Background:  Parks and protected areas in Ecuador provide drinking water to more than 2,000,000 people, and 60% of hydroelectric power produced in the country comes from rivers flowing from protected areas.  However, the link between conservation of natural habitat and water resources is often lost.  Management objectives are in conflict, and investments to maintain water quantity and quality are scarce.  USAID helped to establish the Quito Water Fund (FONAG) in the late 1990’s as a public-private alliance that is supported by a portion of municipal water revenues and charged with safeguarding water supplies by protecting parks and adjacent watersheds. 

Objectives:  1) Assist local governments to improve watershed management, directly benefiting local and down-stream users; 2) Establish financial incentives to support long-term investment in watershed and biodiversity conservation; 3) Increase civil society and private sector participation in watershed management, especially through school education programs.

Activity description:     This new initiative will strengthen FONAG, support new education and conservation programs, and replicate FONAG’s sustainable model of watershed conservation in Azuay, Tungurahua, and Loja-Zamora.  Payments from water users (city-dwellers, power users, and farmers) will support conservation and environmental awareness.  The program will also promote sustainable natural resource use in rural areas by providing resources to improve the livelihoods of communities in upstream watersheds, improve productive activities and generate alternative employment. 

Major expected results through 2008: Approximately 65,650 hectares of watersheds will be under improved management, and about 1,850 people will receive increased economic benefits derived from sustainable watershed management and conservation.Our stories: Virginia Pilca, a woman leader living in the buffer zone of the Cayambe Coca Reserve, Cangahua, benefited from the productive component of the program.  Many families of Cangahua were requested to remove their cattle from unproductive and fragile high-elevation grasslands, home of the threatened spectacled bear.  Virginia and many others migrated to jobs in the flower industry in Cayambe, far from their children and families.  FONAG provided the families of Cangahua with local economic alternatives such as guinea pig raising enclosures and employed members of the community as park guards.  With these eco-productive opportunities, the families improved their food security, spent time with their children, and revitalized the indigenous culture.  The community park guards reduced the number of wild fires 80%, and virtually eliminated poaching of spectacled bears. 

Partners: Quito Water Fund (FONAG) Ministry of Environment Hydroelectric Companies Municipal Water Companies Private Sector  

Implementing partner: FONAG (Water Protection Fund) 

Project duration: Two years (2007-2009)  

Investment: $940.000 

Contact: Paola Zavala, USAID/Ecuador, Tel. (593-2) 398-5228, This e-mail address is being protected from spam bots, you need JavaScript enabled to view it