouneh Lake Source: MOEW Several projects in MOEW's irrigation investment program are either at the project identification stage or the preliminary study phase. This includes the Noura Al Tahta, El Bared, Iaal, and Younine schemes, and all the other small and medium schemes. No feasibility studies have been carried out for these schemes. Furthermore, foreign funding has not been secured. Preliminary analysis shows that Noura El-Tahta could be economically feasible for irrigation purposes, and that El-Bared scheme, which has a higher cost but can be used for both potable water supply and irrigation, might also be justified. It should be noted that these are just first rough estimates based on cost of storage/m3, which ranges between US$0.41/m3 and US$9.8/m3 It is imperative to carry out feasibility studies to determine the technical and economic/financial feasibility of each of the proposed dams and hill lakes. LRA INVESTMENT PROGRAM LRA investment program (table 10.2) through 2030 costs US$817 and includes the following main projects: (i) Canal 800m Conveyor Phases I and II; (ii) Annan-Nabatiyeh Conveyor; (iii) the South Bekaa Phase II; (iv) Khardaleh dam; and (v) the left bank of the Litani river and north zone schemes, in addition to other smaller projects. The center-piece of LRA's investment program is the Canal 800m Conveyor Project, Phases I and II, at a total cost of US$460 million, which would serve areas between elevations 800m and 400m in South Lebanon. This is a multi-use project that would provide 90 MCM to irrigate a net new area of 13,230 ha 48 Table 10.2 LRA's investment program, 2003-2020 Net New Irrigated Additional Rehabilitation Cost $ Scheme/Project Purpose Area (ha) Area (ha) Area (ha) Million* Status South Lebanon I & PW 0 0 0 217 Financed by 800m Conveyor Arab Fund, Phase I Kuwait Fund South Lebanon I &PW 13,230 13,230 243 Preliminary 800m Conveyor (Phase studies Phase II I&II) Annan-Nabatiyeh I & PW 4,700 4,700 0 105 Preliminary Conveyor studies South Bekaa II Left I 6,700 0 6,700 45 Feasibility study Bank being updated South Qaraoun I 800 800 0 5 Feas. Study Reservoir Scheme prepared Qasmieh Ras El Ain I 2,100 2,100 0 15 Storage capacity Phase II** 10-12 MCM Kfarsir Khardale Dam I 9,000 9,000 0 150 Storage capacity Project 128 MCM Right Bank of I 12,800 0 12,800 25.6 Litani, North Zone Saida Jezzine I 1,200 1,200 0 5.8 Hydrometric Data I 3 Monitoring Qaraoun Reservoir I 1 Pollution Control Agr. Exp Station 2 Total 50,530 31,030 19,500 817.4 I= Irrigation PW=Potable Water. * Includes distribution network. ** Including Kfarsir dam. Source: LRA from the Qaraoun dam by gravity, in addition to providing 20 MCM of potable water annually when Phase II is completed, for over 500,000 inhabitants in nearly 100 villages. It is to be noted that the Qaraoun Dam reservoir has adequate storage capacity to supply water for 20,000 ha of the proposed 50,000 ha proposed by the GOL. Phase I, with a cost of US$217 million, is financed by the Arab Fund for Economic and Social Development (AFESD) and the Kuwait Fund for Arab Economic Development (KFAED), which together finance US$165 million, while government finances US$52 million. LRA officials informed the Bank that preliminary discussions indicate that the same donors may finance Phase II of the project. On a prorated basis, the cost of irrigation water would be around US$376 million, or US$28,000/ha.11 This cost is extremely high and the main justifications may be the production of very 11Total cost of $460 million is prorated on the basis of 90 MCM for irrigation and 20 MCM for potable water supply. However, since potable water would have first priority in dry years, it can be argued that its share in project cost should be higher. 49 high-value added cash crops, water use for municipal and industrial purposes for 500,000 inhabitants, and social benefits by encouraging residents who left the region during the Israeli occupation to go back to their villages. The Annan-Nabatiyeh Conveyor Project would convey Qaraoun dam water for irrigation and potable water by gravity from Annan basin through an open canal and pipes to areas in Zahrani and Nabatiyeh. It would irrigate a new area of 4,700 ha and provide potable water for 46 villages. A preliminary study has been carried out, but the breakdown of the $105 million cost between irrigation and potable water is not available. A feasibility study is needed to determine if the project could be justified on the basis of providing potable water in addition to irrigation water. The updated feasibility study for the South Bekaa Irrigation Scheme Phase II Project (Left Bank) carried out in 2002 showed that the project is viable. Phase I, funded by the Bank and government, has already been completed, and provides irrigation for 2,000 ha, in addition to investments in the major infrastructure which will provide water for Phase II (dam, pumping station, pipeline, 14.5 km main canal, etc.). Phase II would improve irrigation in an area of 6,700 ha on the left bank of the Litani river, from the Qaraoun dam, to bring the total area irrigated by the project to 8,700 ha. About 75 percent of the costs of the pumping station and Canal 900m have already been implemented during the seventies, and Phase II would build on this sunk cost and is expected to be viable. "The rationale for the South Bekaa Project development was mainly to ensure water availability and reliability during the dry season, and to introduce a more efficient and controlled irrigation system" (FAO 2000a). The project would allow the transition from mainly private pumping of groundwater for irrigation water, where owners have acquired water rights, to a more efficient system of collective and controlled pressurized irrigation system. It would thereby replace the uncontrolled pumping of groundwater that threatens the sustainability of groundwater sources, and encourage farmers to participate in the scheme, on a voluntary basis through water tariffs, which are lower than pumping costs, in covering the O&M costs of the scheme. The South Qaraoun Irrigation Scheme would irrigate 800 ha, at a cost of US$5 million. A feasibility study is being carried out, but the results are not yet available. The Qasmieh Irrigation Scheme Phase II (including construction of Kfarsir dam) would increase the irrigated area by 2,100 ha at elevations 100- 200m above sea level. Equipment for Hydrometric Data Monitoring is urgently needed since little hydrometric data was collected since the beginning of the civil war. This project would supplement equipment procured under the IRMP (Ln. 3769 LE), and would enhance the national database for policy and planning objectives. The Qaraoun Reservoir Pollution Control Scheme, with the assistance of Sweden, aims to reduce the serious pollution of the reservoir, which is threatened by solid and liquid wastes, heavy metal pollution, and micro-organisms. The strategy is to improve water management through increased monitoring and establishing an institutional arrangement to disseminate timely data to the public and private sectors. This scheme, which costs US$1 million, is a vital step for pollution control of the Qaraoun dam water. LRA has one Agricultural and Animal Experiment Station at Lebaa to carry out trials and research on new varieties and cropping patterns suitable for South Lebanon, and on new irrigation techniques. It also has a training center for farmers and vocational students. LRA plans to upgrade these facilities and to establish another research station in the Bekaa in collaboration with ARIL, at a cost of US$2 million. Although research is mainly the responsibility of ARIL, the dearth of research activity in the South warrants this activity. Lebanon's irrigation investment program is summarized in table 10.3 below, which combines MOEW's and LRA's programs. The total cost of the public irrigation investment program is US$1,346 million. MOEW's share, or nearly US$530 million, over 28 years, translates into an annual expenditure of US$19 million. LRA's investment program of $817 million envisages annual expenditures of US$29 million. However, this 50 program is front-ended; consequently, expenditures