Abreha, Z.

Hagos, F.

Kruseman, G.

Linderhof, V.G.M.

Mulugeta, A.

Samuel, G.G.

Yazawa, S

Yohannes, M.

NARCIS 

Small scale water harvesting in Northern Ethiopia: Can it alleviate household poverty?

DSpace at VU

Policy Brief 
No.15 January 2007 
Small scale water harvesting in Northern Ethiopia: 
Can it alleviate household poverty? 
 
Issues facing   
policy-makers: 
 
• Are households with access to 
ponds and wells better off in 
terms of household welfare? 
• If not, why not? Can ponds and 
wells be used more efficiently? 
• Are there other determinants of 
rural household poverty that 
need to be addressed? 
• What would be the most 
appropriate household strategy 
for poverty alleviation in 
Tigray? 
Overview 
Ethiopia is one of the most drought prone countries in the world.  
Yet much of Ethiopia’s economy depends upon adequate and 
reliable rainfall for agricultural production.  Over the years scanty 
and erratic rainfall has led to significant crop losses, and in some 
cases total crop failure.  This means food crises and famine.  
Millions of Ethiopians have been affected.  Half the population is 
chronically poor and nearly one quarter of children born do not 
reach the age of five.  Higher temperatures due to climate change 
only exacerbate the pressure on Ethiopia’s already fragile 
ecosystems. 
In order to fight poverty and famine by providing food security, 
effective development of water resources is vital for Ethiopia.   
Water harvesting is one strategy used to increase agricultural 
productivity and household income.  It is an important tool for 
mitigating the adverse effects of climate change.  Historically, 
water harvesting in Ethiopia dates back to 560 BC, where 
rainwater was harvested and stored in ponds for agricultural and 
water supply purposes.  These days, the construction of ponds and 
wells aims to make water available to irrigate and produce higher 
value crops, as well as to provide water for livestock and 
household use.  However, there has been limited effort to 
systematically assess the impact of these structures on household 
welfare.  Can access to ponds and wells alleviate household 
poverty? 
This study applies advanced econometric techniques to assess the 
impact of water harvesting on household welfare.   The results 
show that access to either ponds or wells is not reflected in higher 
levels of welfare. Ponds and wells are not exploited to their full 
potential because most of the structures are recently constructed. 
One task for policy makers is to come up with technologies to 
improve water use efficiency.  Other results show that labour work 
by men and the holding of livestock reduces poverty.  Therefore a 
good poverty reduction strategy for households might be a mix of 
farming, labour work and livestock holding.  
The Poverty Reduction and Environmental Management Programme: An Institute for Environmental Studies (IVM)  
Initiative, funded by the Dutch Ministry of Foreign Affairs (DGIS). 
P R E M  P O L I C Y  B R I E F  
 
The approach  
Economists analyze agricultural household 
behaviour by using the agricultural household 
model.  This model assumes that an agricultural 
household, such as those in Tigray, engages in 
farming and consumption activities at the same time 
using scarce resources (e.g. money, labour, tools, 
land) in order to attain their goals and aspirations.  
Environmental constraints (e.g. climate, soil fertility) 
and socio-economic constraints (e.g. household 
income) are also taken into account.  A large-scale 
survey of 650 farm households was conducted in 
Tigray to collect information regarding household 
characteristics, demographics, household assets 
and village level factors.    Data was also collected 
from households with and without access to ponds 
and wells in order to assess the impacts of water 
harvesting on household welfare, while controlling 
for other socio-economic features.  With matching 
methods and econometric analysis, the levels of 
 
Study Area  
Ethiopia is located in the Horn of Africa and is 
bordered by Eritrea, Djibouti, Somalia, Kenya 
and Sudan. With a population of 75 million 
people it is the second most populous country 
in Africa.    Ethiopia is divided into nine  
administrative regions, the northernmost of 
which is Tigray.  About 4 million people live 
here, most of whom are farmers.  Tigray has 
a semi-arid climate with scanty and erratic 
rainfall that remains insufficient for crop  
production.  Since 2003, household water 
harvesting schemes have been expanding as 
an integral part of the Tigray regional food 
security and extension programmes, aimed at 
breaking the cycle of famine.  About 30,000 
ponds have been built so far, with more than 
200,000 planned over the next couple of 
years in the more drought prone areas of  
Tigray.  The study draws on data collected 
from 650 households within thirteen tabias 
(villages).  The tabias were selected on the 
basis of i) differences in agro-ecology 
(lowland, middle altitude and highland);  
ii) presence of ponds and water wells;  
iii) distance to market and iv) the availability of 
baseline information.  
N o . 1 4  J a n u a r y  2 0 0 7  
3 
P R E M  P O L I C Y  B R I E F  N o . 1 4  J a n u a r y  2 0 0 7  
welfare for households with and without access to 
ponds or wells were compared. Additionally, a 
simple cost-benefit analysis of the construction and 
maintenance of ponds and wells was carried out.  
This helps us to calculate how financially viable 
ponds and wells are for households in Tigray.   
 
