- Climate change and human intervention, including mining, are a big threat to water security in the region.
- Through its water fund, Fonag, Ecuador is facing these challenges in an innovative way.
- The secret to the fund’s success is that it is inclusive, engaging a wide spectrum of stakeholders to ensure the continued protection of the páramos.
It’s freezing cold. The wind whistles. A gentle drizzle falls from the sky, and the ground wheezes like a soaked sponge with every step. It is an inhospitable and at the same time fascinating place from which Ecuador’s capital, Quito, gets its water.
At 3,500 meters (11,500 feet) above sea level, in the páramos, the shrublands of the Andes, lies the origin of most of the country’s rivers — both those that flow into the Pacific Ocean and those that water the Amazon lowlands and finally flow into the Atlantic Ocean.
You have to look closely to discover the subtleties of an ecosystem resisting such extreme conditions. To find the beauty within the colorful mosses, whose tones range from rust red to light green, in the wrinkled bark of the paper tree, Polylepis spp., or the grass Calamagrostis intermedia, which looks like a huge cream-colored hedgehog.
“This ecosystem is extremely sensitive. It works like a giant sponge,” says biologist Carla Pérez in an interview. “Mosses and grasses all have an important function. They have to absorb the water and store it in the soil.” These storage chambers then release it slowly in small ponds, that turn into little streams, which become wild rivers and finally turn into huge, lazy streams in the Amazon lowlands.
The páramos are very different from glaciers, which in summer or under climate-induced warming suddenly release enormous volumes of water that can transform into life-threatening avalanches. They are a predictable water storage system. This is why the páramos are a strategic resource for Andean countries like Ecuador.
Ecosystem under threat
Around 12,000 square kilometers (4,600 square miles) of Ecuador are covered by páramos. In the greater Quito area alone, around 5 million people depend on the water collected in the páramos and, to a lesser extent, in the glaciers of the surrounding mountains. But the natural water reservoir is under threat. First by climate change, which means that pests and also crops are climbing ever higher due to rising temperatures.
Potatoes, for example, are already cultivated at up to 3,700 meters (12,100 feet). Another danger is the influence of humans. Pastures for cattle are a major problem because the hooves of the animals compress the soil, reducing its storage capacity. In addition, their excrement contaminates the water at the source.
Slash-and-burn land clearance also destroys the sensitive mosses and lichens that take years to recover from this, while roads and power lines cut the landscape. But the greatest threat is open-pit mining.
The Andes mountain range contains valuable minerals, from copper to silver, lithium to gold. Mining companies are not only interested in the mineral resources, but also in the availability of fresh water, necessary for mining operations. Companies covet the páramos because getting water from there for free is much better than the costly process of desalinizing seawater and pumping it up into the heights.
In neighboring Colombia, the Constitutional Court placed the páramos under protection in 2016 and forced the government to cancel drilling and mining licenses. Mountain villages now hold referendums in which mining is regularly rejected. But the neoliberal government is reluctant to acknowledge this. This has led to constant conflicts, legal disputes and militarization of affected regions.
Combining forces
Ecuador has taken a different path, one that combines forces rather than splitting them. In Ecuador, the páramos are also protected, but thanks to a sophisticated management model, the Fonag water fund, there is an army of advocates who all work together — from companies to farmers to state institutions. Everybody is aware of the importance of the páramos and benefits from their protection. Together, they form a massive front against mining companies.
In the past, Oswaldo Ayaje had little understanding of the effects of the shrublands. He lives in Oyacachi, a small, indigenous village at the foot of Cayambe-Coca National Park.
“Nothing grew in such a high altitude, not even potatoes, so the páramo had no special value for us,” he remembers. Only the cows found some grass there — but not very nutritious either.
Today, Ayaje no longer sends his cows to the mountain pastures, but breeds trout and is one of 20 park rangers. For his cows he cultivates nutrient-rich concentrated feed mixtures at lower altitudes. And all this is thanks to a collaboration with Fonag, the water fund of the city of Quito, for which biologist Pérez also works.
When water suddenly became scarce in Quito in the 1990s due to a persistent drought, environmentalists, entrepreneurs and far-sighted politicians forged an alliance, and in 2000 set up the world’s first water fund.
“This is a piggy bank into which everyone throws money,” Pablo Lloret says of the basic idea. Lloret is a former director of Fonag, now environmental director of Quito’s municipal water company, Emaps. “The state, the private sector and environmentalists, participate. This gives the water fund an inclusive and cooperative character,” Lloret says.