during the early period are higher than the average as a result of implementation of the Conveyor 800 and the Al-Assi projects, and could exceed the annual average considerably. Table 10.3 Summary of Lebanon's current irrigation investment program, 2002-2030 Average Annual Capacity Total Irrig. New Irrig. Irrig. Rehab. Cost Investment Category MCM Area Ha Area Ha Area Ha US$ Million $ Million MOEW 140.5 23,150 12,150 11,000 529 19.0 LRA 140 50,530 31,030 19,500 817 29.0 Total 280.5 73,680 43,180 30,500 1,346 48.0 NGOs, Priv. - - 6,820* - Na Na * Could be using treated sewage effluent. Currently, the irrigation investment programs of both MOEW and LRA do not provide for stakeholder participation in the identification, design, implementation, or management of O&M functions in irrigation projects. This irrigation investment program is quite optimistic and ambitious, especially for LRA, considering past experience. To achieve the program requires quick mobilization of human resources that are needed for timely implementation, a high level of institutional capacity of the implementing agencies, a strengthening of the newly established Water Authorities, strong farmer participation through the formation of Water User Associations, the presence of effective support services in agricultural research and extension, a fast pace of mobilizing donor financing and availability of counterpart funding that have a critical impact on achieving these targets. In view of these constraints, the current size of the public debt, and the need to develop export markets to absorb the incremental agricultural production, Lebanon's irrigation investment program represents a high-end scenario. A medium or low-end scenario that involves expenditures that do not exceed US$35 million per year is more realistic and is proposed. If government accepts this scenario, MOEW and LRA need to prioritize their investment programs. This could include, but not necessarily be limited to, exclusion or delay execution of expensive hill lakes unless they are urgently needed for municipal purposes, and the postponement of the Khardaleh dam and the Annan-Nabatiyeh Conveyor. This would reduce the new irrigated area to 36,300 ha, instead of the proposed 50,000 ha, and the total irrigated area to around 126, 300 ha instead of 140,000 ha by 2030. In addition to the above investment programs, treated sewage effluent could be used to irrigate about 3,000-5,000 ha. NGO's and the private sector should be allowed to use this water for irrigation. Increasing the irrigation potential in Lebanon by 30-50 percent in the next 30 years would add a substantial agricultural production in the market, which will need to be absorbed. With the present population growth rate of about two percent annually, a large proportion of this new production would be absorbed by the local market. However, the aim of increasing the irrigation potential is also to produce high-value crops for the international markets. It is believed that some of the increase in production generated by the expansion in the irrigated areas could very well be exported, if proper mechanisms are in place as discussed in previous chapters. 51 RECOMMENDATIONS The Bank recommends that the Government, particularly MOEW and LRA, as well as the newly established WAs, should consider scaling down the investment programs to a more manageable level, particularly by LRA, so that annual expenditures do not exceed US$35 million. This would help avoid a sizable increase in the public debt, which already absorbs over one-half of the annual budget, and it would bring the irrigation investment programs in line with the capacity of the implementing institutions. The Bank also recommends limited the construction of hill lakes to areas that urgently need potable water, as they are too expensive to use for irrigation. MOEW and should prioritize their investment programs based on technical and economic/financial feasibility studies, as well as the social priorities in beneficiary areas. The implementing agencies should involve local stakeholders in O&M functions through Water User Associations to promote ownership and encourage greater financial contributions by beneficiaries. A priority action should be the immediate completion of the legal framework for WAs and upgrading their human resource and financial capacities to enable an orderly transfer of O&M functions to WAs. Finally, the Government should give serious consideration to privatizing the services of the WAs over the long term. This study commends MOEW for giving the highest priority to potable water supply projects, followed by dual-use projects (potable water and irrigation). Moreover, MOEW and LRA are commended for including the rehabilitation of irrigation networks in the investment program, where investments are usually smaller, benefits are realized sooner, and economic and financial returns are viable. It is imperative that implementation of the irrigation investment program should be accompanied by effective water demand management measures for both irrigation schemes and groundwater pumping. An effective mechanism is needed for enforcing existing laws and regulations, or new laws should be enacted when needed, to regulate groundwater abstraction in private schemes; volumetric metering could be introduced in vulnerable basins to reduce water abstraction to more sustainable levels. In public irrigation schemes, it is important to adjust water tariffs periodically and enforce cost recovery in order to ensure their future sustainability. A legitimate concern arises if a large part of the 50,000 ha is brought under irrigation (in addition to rehabilitation of 30,000 ha in existing networks), namely, the ability of the domestic and/or export markets to absorb the incremental production over 30 years. The domestic market is limited, and competition in the domestic and export markets is strong and increasing. Although population growth and demand for higher quality produce associated with rising income would mitigate the effect of a limited market, the main options lie in reducing costs of production (more efficient use of irrigation water, using less fertilizers and pesticides, increasing yields, etc.), and export promotion through the production of higher value added crops of good quality that meet the standards of the European markets. Another good potential is the export of high quality processed food products, where Lebanon is competitive. The export potential of Lebanon has been enhanced by a falling exchange rate in tandem with the US dollar, and exporters should be able to expand exports, particularly to the European Union. A scaled down irrigation investment program, export market development, cost reduction, improved irrigation efficiency, agro-processing of agricultural produce, and a falling exchange rate should enable the economy to accommodate the increased production arising from implementation of the revised irrigation investment program that would bring the total irrigated area to 126,300 ha by 2030, or 1,300 ha per year and the total storage capacity to about 360 MCM and a total storage of about 360 MCM. 52 10. Strategic Choices Facing Irrigated Agriculture Government Strategic Objectives and Priorities. The main objectives of GOL in the irrigation sector derive closely from related objectives for overall water resource management in Lebanon. These objectives, which were identified during extended discussions with officials of MOEW, LARI, and other agencies, can be summarized as follows: (i) ensure the availability and sustainability of water resources for future generations for irrigation, drinking, industry, and tourism; (ii) ensure adequate operation and maintenance of the national irrigation network to guard against degradation of irrigation schemes and avoid expensive early replacement; (iii) strengthen the institutional capacity of agencies in charge of water resource management; (iv) increase stakeholder participation in the management of O&M functions and reduce the fiscal burden, through the establishment of WUAs and providing the legal framework required for their operation; and (v) protect the environment. A strategy to achieve these objectives could follow four parallel tracks to address technical, financial/economic, institutional, and environmental aspects as summarized below: TECHNICAL ASPECTS Lebanon faces a seasonal water shortage and may soon face an overall shortage. For national water resource planning, the ongoing Water Resources Master Plan (WRMP) being prepared by MOEW with JICA assistance, is critical for assessment of the future water demand for all uses, including irrigation, in order to adopt strategies and policies to meet any expected water shortage. Tentative findings indicate that Lebanon will have a water shortage in the dry months of 2004 that could exceed 700 MCM by 2030. Moreover, the annual water balance would go into deficit shortly after 2020, if no additional water storage capacity is built. At the same time, over 700MCM of surface water are lost to the sea annually. In this regard, it is important to improve meteorological and hydrological data needed to arrive at reliable estimates for use by policy makers. Augmenting water storage capacity is essential for sustainability. GOL has an ambitious irrigation investment program to increase water storage capacity to meet future demand from the present 220 MCM to around 500 MCM by 2030. The cost of the program, excluding contingencies, is around US$1,346 million, representing annual expenditures of US$48 million. The investment program is front-ended. About US$217 million have been committed for the 800m Conveyor Project, Phase I, and US$243 million are likely to be committed by the same donors soon. Moreover, bidding for Phase I of the Al-Assi project, jointly undertaken with Syria, is due before the end of 2003, and bidding for Phase II is expected in the summer of 2004 (at a total cost of US$252 million). The irrigation investment program is quite ambitious. These projects are considered high priority for GOL for economic and social considerations. Beyond that, the PN recommends the following actions: (i) scale down the investment program to no more than US$35 million per year to mitigate any increase in the high public debt, and taking into consideration the capacity of implementing agencies; and (ii) prioritize the investment program and postpone the Khardaleh dam and the Annan Nabatieh Conveyor (US$255 million), and expensive hill lakes. These actions, if adopted, would increase the irrigated area by around 36,000 ha over 30 years, increase farm income, and allow a more orderly marketing of incremental production in the new irrigated areas. 53 Treated wastewater could be a valuable resource for agriculture. There is only one large wastewater treatment plant in Lebanon, in addition to around 15 smallscale plants. GOL has a long term plan to build 25 new plants for the major cities, which is being delayed by a tight fiscal situation. It is recommended to develop cost-effective smallscale wastewater treatment plants for rural communities as a priority, and treated wastewater can be used in agriculture. However, this requires a an economic evaluation and regulatory framework, setting health standards for the use of treated wastewater, and public awareness campaigns targeting all stakeholders, to explain the risks and benefits, including the health and environmental impact of using treated wastewater. Training of GOL staff (particularly MOE or MOA) and farmers on using treated wastewater is also necessary. Improving irrigation efficiency saves water and cost. Irrigation efficiency can be improved through incentives for water-saving technologies (duty free imports for drip and sprinkler equipment), technology transfer through effective applied research and extension services to improve on-farm irrigation efficiency, and raising cost recovery in irrigation schemes in addition to rehabilitating and modernization of the irrigation schemes main networks. FINANCIAL AND ECONOMIC ASPECTS Cost recovery and demand management are essential compliment to increasing supply. A critical aspect of water resource management is a more efficient use of water, and ensuring the sustainability of irrigation networks through providing adequate O&M functions. Currently, water charges collected from beneficiaries are not sufficient to provide proper O&M functions in about one half of the irrigation schemes, which threatens their future sustainability. To improve irrigation water demand management and cost recovery, and consequently the sustainability of irrigation schemes, the following measures are recommended: (i) raise irrigation water tariffs to cover as a first step O&M costs, and over the long term cover at least part of the investment costs; (ii) periodically review and adjust water tariffs to reflect actual costs; (iii) base water charges on the volume of water used rather than area, which does not provide an incentive for more efficient water use. Volumetric charges can be introduced in LRA irrigation schemes, starting with the pressurized irrigation system in the South Bekaa Phase I, and in the future in Phase II, and can later be expanded to other schemes. Where metering is not feasible at this time, base water charges on a combination of a fixed charge to cover the basic services, and other charges which can be used as a proxy for the volume of water used, such as crop grown and/or hourly use of water. A combination of these systems is currently used in some schemes in Lebanon; (iv) enforce the existing regulatory framework including licensing of wells to reduce construction of new illegal wells (by one estimate, there are 10,000 legal and about 40,000 illegal wells), ensure safe distances between wells and from springs, and impose and enforce heavy penalties for violations; (v) at the level of farmers, empower beneficiaries of irrigation scheme to participate in, and take control of, O&M management, at the system level agreed upon, through the establishment of WUAs. This would simultaneously promote project ownership and reduce the fiscal burden; and (vi) carry out periodic public awareness campaigns by MOEW, LRA, and WAs to inform policy makers and the public of water shortages that could be faced in the next thirty years, and the need for water conservation for irrigation, as well as for domestic and industrial uses. Improving competitiveness of agriculture is key. Lebanese agriculture is less competitive and has a higher cost structure than neighboring countries. Improving competitiveness is key to the future of agriculture in Lebanon. Recommendations in this regard include: produce high value added crops such organic food, wines, medicinal plants and herbs, in addition to high value fruits and vegetables, reduce costs through increasing cropping intensity of irrigated agriculture, use less agro-chemicals, adopt more efficient irrigation technology (increase drip and sprinkler use), and over the long term mitigate the impact of 54 structural obstacles such as small and fragmented holdings and the land tenure system. The role of the extension and research services of the MOA in this regard will be essential. Lebanon has a good potential to expand the export of high quality processed food products to the EU, the Gulf, and the US. The falling exchange rate should also improve the competitiveness of agricultural and processed food products. Export market development is necessary to absorb increased production. GOL has in place policies to stimulate agriculture and the other productive sectors (Kafalat, IDAL, and the Export Plus scheme). Lebanon has made a good start in hiring three international firms for quality control of agricultural produce for export. But more efforts are needed, including improving product quality to meet EU and international standards, certification of pesticide levels in exports by an internationally accredited laboratory, waging an aggressive marketing campaign and hiring a European firm by exporters for market development, and provide real time market data and information by IDAL or Chambers of Commerce on tariffs, country of origin, and other export requirements in the destination markets. INSTITUTIONAL ASPECTS The institutional capacity of the Water