 
Key findings  
1. There are no significant effects on household 
welfare from owning a pond or a well.  
The results show that there is no statistically 
significant difference in welfare standing between 
households with and without access to ponds and 
wells.  Although this study does not fully explore the 
reasons behind these unexpected results, ponds 
and wells are currently not being exploited to their 
fullest potential.  On the one hand, access to ponds 
and wells is still limited for many households, and 
on the other hand, there may also be a period of 
acclimatization needed for households to learn how 
to harvest water efficiently.  As a result, there has 
been little impact on household poverty alleviation.   
 
2. However, the economic return of wells is far 
superior to that of ponds.  
Three criteria were used to financially evaluate the 
benefits of water-harvesting (internal rate of return, 
net present value and benefit-cost ratio).  Basically, 
if the benefits are greater than the costs, then the 
project is worthwhile.  If they are less, then it isn’t.    
Over a ten-year planning period with a crop value of 
3 Birr per kg, both ponds and wells have positive 
economic returns judged by all three criteria (see 
Table 1).   
Table 1: Cost and benefit analysis of ponds / wells 
 
However, the economic return of wells is much 
greater than that of ponds.  Ponds face higher costs 
for construction and maintenance and lower 
revenues compared to wells. Wells store water 
longer than ponds do enabling farmers to grow 
crops (usually high value crops) during the dry 
season. Ponds are promoted and used primarily for 
supplementary irrigation.  
We also calculated the benefits of water harvesting 
over a five year planning period and with a drop in 
crop value to 2 Birr per kg.  This is a realistic 
scenario since the planning horizon of poor farmers 
is short and prices of vegetables and fruits will fall 
with increases in production.  While the economic 
returns of wells are still positive, the returns for 
ponds are negative.  There are various factors 
besides the design and the quality of construction 
that contribute to the success or failure of ponds 
and wells.  These include the discount rate, 
planning horizon of the users, prices of products 
and costs of production.  Much has to go well, 
especially if ponds are to give economically 
attractive returns. 
 
3. There are key household characteristics 
which determine poverty in Tigray.  
This study also explores the factors that help to 
explain household poverty.  Poor households show 
one or more of the following characteristics: they 
are female-headed; have a higher number of 
dependents per productive family member 
consumer-worker ratio (i.e. more consumption per 
worker); have more female than male adult 
labourers; are located in mid- and lowland agro-
ecologies and are further away from the nearest 
health centre.  Since highly variable rainfall makes 
agricultural production uncertain, this uncertainty is 
Revenue
Construction cost
Maintenance cost
Production cost 
Input cost
Output
8.931 
4.295 
655 
2.450
2.977 
14.674 
2.182 
524 
2.301 
269 
6.048 
WellsPonds
Net benefit 1.798 10.847 
Total cost 7.133 4.751 
Amounts (Birr) in Net Present value with r = 10%
4 
P R E M  P O L I C Y  B R I E F  N o . 1 4  J a n u a r y  2 0 0 7  
PREM: In brief 
 
The Poverty Reduction and Environmental  
Management (PREM) programme aims to deepen and 
broaden the exposure of economic researchers and 
policy advisors in Africa and Asia to the theory and 
methods of natural resource management and  
environmental economics. It is anticipated that this will  
encourage policy changes that address both poverty 
reduction and sustainable environmental management.  
 