The shareholders contribute their respective expertise and monitor each other, which fosters transparency and efficiency. Partnerships with schools and universities provide the scientific basis and environmental education for future generations. Many universities have set up weather stations in the páramos and collect climate data for research. “We also benefit from this data. If, for example, rivers swell due to heavy rainfall, we can warn the people living downstream in time and arrange evacuations,” Pérez says.
There were six founding members in 2000: Quito’s water company, environmental NGO The Nature Conservancy, the Cerveceria Andina brewery, the municipal energy company, the Swiss Agency for Development and Cooperation, and beverage producer Tesalia. Each contributed $21,000. The fund uses the interest and 2% of Quito’s water charges to cover its current expenses and build up its reserves. The only purpose of Fonag is to protect the páramos.
“He gives nature a voice,” Lloret says — and above all, money.
Fonag’s model later inspired the Ecuadoran constitution of 2007, which for the first time granted rights to nature. In Lloret’s view, Fonag has several advantages: “It has a long-term horizon, is financially and politically independent, is led by experts with a clear purpose which shields it from political turmoil and economic crises that are very common in Latin America.”
In the region, Fonag has become a role model. From Brazil to Mexico, public servants and experts are lining up to emulate it. The Inter-American Development Bank (IDB) has also become a fan of the Fonag model, as it fits into its public-private-partnership scheme.
There are now 22 water funds in Latin America. But not all are as sophisticated and balanced as Ecuador’s Fonag. Sometimes private interests predominate, or the funds are more of a superficial marketing gag for companies. In other cases, they are underfinanced or not independent of politics, which makes them vulnerable to political interference and corruption.
Tesalia, the largest beverage producer in Ecuador, says it is pleased by the model. “For us, the Fonag is a strategic partner with expert knowledge and local roots at the same time,” says Maria Isabel Parra, head of public relations at Tesalia. “There we have experts who can implement protection programs together with the affected communities and work with citizens. Having a long-term perspective gives us as a company planning security, as we can assume that our sources will still be bubbling in ten years. We could never manage all this alone.”
A step forward in development of poor communities
The fund manages and protects the páramos and enlarges them by purchasing adjacent private land. It also creates new income opportunities for the surrounding communities, which are often very poor. One of the approximately 4,000 direct beneficiaries is Ayaje.
“As a park ranger, I make sure that none of the villagers burns down the páramo to plant crops or let their cows graze there, as this turns the ecosystem into a sandy desert,” he says. Few people in the community of Oyacachi infringe the rules these days, because destroying the páramo hurts them directly. “Many of us now have built trout farms with the help of Fonag to supply ourselves with protein. We need fresh water for the trouts, and this comes directly from the páramo,” Ayaje says.
Tourism is an important economic alternative for the communities.
“Quito is one hour away,” Pérez says. “This is ideal for school excursions and weekend trips and serves to sensitize city dwellers with guided tours in the páramos.”
There are now numerous signposted hiking trails in the parks around Quito. The capital’s inhabitants are increasingly discovering nature for recreation. Weekend tourism and handicrafts have thus become an important new source of income for Oyacachi.
To keep up with the expectations for a sustainable nature destination, the community of 700 inhabitants is building a sewage system together with Fonag — not very common in such remote mountain villages. “For us, there is a life before and after Fonag. The fund was a huge step forward in development,” says Oyacachi Mayor Mauricio Parión.
Nature conservation has paid off for the inhabitants of Oyacachi. This is important, because lasting success would not be possible without the support of the village community. And the earlier you learn to appreciate nature, the better, the employees of Fonag say.
They have therefore developed an educational program and teaching material for students that is not only informative but also great fun. At least, this seems to be the case at the primary school in Machachi. Teacher Guadalupe Bonifa is showing the fifth-graders a video about the páramo.
Afterward, each student has to take an object from a shoebox — miniature plants, photos and rubber animals — and then gather in front of a cardboard model of a páramo and explain whether their object belongs to the shrublands. The cows are sorted out, cars, mining companies and houses too, while llamas, grasses and birds find mercy in the eyes of the fifth-graders.
At the end of the day, they all shout together, “We are the guardians of the páramo!” Eleven-year-old Juana adds, “Without them, our fields would dry up and we and our animals would die of thirst.”
Banner image: Carla Pérez, biologist, collecting data from a weather station in the Paramos. Photo by Florian Kopp.
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