Authorities needs strengthening. The four WAs were established to incorporate the 22 RWAs and 209 local water committees in the water sector. Although WAs in principle have administrative and financial autonomy, the executive regulations and bylaws governing them have not been issued yet, and as a result, they face serious staffing and financial constraints. Their first priority is potable water, and they have not been able to oversee all the RWAs and water committees. In view of their limited administrative and financial capacity, WAs have expressed the need for farmers to assume responsibility for the O&M functions of irrigation schemes through the formation of WUAs, which is strongly endorsed by the Note. Other actions are also needed, including: (i) accelerate issuing the executive regulations and bylaws to empower WAs with the autonomy envisaged by Water Law No. 221 of May 2002, and enable the WAs to operate on a commercial basis and appoint key technical staff to fill gaps in the present organization; (ii) pass legislations to update laws regulating the water sector, and in particular provide a legal framework governing WUAs, and addressing the issue of acquired water rights; and (iii) start/complete computerization of customer data base including connections, billing, and collections. Moreover, the capacities of the MOEW, of the RWAs, and of the LRA need strengthening in the areas of water quality testing and monitoring, data analysis, quality assurance and control, and database and reporting, which are urgently needed. A bigger role for the private sector is needed. GOL is commended for its policy of, and commitment to, a public-private partnership in water resource management in Lebanon. As evidence of WA commitment to private participation in water resource management, the WA for the North has already signed a contract with a French company for assuming the functions of operation and maintenance of the distribution network and collection of bills for potable water in Tripoli on a trial basis for one year, the WA for the South is preparing the groundwork to improve its performance and financial position as a pre-requisite to privatization of the management of the potable water supply system for Sidon, and the chairman of the WA for the Bekaa endorses private sector management of the potable water supply systems in Zahle and Baalbeck. GOL goes even further and is seriously considering the potential for privatization of the services of WAs (which manage both domestic and irrigation). WUAs are the way to go. Furthermore, best practice has shown that the most successful projects are those that involve stakeholder participation in the design and management of the project. Since GOL has stopped subsidizing O&M of irrigation schemes, it becomes necessary for farmers to manage their own schemes. In this connection, the Note has the following recommendations: 55 a. It is imperative to start as soon as possible the creation of formal WUAs, not only on a pilot basis, but also on a larger scale (if possible) in all the different Muhafazats. This will necessitate concerted and sustained efforts from all concerned parties. The WUAs should eventually replace the different organizations currently in charge of O&M functions of irrigation schemes; b. the creation of the formal WAUs necessitates the presence of an enabling legal framework, which does not yet exist in Lebanon. This involves different experts in the legal, technical, financial, and social fields. The framework, where the roles and responsibilities with respect to water management (including quality management) of the WUAs and other partners, needs to be prepared in close cooperation with the intended beneficiaries and other interested groups; c. WUAs would be responsible for the O&M of their schemes, for the collection of water fees, and for the payment of fees to the authority responsible for providing the bulk water and other services; and d. well-focused training related to the establishment and management of WUAs should be provided to all involved parties. The newly established WAs are in favor of this approach and would support the establishment of the WUAs as this would reduce their administrative and financial burdens. However, the WAs would remain in charge of the O&M of larger main canals, intake structures and pumping stations which are often well above the farmers' capacities. Also, the institutional capacity of WAs and WUAs should be upgraded to enable them to play an important role in water quality management and pollution control. Moreover, MOEW should continue to assist the WAs and regional and local committees in the O&M of irrigation schemes, especially those which are in bad state of repair, until the WAs become fully operational. Large civil works should remain the MOEW responsibility. Private-Public partnership should be considered. The PN proposes another option for consideration by GOL, which has been implemented in Morocco and Egypt. The proposal involves giving a role to the private sector as a potential partner in public investment, and/or management by an irrigation scheme, which can be designated as a pilot, and if successful can be replicated. In this option, a private firm would be in charge of O&M functions of the scheme, and in partnership with stakeholder, would decide on the level of service needed by farmers, and set irrigation water tariffs to cover those O&M services. It should be noted that GOL is also considering the construction of the El Bared dam and reservoir scheme on a BOT basis. ENVIRONMENTAL ASPECTS The main environmental issues relating to irrigation/water have been discussed earlier: most of the wastewater networks are either damaged or undersized and collected wastewater is discharged without treatment into rivers, springs, groundwater, and the sea; wastewater treatment facilities are in severe shortage; industrial wastes are discharged without treatment into various water bodies; and excessive pumping and use of agro-chemicals increase salinity and pollute aquifers. There is only intermittent monitoring of water quality, and there are only a few laws dealing with pollution. Moreover, MOE has a weak institutional capacity, and an enforcement mechanism is lacking. Environmental mitigation measures are essential for improving water quality. The main recommendations in this regard are: (i) establish a national water quality program for monitoring surface and groundwater resources, and in particular the Litani basin; (ii) start pilot projects for testing different technologies and practices for the reuse of treated effluent from municipal plants; (iii) establish and implement the "polluter pay" concept to be commensurate with the degree of pollution; and (iv) 56 strengthen the capacity of agencies dealing with water quality testing, data analysis, quality assurance and control, as well as establishing and maintaining databases on water quality. AREAS OF POSSIBLE BANK SUPPORT Based on review of the public investment program in irrigation, discussions with GOL officials, and in particular the staff of CDR, MOEW and LRA, and on assessment of the institutional capacity of implementing agencies, it was possible to identifysome areas for possible Bank support in the irrigation sector in Lebanon, as shown below South Bekaa Phase II Project. This project would improve irrigation on 6,700 ha which are currently irrigated through uncontrolled private pumping. The 2002 updated feasibility study showed that the project is viable, since a significant proportion of the major investments in basic infrastructure have already been made in Phase I that was financed by the Bank and GOL. In addition to providing irrigation water to farmers below the cost of private pumping, the project has a positive environmental impact by reducing the spread of uncontrolled well drilling, and improving the efficiency of irrigation water through a pressurized irrigation system. This project also facilitates the application of volumetric-based water charges. The total cost of the project, excluding contingencies, is US$45 million. The implementing agency is LRA, and the implementation period is