This policy brief is based on the PREM project 'Water-
harvesting for poverty reduction and sustainable re-
source use: Adaptation strategies to climatic change in 
Tigray region, Ethiopia'  
By: Eyasu Yazawa, Girmay G/Samuel, Fitsum Hagos, 
Gideon Kruseman, Vincent Linderhof, Mekonen Yohan-
nes, Afeworki Mulugeta &Zenebe Abreha 
 
The views expressed herein are not necessarily those 
of PREM or its sponsors. 
The full paper is available online at:  
www.prem-online.org 
 
 
 
For further information about PREM, contact:  
Pieter van Beukering  
Institute for Environmental Studies (IVM)  
Vrije Universiteit 
De Boelelaan 1087 
1081HV Amsterdam The Netherlands 
Tel. +31(20)5989555/Fax. +31(20)5989553 
 
beukering@ivm.vu.nl 
www.prem-online.org     -    www.vu.nl/ivm  
also a key factor in determining household poverty.   
In comparison, wealthier households have a higher 
number of adult male labourers than female 
labourers; own livestock such as oxen; tend to be 
male-headed households and are located in the 
highlands. 
 
Solutions for policy makers   
Since 2003, household water harvesting schemes 
have been expanding as an integral part of the 
Tigray regional food security and extension 
programmes, aimed at breaking the cycle of 
famine.  Currently, there are no significant effects 
on household welfare from owning a pond or a 
well.  The challenge for policy makers is twofold: 
Firstly, to implement strategies which help 
households to optimally utilise ponds and wells 
and secondly, to implement polices which target 
the determinants of household poverty in Tigray. 
 
From our research we advise the following 
solutions: 
• The promotion of ponds at a large scale should 
be approached with caution as they may pose 
more cost than benefits to the households or 
the society at large. 
• Measures such as the promotion of household 
drip kits and crops with high returns and the use 
of shedding to reduce evaporation, should be 
introduced to increase the efficiency of water 
use and minimize water loss. 
• The creation of employment opportunities and 
special support programs for women could 
contribute to poverty alleviation. 
• Policy has to support livestock-poor households 
to have access to such assets, for instance 
through the implementation of credit programs. 
• The provision of social services such as health 
centres plays a critical role in human health, 
and hence, on poverty reduction. 
• The implementation of water harvesting 
structures has to be maintained or even 
strengthened in order to minimize the 
uncertainties posed by unreliable rainfall. 
 
 
 
 