four to five years. South Qaraoun Irrigation Scheme. A feasibility study is underway, and its results will be provided to the Bank when completed. At an estimated cost of US$5 million, the project would irrigate an area of 800 ha from the Qaraoun reservoir. LRA would implement the project in two years. El Bared Dam and Reservoir Scheme. The project consists of the construction of a storage dam on the El Bared river with a storage capacity of 40MCM and rehabilitation of the irrigation conveyance and distribution network. The project provides drinking water (20 percent) in addition to irrigation water (80 percent). Although a feasibility study has not been carried out, the project is expected to be viable since it capitalizes on existing infrastructure, and includes rehabilitation and/or modernization of the existing irrigation network. The importance of the project is two-folds: it would provide water to irrigate around 4,000 ha (assuming irrigation requirements of 8,000 m3/ha), in some of the poorest Cazas in Lebanon (Akkar, Minieh, and Dannieh), in addition to providing drinking water for Tripoli and surroundings. The estimated cost of the project is US$45 million, to be implemented by MOEW over a period of 4 years. GOL and donors are expected to finance the storage dam, or the dam could be implemented on a Build- Operate-Transfer (BOT) basis. The Bank could finance rehabilitation and modernization of the irrigation network for around 4,000 ha. Institutional Support to WAs/WUAs. One of the main findings of the Policy Note is the widespread support of WAs and MOEW for the establishment of WUAs. The Bank can play an extremely useful role in this regard by providing technical support for establishing the legal framework needed for the operation of WUAs, the formal creation of WUAs, possibly in all the Muhafazats, and training of staff of concerned agencies. This is now more urgent since GOL stopped subsidizing O&M of irrigation schemes operated by local water committees. WUAs would eventually replace other organizations in charge of O&M functions of irrigation schemes. For the success of WUAs, some principles should be observed (Dinar and Subramanian 1997): (i) determine the level of service required and agreed by beneficiaries; (ii) estimate the O&M costs and allocate costs for the desired level of service; (iii) involve beneficiaries at an early stage in determining the level of service and in allocation of costs; (iv) assess willingness and capacity of users to cover O&M costs; (v) determine the appropriate mechanism for charging users. It is important that the fee structure should be simple to administer and equitable; and (vi) there should be a direct link between the payment 57 of fees and services provided by the WUA (in some schemes, user fees are paid to the Treasury). The proposed project could support WAs, MOEW, and LRA in addressing these aspects. Another area of possible Bank support involves human resource capacity building of MOEW and LRA in the technical and management, fields to enable them to carry out their proposed investment programs. Evaluating the Feasibility of Proposed Irrigation Schemes. Many irrigation schemes proposed by MOEW or LRA are at the preliminary study phase. Before any irrigation scheme is undertaken, it is imperative to carry out a full-fledged feasibility study to determine the economic feasibility of the proposed project, taking into consideration the social aspects of the project. The World Bank can assist GOL in this regard through review of terms of reference for consultants, selection of consultants, and review of feasibility studies. Agricultural Services. In addition to the above, any new investment by the Bank in the irrigation sector should be accompanied by parallel investments in the agricultural sector in order to ensure that high value horticultural crops are being produced (through better extension and research) and that their marketing channels are ensured (through better quality control and marketing information). 58 Appendix 1 Overview of Irrigation Schemes in Lebanon Table A1.1 Existing schemed irrigation Equipped area Net irrigated Surface Sprinkler Drip irrigation Cereals winter Fruit trees Vegetables Code Scheme name (ha) area (ha) irrigation (ratio) irrigation (ratio) (ratio) wheat (ratio) (ratio) (ratio) 1 Akoura-Laqlouk 1,100 990 0.000 0.000 0.000 0.06 0.64 0.30 2 Qartaba & Surroundings 250 230 0.000 0.000 0.000 0.06 0.64 0.30 Lassa, Ghabat, Mezarib, Mghairi, Afqa & 3 Surroundings 120 110 0.000 0.000 0.000 0.06 0.64 0.30 4 Ehmej and Surroundings 700 630 0.000 0.000 0.000 0.06 0.64 0.30 5 Adonis (Kesserouan) 400 360 0.000 0.000 0.000 0.02 0.65 0.33 6 Kfardebian and Faraya 540 490 0.000 0.000 0.000 0.02 0.65 0.33 7 Mayrouba and Hrajel 340 310 0.000 0.000 0.000 0.02 0.65 0.33 8 Nahr El Kalb - El Wata 80 70 0.000 0.000 0.000 0.02 0.65 0.33 Beskinta-Sannine and 9 Bekaata 320 290 0.000 0.000 0.000 0.00 0.81 0.19 10 Antelias 100 90 0.000 0.000 0.000 0.00 0.81 0.19 Hammana - Tarchich- 11 Aintoura & Surroundings 200 180 0.000 0.000 0.000 0.00 0.81 0.19 Dayshounieh- Hazmieh 12 & Surroundings 100 90 0.000 0.000 0.000 0.00 0.77 0.23 13 South Beirut Suburbs 300 270 0.000 0.000 0.000 0.00 0.77 0.23 Wadi Chahrour & 14 Surroundings 200 180 0.000 0.000 0.000 0.00 0.77 0.23 15 Nabaa Es Safa 860 770 0.000 0.000 0.000 0.02 0.77 0.21 16 Jahiliye 150 140 0.000 0.000 0.000 0.02 0.77 0.21 17 Dammour Plain 400 360 0.000 0.000 0.000 0.02 0.77 0.21 18 Jiyeh 100 90 0.000 0.000 0.000 0.02 0.77 0.21 19 Nabaa El Barouk 280 250 0.000 0.000 0.000 0.02 0.77 0.21 59 Table A1.1 Existing schemed irrigation Equipped area Net irrigated Surface Sprinkler Drip irrigation Cereals winter Fruit trees Vegetables Code Scheme name (ha) area (ha) irrigation (ratio) irrigation (ratio) (ratio) wheat (ratio) (ratio) (ratio) 20 Bouqaiaa 1,100 990 0.000 0.000 0.000 0.35 0.17 0.48 Mashta Hassan-Mashta 21 Hammoud-Chadra 810 730 0.000 0.000 0.000 0.35 0.17 0.48 22 Akkar El Attica 560 500 0.000 0.000 0.000 0.35 0.17 0.48 Akkar Highland Farms - Karm Sbat & 23 Surroundings 200 180 0.000 0.000 0.000 0.35 0.17 0.48 24 Fneideq-Mechmech 990 890 0.000 0.000 0.000 0.35 0.17 0.48 Joumeh Area- Rahbeh - 25 Takrit & Surroundings 400 360 0.000 0.000 0.000 0.35 0.17 0.48 Akkar Plain and Arka 26 River 8,000 7,200 0.000 0.000 0.000 0.35 0.17 0.48 27 Akkar El Bared 800 720 0.000 0.000 0.000 0.35 0.17 0.48 28 Minieh 1,220 1,100 0.000 0.000 0.000 0.17 0.59 0.24 29 Tripoli 200 180 0.000 0.000 0.000 0.17 0.59 0.24 30 Zgharta 500 450 0.000 0.000 0.000 0.11 0.78 0.11 31 Danniyeh 5,000 4,500 0.000 0.000 0.000 0.17 0.59 0.24 32 Ehden 450 410 0.000 0.000 0.000 0.11 0.78 0.11 33 Bcharre 840 760 0.000 0.000 0.000 0.05 0.87 0.08 34 Tannourine 330 300 0.000 0.000 0.000 0.06 0.62 0.32 35 Kfarhilda 80 70 0.000 0.000 0.000 0.06 0.62 0.32 36 Batroun Plain 100 90 0.000 0.000 0.000 0.06 0.62 0.32 37 Saida-Jezzine 390 350 0.000 0.000 0.000 0.19 0.66 0.15 38 Qasmieh - Ras El Ain 4,440 4,000 0.000 0.000 0.000 0.19 0.66 0.15 39 Hermel High land Farms 1,100 990 0.000 0.000 0.000 0.50 0.09 0.41 40 Marjhine 160 140 0.000 0.000 0.000 0.50 0.09 0.41 41 Hermel Watershed 650 590 0.000 0.000 0.000 0.50 0.09 0.41 42 Assi Plain 400 360 0.000 0.000 0.000 0.50 0.09 0.41 43 El Qaa 3,000 2,700 0.000 0.000 0.000 0.36 0.28 0.36 44 Oyoun Taqtaq 100 90 0.000 0.000 0.000 0.50 0.09 0.41 45 Ras Baalbeck 300 270 0.000 0.000 0.000 0.36 0.28 0.36 60 Table A1.1 Existing schemed irrigation Equipped area Net irrigated Surface Sprinkler Drip irrigation Cereals winter Fruit trees Vegetables Code Scheme name (ha) area (ha) irrigation (ratio) irrigation (ratio) (ratio) wheat (ratio) (ratio) (ratio) 46 Laboue 2,080 1,870 0.000 0.000 0.000 0.36 0.28 0.36 47 Chaat & Surroundings 800 720 0.000 0.000 0.000 0.36 0.28 0.36 48 Younine 100 90 0.000 0.000 0.000 0.36 0.28 0.36 Oyoun Orghosh - Barqa- 49 Nabha & Surroundings 400 360 0.000 0.000 0.000 0.36 0.28 0.36 50 Yammouneh 5,600 5,040 0.000 0.000 0.000 0.36 0.28 0.36 Wadi Nahle & 51 Surroundings 150 140 0.000 0.000 0.000 0.36 0.28 0.36 52 Iaat Plain 270 240 0.000 0.000 0.000 0.36 0.28 0.36 Baalbeck Plain-Douris & 53 Surroundings 2,000 1,800 0.000 0.000 0.000 0.36 0.28 0.36 Haouch Barada - Majdaloun & 54 Surroundings 1,000 900 0.000 0.000 0.000 0.36 0.28 0.36 55 Talia & Surroundings 1,000 900 0.000 0.000 0.000 0.36 0.28 0.36 Yahfoufa, Jenta, Seraain 56 & Surroundings 1,670 1,500 0.000 0.000 0.000 0.17 0.22 0.61 57 Maaraboun & Ham 120 110 0.000 0.000 0.000 0.36 0.28 0.36 Rayak, Ali Nahri & 58 Surroundings 870 780 0.000 0.000 0.000 0.17 0.22 0.61 Terbol - Delhamieh & 59 Surroundings 1,500 1,350 0.000 0.000 0.000 0.17 0.22 0.61 60 Zahle & Surroundings 2,000 1,800 0.000 0.000 0.000 0.17 0.22 0.61 61 Chtaura - Qab Elias Plain 2,000 1,800 0.000 0.000 0.000 0.17 0.22 0.61 Anjar-Chamsine & 62 Surroundings 1,500 1,350 0.000 0.000 0.000 0.17 0.22 0.61 South Bekaa (Phase I), 63 Left Bank 2,220 2,000 0.000 0.000 0.000 0.17 0.22 0.61 64 Iqlim El Touffah 320 290 0.000 0.000 0.000 0.43 0.20 0.37 Nabatiyeh (Al Midane 65 Plain) 220 200 0.000 0.000 0.000 0.43 0.20 0.37 66 Marjeyoun & Khiam 620 560 0.000 0.000 0.000 0.61 0.08 0.31 61 Table A1.1 Existing schemed irrigation Equipped area Net irrigated Surface Sprinkler Drip irrigation Cereals winter Fruit trees Vegetables Code Scheme name (ha) area (ha) irrigation (ratio) irrigation (ratio) (ratio) wheat (ratio) (ratio) (ratio) Plain 67 Hasbani 500 450 0.000 0.000 0.000 0.44 0.45 0.11 Total 65,600 59,070 Source: Area: JICA Study based on the reference shown in "Reference Sheet" and interview with authorities concerned Ratios of irrigation method, irrigated crops and water source: MOA and FAO census (2000) Table A1.2 Proposed and/or ongoing irrigation schemes Cost estimates Us$ million Irrigated New irrigated (including studies No Scheme name area (ha) area (ha) Impl. Authority and supervision) Remarks 66.5 (Lebanon's Dam on River El Kabir with Syria; Storage 70 MCM; 1 Noura Tahta 10,000 2,000 MOEW share) For PW & I. 122.5 (excluding In two phases on river El Assi to utilize Lebanon's networks, estimated share of water. Incl. 2 diversion dams, 6 pump stations at a further US$ 130 and a 37 MCM storage and hydropower dam. For I , 2 El Assi 6,600 6,600 MOEW million) PW & P. Dam on river Bared with 40 MCM storage capacity for 3 El Bared 3,000 - MOEW 46.5 PW and I (including PW for Tripoli). Diversion of water from Abu Ali river to fill 10 MCM 4 Iaal 1,300 1,300 MOEW 46.5 reservoir for PW and I. Program for construction of 20 hill lakes for Hill Lakes multipurpose uses to be implemented by 2020, at the 5 (20 No.) 2,500 2,500 MOEW 150.00 rate of one to two per year. Including yammouneh dam & reservoir, Qarqaf dam, 6 Other Dams TBD TBD MOEW 119.0 El Jenna dam, youneen dam for multipurpose uses Funding to be determined. Continuation of project 7 Sout Bekaa II 6,700 - LRA 45.0 funded by WB/GOL 8 South Qaraoun Irrigation 800 800 LRA 5.0 Funding from LRA budget 62 Table A1.2 Proposed and/or ongoing irrigation schemes Cost estimates Us$ million Irrigated New irrigated (including studies No Scheme name area (ha) area (ha) Impl. Authority and supervision) Remarks South Bekaa Right Bank Rehabilitation and Modernization assumed to be 9 and North 12,800 - LRA (25.6) carried out from 2020 to 2030 Consulting services and implementation of 51 km main canal, 69 km secondaries to provide water for 12 sectors. Co-financing Arab and Kuwait Funds (US$165 South Lebanon Conveyor million). Conveyance of 90 MCM/year for irrigation 10 800: Phase 1 - - LRA 216.78 and 20 MCM/year PW Irrigation networks for 13, 230 ha in 12 sectors and South Lebnon Conveyor provision of PW. Co-financing anticipated from Araba 800: Phase II 13,230 13,230 LRA 242.47 and Kuwait Funds Including 1,200 ha in Awali-Sainiq sector and northern 11. Conveyor Anane-Nabatieh 4,700 4,700 LRA 104.85 pipeline to Kharoob province for PW Rehabilitation of Pilot Project, of which 330 ha 12. Saida-Jezzine 1,200 1,200 LRA 5.80 currently irrigated To increase irrigated areas between elevations 100 and 13. Qasmieh-Ras El Ain II 2,100 2,100 LRA 15.0 200 above MSL Dam with storage capacity of about 128 MCM at level 230 above mean sea level to irrigated areas between elevations 200 and 500 above mean sea level. Funding 14. Khardale Dam Project 9,000 9,000 LRA 8.0 not secured to date Dam with storage capacity of 10-12 MCM to irrigated areas between sea level and 100 meters above mean sea 15. Kafarsir Dam Projet (1,000) (1,000) LRA 8.0 level. Funding not secured to date Private Sector, Misc. Small Private NGOs with grant Small developments of irrigation areas by NGOs 16. Development 6,200 6,200 aid 12.50 assisted by grant funding etc. Total 80,530 50,000 1,356,000 Storage 160 MCM 63 Appendix 2 Water Resources and Use in Lebanon Table A2.1 Crop water requirements (mm/month) Crop JAN Feb Mar Apr May June July Aug Sep Oct Nov Dec Vegetable 70.9 108 166 202 107 Potato 59.1 87.3 217 166 45 Cereal 35.5 52.4 171 235 125 Sugar beet 41.4 61.1 200 194 96.9 31.4 Cotton 14.9 51.3 63.1 185 215 109 62.1 Tobacco 59.1 106 206 115 Olive 25.2 31.1 42.6 58.1 73.3 90.2 94.1 89.4 71.6 51.7 35.532.7 26.7 Grape 32.7 40.5 55.4 75.6 95.3 117 122 116 93 67.3 46.1 34.7 Banana 45.3 56 76.8 105 132 162 169 161 129 93.1 63.9 48.1 Citrus 37.8 46.7 64 87.2 110 135 141 134 107 77.6 53.2 40.1 Wheat 40.3 45 68.2 107 176 122 27.5 42.8 Table A2.2 Effective rainfall (mm/month) Region Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec N. Lebanon 133.3 96.6 92.3 48.5 15.9 1.0 0.3 0.7 11.1 49.2 88.0 128.6 N. Mountain 147.6 138.4 111.4 60.6 30.4 5.0 1.0 1.0 5.0 30.4 79.2 118.1 C. Lebanon 133.4 116.1 80.6 47.7 18.4 2.0 5.9 43.5 104.1 129.4 C. Mountain 154.2 151.0 138.5 77.4 34.4 2.0 0.5 5.0 5.0 42.5 104.7 147.7 S. Lebanon 135.0 111.4 72.5 39.4 6.9 0.7 0 0 4.6 32.4 68.9 131.5 Inland Assi 81.3 69.8 48.5 29.5 13.7 1.0 0 0 1.0 6.9 43.5 65.2 Inland Litani 112.9 93.7 69.7 37.7 14.6 0.7 0 0 0.7 20.9 53.7 99.3 Inland Hasbani 133.4 128.6 102.4 64.5 24.9 1.0 1.0 1.0 3.0 23.1 77.8 120.0 Average 128.9 113.2 89.5 50.7 19.9 1.7 0.4 0.4 4.5 31.1 77.5 117.4 64 Table A2.3 Field water requirements (mm/month) Crop Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Vegetable 53 107 166 201 102 Potato 41.2 85.9 216 166 40 Cereal 17.5 51 171 235 120 Sugarbeet 23.4 59.7 200 194 91.9 Cotton 33.4 61.7 184 214 104 28.3 Tobacco 41.2 105 205 115 Olive 9.3 55.4 88.8 93.9 89.1 66.6 18 Grape 26.7 77.3 116 122 116 88 33.5 Banana 55.8 114 161 169 161 124 59.4 Citrus 38.4 92 134 141 134 102 43.8 Wheat 57.7 158 121 Table A2.4 Diversion water requirements for surface irrigation (MCM/year) Region Veg. Potato Cereal Sugarb Cotton Tob. Olive Grape Ban. Citrus Wheat N. Leb. 9083 7850 8600 8350 9083 6717 6017 8383 12050 9983 4900 N. Mount. 10317 9033 9717 9317 6933 7700 6767 9350 13683 11050 5550 C. Leb. 10967 9567 10283 9917 10917 8167 7817 10633 15683 12633 6917 C. Mount. 8100 7083 7700 7317 7950 5967 5033 6883 10300 8250 3650 S. Leb. 9833 8567 9400 8950 9617 7167 6217 8350 12317 9875 4233 Inl. Assi 13350 11833 12683 12650 13717 10033 9800 13150 19083 15517 7633 Inl. Litani 12033 10600 11400 11133 12183 8967 8517 11450 16633 13450 6617 Inl. Hasbani 4863 8400 9167 8757 10067 7067 6817 9250 13567 10983 5183 Average 9818 9117 9869 9549 10058 7723 7123 9681 14165 11468 5585 65 Table A2.5 Diversion water requirements for sprinkling irrigation (MCM/year) Region Veg. Potato Cereals Sugarb Cotton Tobac. Olives Grapes Ban. Citrus Wheat N. Leb. 7786 6729 7371 7517 7786 5757 5157 7186 10329 8557 4200 N. Mount. 8843 7743 8329 7986 5943 6600 5800 8014 11729 9471 4757 C. Leb. 9400 8200 8814 8500 9357 7000 6700 9114 13443 10829 5929 C. Mount. 6943 6071 6600 6271 6814 5114 4314 5900 8829 7071 3129 S. Leb. 8429 7343 8057 7671 8243 6143 5329 7157 10557 8464 3629 Inl. Assi 11443 10143 10817 10843 11757 8600 8400 11271 16357 13300 6543 Inl. Litani 10314 9086 9771 9543 10443 7686 7300 9814 14257 11529 5671 Inl. Hasbani 4169 7200 7857 7506 8629 6057 5843 7929 11629 9414 4443 Average 8416 7814 8459 8185 8621 6620 6105 8298 12141 9829 4788 Table A2.6 Diversion Water Requirements for Drip Irrigation (MCM/year) Region Veg. Potato Cereals Sugarb Cotton Tobac. Olives Grapes Ban. Citrus Wheat N. Leb. 6813 5888 6450 6263 6813 5083 4513 6288 9038 7488 3675 N. Mount. 7738 6775 7288 6988 5200 5775 5075 7013 10263 8288 4163 C. Leb. 8225 7175 7713 7438 8188 6125 5863 7975 11763 9475 5188 C. Mount. 