VU Research Portal

VU Research PortalSmall scale water harvesting in Northern Ethiopia: Can it alleviate household poverty?Yazawa, S; Samuel, G.G.; Hagos, F.; Kruseman, G.; Linderhof, V.G.M.; Yohannes, M.;Mulugeta, A.; Abreha, Z.2007document versionPublisher's PDF, also known as Version of recordLink to publication in VU Research Portalcitation for published version (APA)Yazawa, S., Samuel, G. G., Hagos, F., Kruseman, G., Linderhof, V. G. M., Yohannes, M., Mulugeta, A., &Abreha, Z. (2007). Small scale water harvesting in Northern Ethiopia: Can it alleviate household poverty?(PREM Policy Brief; No. 15). Institute for Environmental Studies.General rightsCopyright and moral rights for the publications made accessible in the public portal are retained by the authors and/or other copyright ownersand it is a condition of accessing publications that users recognise and abide by the legal requirements associated with these rights.            • Users may download and print one copy of any publication from the public portal for the purpose of private study or research.            • You may not further distribute the material or use it for any profit-making activity or commercial gain            • You may freely distribute the URL identifying the publication in the public portal ?Take down policyIf you believe that this document breaches copyright please contact us providing details, and we will remove access to the work immediatelyand investigate your claim.E-mail address:vuresearchportal.ub@vu.nlDownload date: 22. May. 2021Policy Brief No.15 January 2007 Small scale water harvesting in Northern Ethiopia: Can it alleviate household poverty?  Issues facing   policy-makers:  • Are households with access to ponds and wells better off in terms of household welfare? • If not, why not? Can ponds and wells be used more efficiently? • Are there other determinants of rural household poverty that need to be addressed? • What would be the most appropriate household strategy for poverty alleviation in Tigray? Overview Ethiopia is one of the most drought prone countries in the world.  Yet much of Ethiopia’s economy depends upon adequate and reliable rainfall for agricultural production.  Over the years scanty and erratic rainfall has led to significant crop losses, and in some cases total crop failure.  This means food crises and famine.  Millions of Ethiopians have been affected.  Half the population is chronically poor and nearly one quarter of children born do not reach the age of five.  Higher temperatures due to climate change only exacerbate the pressure on Ethiopia’s already fragile ecosystems. In order to fight poverty and famine by providing food security, effective development of water resources is vital for Ethiopia.   Water harvesting is one strategy used to increase agricultural productivity and household income.  It is an important tool for mitigating the adverse effects of climate change.  Historically, water harvesting in Ethiopia dates back to 560 BC, where rainwater was harvested and stored in ponds for agricultural and water supply purposes.  These days, the construction of ponds and wells aims to make water available to irrigate and produce higher value crops, as well as to provide water for livestock and household use.  However, there has been limited effort to systematically assess the impact of these structures on household welfare.  Can access to ponds and wells alleviate household poverty? This study applies advanced econometric techniques to assess the impact of water harvesting on household welfare.   The results show that access to either ponds or wells is not reflected in higher levels of welfare. Ponds and wells are not exploited to their full potential because most of the structures are recently constructed. One task for policy makers is to come up with technologies to improve water use efficiency.  Other results show that labour work by men and the holding of livestock reduces poverty.  Therefore a good poverty reduction strategy for households might be a mix of farming, labour work and livestock holding.  The Poverty Reduction and Environmental Management Programme: An Institute for Environmental Studies (IVM)  Initiative, funded by the Dutch Ministry of Foreign Affairs (DGIS). P R E M  P O L I C Y  B R I E F   The approach  Economists analyze agricultural household behaviour by using the agricultural household model.  This model assumes that an agricultural household, such as those in Tigray, engages in farming and consumption activities at the same time using scarce resources (e.g. money, labour, tools, land) in order to attain their goals and aspirations.  Environmental constraints (e.g. climate, soil fertility) and socio-economic constraints (e.g. household income) are also taken into account.  A large-scale survey of 650 farm households was conducted in Tigray to collect information regarding household characteristics, demographics, household assets and village level factors.    Data was also collected from households with and without access to ponds and wells in order to assess the impacts of water harvesting on household welfare, while controlling for other socio-economic features.  With matching methods and econometric analysis, the levels of  Study Area  Ethiopia is located in the Horn of Africa and is bordered by Eritrea, Djibouti, Somalia, Kenya and Sudan. With a population of 75 million people it is the second most populous country in Africa.    Ethiopia is divided into nine  administrative regions, the northernmost of which is Tigray.  About 4 million people live here, most of whom are farmers.  Tigray has a semi-arid climate with scanty and erratic rainfall that remains insufficient for crop  production.  Since 2003, household water harvesting schemes have been expanding as an integral part of the Tigray regional food security and extension programmes, aimed at breaking the cycle of famine.  About 30,000 ponds have been built so far, with more than 200,000 planned over the next couple of years in the more drought prone areas of  Tigray.  The study draws on data collected from 650 households within thirteen tabias (villages).  The tabias were selected on the basis of i) differences in agro-ecology (lowland, middle altitude and highland);  ii) presence of ponds and water wells;  iii) distance to market and iv) the availability of baseline information.  N o . 1 4  J a n u a r y  2 0 0 7  3 P R E M  P O L I C Y  B R I E F  N o . 1 4  J a n u a r y  2 0 0 7  welfare for households with and without access to ponds or wells were compared. Additionally, a simple cost-benefit analysis of the construction and maintenance of ponds and wells was carried out.  This helps us to calculate how financially viable ponds and wells are for households in Tigray.     Key findings  1. There are no significant effects on household welfare from owning a pond or a well.  The results show that there is no statistically significant difference in welfare standing between households with and without access to ponds and wells.  Although this study does not fully explore the reasons behind these unexpected results, ponds and wells are currently not being exploited to their fullest potential.  On the one hand, access to ponds and wells is still limited for many households, and on the other hand, there may also be a period of acclimatization needed for households to learn how to harvest water efficiently.  As a result, there has been little impact on household poverty alleviation.    2. However, the economic return of wells is far superior to that of ponds.  Three criteria were used to financially evaluate the benefits of water-harvesting (internal rate of return, net present value and benefit-cost ratio).  Basically, if the benefits are greater than the costs, then the project is worthwhile.  If they are less, then it isn’t.    Over a ten-year planning period with a crop value of 3 Birr per kg, both ponds and wells have positive economic returns judged by all three criteria (see Table 1).   Table 1: Cost and benefit analysis of ponds / wells  However, the economic return of wells is much greater than that of ponds.  Ponds face higher costs for construction and maintenance and lower revenues compared to wells. Wells store water longer than ponds do enabling farmers to grow crops (usually high value crops) during the dry season. Ponds are promoted and used primarily for supplementary irrigation.  We also calculated the benefits of water harvesting over a five year planning period and with a drop in crop value to 2 Birr per kg.  This is a realistic scenario since the planning horizon of poor farmers is short and prices of vegetables and fruits will fall with increases in production.  While the economic returns of wells are still positive, the returns for ponds are negative.  There are various factors besides the design and the quality of construction that contribute to the success or failure of ponds and wells.  These include the discount rate, planning horizon of the users, prices of products and costs of production.  Much has to go well, especially if ponds are to give economically attractive returns.  3. There are key household characteristics which determine poverty in Tigray.  This study also explores the factors that help to explain household poverty.  Poor households show one or more of the following characteristics: they are female-headed; have a higher number of dependents per productive family member consumer-worker ratio (i.e. more consumption per worker); have more female than male adult labourers; are located in mid- and lowland agro-ecologies and are further away from the nearest health centre.  Since highly variable rainfall makes agricultural production uncertain, this uncertainty is RevenueConstruction costMaintenance costProduction cost Input costOutput8.931 4.295 655 2.4502.977 14.674 2.182 524 2.301 269 6.048 WellsPondsNet benefit 1.798 10.847 Total cost 7.133 4.751 Amounts (Birr) in Net Present value with r = 10%4 P R E M  P O L I C Y  B R I E F  N o . 1 4  J a n u a r y  2 0 0 7  PREM: In brief  The Poverty Reduction and Environmental  Management (PREM) programme aims to deepen and broaden the exposure of economic researchers and policy advisors in Africa and Asia to the theory and methods of natural resource management and  environmental economics. It is anticipated that this will  encourage policy changes that address both poverty reduction and sustainable environmental management.   This policy brief is based on the PREM project 'Water-harvesting for poverty reduction and sustainable re-source use: Adaptation strategies to climatic change in Tigray region, Ethiopia'  By: Eyasu Yazawa, Girmay G/Samuel, Fitsum Hagos, Gideon Kruseman, Vincent Linderhof, Mekonen Yohan-nes, Afeworki Mulugeta &Zenebe Abreha  The views expressed herein are not necessarily those of PREM or its sponsors. The full paper is available online at:  www.prem-online.org    For further information about PREM, contact:  Pieter van Beukering  Institute for Environmental Studies (IVM)  Vrije Universiteit De Boelelaan 1087 1081HV Amsterdam The Netherlands Tel. +31(20)5989555/Fax. +31(20)5989553  beukering@ivm.vu.nl www.prem-online.org     -    www.vu.nl/ivm  also a key factor in determining household poverty.   In comparison, wealthier households have a higher number of adult male labourers than female labourers; own livestock such as oxen; tend to be male-headed households and are located in the highlands.  Solutions for policy makers   Since 2003, household water harvesting schemes have been expanding as an integral part of the Tigray regional food security and extension programmes, aimed at breaking the cycle of famine.  Currently, there are no significant effects on household welfare from owning a pond or a well.  The challenge for policy makers is twofold: Firstly, to implement strategies which help households to optimally utilise ponds and wells and secondly, to implement polices which target the determinants of household poverty in Tigray.  From our research we advise the following solutions: • The promotion of ponds at a large scale should be approached with caution as they may pose more cost than benefits to the households or the society at large. • Measures such as the promotion of household drip kits and crops with high returns and the use of shedding to reduce evaporation, should be introduced to increase the efficiency of water use and minimize water loss. • The creation of employment opportunities and special support programs for women could contribute to poverty alleviation. • Policy has to support livestock-poor households to have access to such assets, for instance through the implementation of credit programs. • The provision of social services such as health centres plays a critical role in human health, and hence, on poverty reduction. • The implementation of water harvesting structures has to be maintained or even strengthened in order to minimize the uncertainties posed by unreliable rainfall.     

English

https://research.vu.nl/files/2257852/199641.pdf

Small scale water harvesting in Northern Ethiopia: Can it alleviate household poverty?

Abstract

Similar works

Full text

Available Versions

NARCIS

DSpace at VU

VU Research Portal