6075 5313 5775 5488 5963 4475 3775 5163 7725 6188 2738 S. Leb. 7375 6425 7050 6713 7213 5375 4663 6263 9283 7406 3175 Inl. Assi 10013 8875 9513 9488 10288 7525 7350 9863 14313 11638 5725 Inl. Litani 9025 7950 8550 8350 9138 6725 6388 8588 12475 10088 4963 Inl. Hasbani 3648 6330 6875 6568 7550 5300 5113 6938 10175 8238 3888 Average 7364 6838 7402 7162 7544 5792 5342 7261 10623 8601 4189 66 Appendix 3 Pollution and Treatment of Water Sources in Lebanon Table A3.1 Expected and planned wastewater treatment plants Capacity Disposal Expected Starting Caza Location (m3/day) Type of Treatment Mean Year Under Execution Chekka Chekka 2,700 Secondary Sea 2005 Batroun Batroun 2,900 Secondary Sea 2005 Jbail Jbail 5,300 Secondary Sea 2005 Chouf Coastal Chouf 6,240 Secondary Sea 2005 Saida Saida 36,700 Primary Sea 2005 Nabatieh Nabatieh 8,228 Secondary Drainage 2005 Baalbek Baalbek 12,412 Secondary activated Drainage/re-use 2004 Yammounah Yammouneh Secondary Drainage/reuse 2005 Tripoli Tripoli 134,500 Secondary Sea 2006 Under Preparation Akkar Michmich 7,400 Secondary Drainage/re-use 2008 Bakhoun Bakhoun Secondary Drainage/reuse 2008 Jbeil Kartaba 1,435 Secondary Drainage/re-use 2007 Kesrouane Hrajel Secondary Drainage/re-use 2008 Chouf Mazraat Chouf 30 Secondary Drainage/re-use 2009 Hermel Hermel Secondary Drainage/re-use 2009 Baalbeck Laboue Secondary Drainage/re-use 2008 Zahleh Zahleh 37,000 Secondary Drainage/re-use 2005/2006 Anjar/Majdal Anjar Anjar Secondary Drainage/re-use 2008 West Bekaa Karaoun 3,600 Secondary Drainage/re-use 2009 Joub Jannine Joub Jannine 10,700 Secondary Drainage/re-use 2007 Saghbine Saghbine 600 Secondary Drainage/re-use 2007 Hasbaya Hasbaya Secondary Drainage/re-use 2009 Nabatieh Jbaa Secondary Drainage/re-use 2009 North Beirut Bourj Hammoud Jbaa 330,000 Secondary Sea 2007 South Beirut Ghadir 290,000 Secondary Sea 2009 67 Table A3.2 Laws relating to the pollution and protection of water resources Document Date Subject Responsible Ministry Order No. 144 10.06.1925 Protection of Surface and Ground Water Resources MOEW Order No. 320/26 26.05.1926 Protection of Catchment Areas MOEW Decree No. 639 26.03.1942 Protection of Nabaa Al Assal Spring, Faraya MOEW Decree No. 10276 07.10.1962 Protection Zones for Water Sources and Recharge Areas MOEW Decree No. 14438 02.05.1970 Restrictions on the Depth of Unlicensed Boreholes MOEW Decree No. 8735 23.08.1974 Pollution from Solid and Liquid Wastes MOI/MOE Law No. 64 18.08.1988 Pollution from Hazardous Wastes MOI/MOE Decision No. 2528/C 28.05.1996 Protection of Ground Water at El Kneisse MOEW Decree No. 680 15.09.1998 The Preservation and Protection of Boreholes MOEW 68 Appendix 4 Historical Review of Water Laws in Lebanon CODIFIED LAW While appreciating the evolution of water use regulations, guided by precept, but modified by region and custom, the primary concern of contemporary water-use specialists is with written regulations of legal standing, since these are fundamental to modem irrigation projects. Thus, it is appropriate to present details of the codification process, the Ottoman civil code, which applied to most of the Near East region, and some modern trends in water legislation in this region. The FAO publication "Irrigation and drainage paper 20/1 & 2 edited by Caponera states that: "The codification of the Moslem law was initiated during the Ottoman Empire period (1300 - 1922 AD). It rested originally on the Shari'a or Moslem religious law, and the Qawanin-hukm, or decrees and ordinances issued by the sultans". Early codes remained in force until 1839, the year in which reforms (transmit) were undertaken. During a second period or reforms (1845 - 1876), the civil law was codified in what became known as the Mejelle Code. Separate sections covered the law of contract, part of the law on real property ownership, and the law of civil procedure. The condition of Moslem religious law (Shari'a) was, however, restricted to penal law and procedure. The Penal Code was subsequently modified along the lines of European models. The Mejelle Code was framed on the basis of the Napoleon Code by Ottoman legislators, who selected from its rules those in conformity with or upholding Moslem law principles and which were, at the same time, most easily adaptable to existing social needs. This law was implemented in Lebanon in 1870, when a decree was issued by the Sultan to transport water from the Kalb river to Beirut city for drinking purposes. This caused a legal problem between the owners of water rights and the exclusive company entrusted with the execution of the project. THE OTTOMAN CIVIL CODE Although the Mejelle Code itself has now been superseded, a number of its provisions, nevertheless, still govern legislation of some countries, which had formed part of the Ottoman Empire. An analysis thereof is of a more than purely historical interest. Definition of Water. The Mejelle Code "Nicolaides D. La Medjelle, Code Civile de l'empire ottoman, Corps de Droit ottoman, Constantinople, 1881 - 1888" defines water as a non-sellable commodity to which everyone has a right (mubah). Ground-waters as well belong to the community. The definition of water as a non-sellable, publicly owned commodity applies to running water, which has not been appropriated, to water contained in wells dug by unknown persons, and to water of the sea and large lakes. Rivers are divided into two categories, those forming part of the public domain the beds of which are not privately owned, and privately owned rivers flowing on private land. Water Ownership and Use. Water ownership is acquired by gift, inheritance or occupation on condition that the land is occupied with the intention of taking procession thereof. The Ottoman Code recognized two basic legal principles: · Water for Drinking and Animal Watering (hakki chefe): Everyone may quench his thirst from both public and privately owned rivers. 69 · Water for Irrigation (Hakki Chirb): In the case of rivers and lakes forming part of the public domain, and since such water constitutes a public commodity, everyone is entitled to use it for irrigation purposes, provided the rights of third parties are not infringed upon. The use of privately owned waterways is restricted to riparian landowners. Sale of Water Rights. The sale of rights of way, of irrigation rights, and of overflow water from conduits is permitted as part of the sale of the land. Maintenance of Waterways. The maintenance of waterways is also governed by the Civil Code. The maintenance of rivers forming part of the public domain is the responsibility of the State. The maintenance of privately owned waterways is the responsibility of the owners, and all co-owners must contribute to initial expenses. LAW 221: ORGANIZATION OF THE WATER SECTOR ­ 2000 The law is composed of 11 articles, the most interesting of which are the fourth, fifth and sixth. In its fourth article, the law defines the responsibilities of the Water Authorities (WAs) as follows: · Study, execution, operation and maintenance of potable water supply and irrigation projects according the General Master Plan or as per the instructions of the MOEW. · Proposing water tariffs for potable water supply and irrigation taking into account the socio-economic conditions. · Control of the water quality. It also stipulated that they should contract and independent Auditor to audit their accounts. In its fifth article, the law stipulates that the management of the WAs is through Managing Boards composed of a President and six members who are nominated by the Council of Ministers upon propositions made by the Minister of Energy and Water. The President of the Board is also the Director General. In its sixth article, the law stipulates that "post" financial controls of the WAs are to be undertaken by the Lebanese "Cour des Comptes" and that an evaluation commission is to be created within the MOEW to evaluate the performances of the WAs. 70 Appendix 5 Operation & Maintenance of Irrigation Systems Table A5.1 Existing Operation & Maintenance Administration and Tariffs (2003) Administration Irrigated Water Water Scheme Designation Area (ha) Authority Committee Municipality Miscellaneous Tariffs $1 W/hour, (5) Yammouneh 4,500 X - - - $1.33 Sp/hour, $1.67 Sm/hour Akkar El-Bared 1,400 - X - - $1.65/ha/year $367/ha/year for gravity and Qasmieh 3,500 X - - - $400/ha/year for pumping. South Bekaa Phase I 200 X - - - $308/ha/year $67/ha/year fixed + $ Danniyeh 2,500 X - - - 1 to $13/ha/year for maintenance Minieh 1,211 X - - - NA Laboueh 2,078 - - - X(1) NA Tannourine 324 - - X(2) - None Kfar Helda 78 - - - X(1) None Bcharré 837 X(3) - - - $7/hour Akkar El-Aatiqa 983 - - - X None Bouqaiaa 1,101 - - - X(4) None Mashta Hassan Ham None 1,028 - - - X(4) Chadra Fneideq 1,291 - - - X(4) None Baskinta 120 - X - - $83/ha/season Kfarzebiane 480 - X - - $10/y/h & $16.7/y/h Aaqoura Laqlouq 764 - X - - None Safa 861 X - - - NA Barouk 215 X - - - NA Iqlim El-Touffah 402 - X - - None Hasbani 419 - X - - None Total 24,292 (1)Farmers agree to share O & M costs. Every group of farmers irrigating from the same canal is responsible of its O & M costs.; although MOEW participate sometimes in covering maintenance costs. (2) Municipality is in charge of water distribution, MOEW covers mainly maintenance costs. (3)O & M costs and revenues are for Bcharre village only; surrounding villages are included to the scheme, farmers undertake and directly finance O & M. (4)Every farmer is responsible for O & M costs of the canal that serves his land. (5) W=winter crop, Sp=spring crop and Sm=Summer crop. (6) Official Water Committees are those created by MOEW with the consent of the beneficiaries. (7) Misc. are those managed by group of farmers with no formal or official mandate. 71 Table A5.2 Operation & Maintenance Arrangements and Tariffs (1995) Equipped Irrigated Project Administration & No Project Name Area (ha) Area (ha) Exploitation Organism Tariffs 1 - North Lebanon 1 Akkar ­ Caza Akkar 795 682 na 2 Machta Hassan­ Machta na Hammoud­ Caza 480 230 Ministerial Committee Akkar 3 Qoubayat ­ Caza na 795 795 Water Authority (WA): Akkar 4 Aakkar ­ Aakkar ­ Caza Ministerial Committee & na 380 286 Akkar Cooperative 5 Fneideq ­ Michmich ­ na 580 580 Ministerial Committee Caza Akkar 6 Municipality & Ministerial 91,00L.LL/ha or 97,000L.LL/ha Minieh ­ Caza Tripoli 1400 1156 Committee with cleaning. 7 Zghorta ­ Caza na 667 667 Ministerial Committee Zghorta 8 Ehden ­ Caza Zghorta 410 410 Ministerial Committee na 9 Becharre ­ Caza na 1480 1480 Ministerial Committee Becharre 10 Tannourine - Caza na 1400 1400 Ministerial Committee Batroun 2 ­ Beirut & Mount Lebanon 1 LL300,000/ha/year for Gravity Adonis ­ Caza Jbeil Water Authority & 737 484 Kesrouane ­ Jbeil (WA): LL425,000/ha/year for Pumping. 2 Kfar Helda - Caza na 100 100 Ministerial Committee Batroun 3 Aqoura ­ Laklouk ­ na 700 700 Ministerial Committee Caza Jbeil 4 Qartaba ­ Caza Jbeil 1000 1000 Ministerial Committee na 5 Faraya - Mazraat Kfar na Debiane ­ Caza 1090 1090 Ministerial Committee 2 Kesrouane 6 Mairouba ­ Hrajel - Ministerial Committee & na 340 340 Caza Kesrouane Cooperative 7 Baskinta Sannine ­ na 377 377 Ministerial Committee Caza Metn 8 Nabaa El-Safa ­ Caza Barouk Water Authority LL10,000/ha/year. 970 970 El-Chouf (WA): 9 El-Barouk - Caza El- Barouk Water Authority LL10,000/ha/year. 494 494 Chouf (WA): 72 Table A5.2 Operation & Maintenance Arrangements and Tariffs (1995) Equipped Irrigated Project Administration & No Project Name Area (ha) Area (ha) Exploitation Organism Tariffs 10 Water Authority (WA) & na Lehfed ­ Caza Jbeil 30 25 Ministerial Committee 11 Ehmej ­ Caza Jbeil 20 15 Farmers Group na 12 Fawar Antelias ­ Caza Ministerial Committee & LL50,000/ha/year. 350 260 Metn Farmers Group 13 El-Jahlieh - Caza El- According to the necessity of 50 50 Ministerial Committee Chouf maintenance and cleaning. 14 Bsaba ­ Caza Baabda 160 30 Farmers Group: na 3 ­ South Lebanon 1 Qasmieh Ras El-Ain - Litani River Authority For Gravity = $250/ha/year and 4017 3500 Caza Saida ­ Sour (LRA): for pumping uS$370/ha/year 2 Ouadi El-Laymoun ­ Ministerial Committee & na 55 50 Caza Jezzine & Saida Farmers Group 3 Nabatiyeh ­ Caza na 242 121 Farmers Group Nabatiyeh 4 ­ Bekaa 1 Municipality, Ministerial LL250,000/ha/year. Hermel ­ Caza Hermel 830 590 Committee & Farmers Group 2 Chtaura ­ Taalabaya - LL20.000/ha/year 1575 1020 Ministerial Committee 2 Caza Zahleh 3 LL20,000/ha/year for spring Ouadi Nahleh ­ Maqne Ministerial Committee & 2450 410 irrigation & No tariff for - Caza Baalbeck Farmers Group summer. 4 Marjhine ­ Caza na 550 350 Ministerial Committee: Hermel 5 El-Massateb - Caza Ministerial Committee & na 122 122 Hermel Farmers Group 6 Aanjar ­ Chamsine ­ Water Authority (WA) & LL50,000/ha/year. 815 815 Caza Zahleh Farmers Group 7 Laboueh ­ Qaa - Caza Ministerial Committee & LL2,500/Hhour/year or 2957 1527 Baalbeck Farmers Group LL25,000 /ha/year. 8 Haouch El-Oumara ­ na Mouaalaka ­ Caza 2082 552 Ministerial Committee Zahleh 9 Yahfoufa ­ Torbol ­ LL20,000/ha/year. Saraaine - Caza Zahleh 2845 2045 Ministerial Committee 2 & Baalbeck 10 Ras El-Ain (Baalbeck) Water Authority (WA) & na 2500 2043 - Caza Baalbeck Ministerial Committee 11 Machghara - Caza LL5,000/Irrigation or 250 250 Farmers Group Bekaa Ouest LL500,000/ha/year. 12 Bab Mareh - Caza na 80 40 Municipality Bekaa Ouest 73 Table A5.2 Operation & Maintenance Arrangements and Tariffs (1995) Equipped Irrigated Project Administration & No Project Name Area (ha) Area (ha) Exploitation Organism Tariffs 13 Aitanit - Caza Bekaa Municipality & Farmers LL50,000/ha/year. 240 138 Ouest Group 14 Kherbet Kanafar - LL70,000/ha/year. 700 700 Farmers Group Caza Zahleh 15 Ras Baalbeck - Caza According to maintenance cost. 90 50 Farmers Group Baalbeck 16 Ain Zebdeh - Caza LL50,000/ha/year. 230 230 Farmers Group Bekaa Ouest 17 Saghbine - Caza Bekaa Municipality & Farmers LL150,000/ha/year. 50 25 Ouest Group 18 Qab Elias ­ Caza LL30,000/ha/year. 800 800 Municipality Zahleh Total 19166 11707 Note: For schemes where no tariffs are imposed, the farmers pay the water guards salaries and canal cleaning. 74 References Caponera, Dante A. 1973. Water Laws in Moslem Countries. Vol 1. FAO Technical Paper. Rome: FAO CDR. 2002. Agriculture Marketing Issues Study. November 2002. Dinar, Ariel and Ashok Subramanian. 1997. Water Pricing Experiences: An International Perspective. World Bank Technical Papers No. 386. Washington, D.C.: World Bank. ESCWA [United Nations' Economic and Social Commission for West Asia]. 1999. Evaluation of Agricultural Policies in Selected ESCWA Countries: A Case Study of Lebanon. New York. FAO [Food and Agriculture Organization] and Ministry of Agriculture, Lebanon. 2000. "Global Result of Agriculture Census". ------. 2000a. Republic of Lebanon: Informal Agriculture Sector Note on the Bekaa Valley. Irrigation in the Near East Region in Figures" (FAO, 1997 Jouzy and Partners, 2003 "Field Surveys for Water Quality Analysis ­ Lebanon". Jurdi, M. « Study of the Quality of Potable Water in Lebanon, 1996 to 1997, Water Research Unit, National Council of Scientific Research, Ministry of Hydraulics and Electrical Resources, Ministry of Public Health, American University of Beirut and UNICEF, 1998. Ministry of Environment, "Decision no 8/1 related to standards for Wastewater Discharges, Lebanon", 2001 Ministry of Social Affairs (MOSA)/UNDP, Mapping of Living Conditions in Lebanon, 1998. MOEW [Ministry of Energy and Water]. 1994. "Etude de Tarification des projets d'Irrigation (in French) ­ ------. 1995. "Tarification des Projets d'Irrigation » MVM Konsult AB, "Environmental Master Plan for Litani River and Lake Qaraoun Catchment Area". Ministry of Environment, Council of Development and Reconstruction, Litani River Authority ad Swedish International Development Cooperation Agency, 2000. Teboddin, « Industrial Pollution Control - Lebanon, Draft Report", The Netherlands, 1998. The World Bank. 2003a. Lebanese Republic: The Agriculture Sector. Desk review prepared by the Middle East and North Africa Social, Rural, and Environment Department. processed. ------. 2003b. Lebanon: Perspectives on Agriculture Sector Issues. Report prepared by the Middle East and North Africa Social, Rural, and Environment Department. Processed ------. 2001. Lebanon Social Protection Note (FY01). UNDP. 1970. Study of Groundwater. 75