Background of Our Work in Peru

About Peru

Peru has experienced high economic growth in the last decade, and the country has notably been one of the fastest growing economies in the Latin America and Caribbean region. However, the Peruvian economy has begun to slow down in recent years. The decrease is mainly a consequence of unfavorable external conditions, a decline of internal confidence in the economy, and a reduction of private investment in Peru.

Economic growth has led to an equally significant increase in per capita income and a reduction in the poverty rate by 36% in six years. Although rapid growth rates have taken place throughout the country, the highest rate of growth (6.6%) has happened in the arid coastal areas, where the largest cities are located. For example, the capital city of Lima – the second largest desert city in the world – is where about a third of the country’s population lives and much agricultural and mining activity takes place. Only 1.76% of Peruvian water resources is available in the coastal area, where more than 60% of the country’s population is concentrated. By contrast, the rainforest regions of the Amazon Basin have approximately 98% of the water resources, but are home to only 10% of the population.

The National Water Authority, part of the Ministry of Agriculture and Irrigation, has recently prepared important water resources planning documents such as the National Water Resources Plant and six river basin management plans, completed with the support of the World Bank and the Inter-American Development Bank. These documents identify potential supply gaps and other issues (e.g. water quality) and estimate investment needs for US$ 45.7 billion by 2035. It is clear that the government alone cannot raise this sum; innovative solutions and partnerships with the private sector are also needed.

Water Challenges

Peru is among the top 30 countries that suffer from chronic water stress and water scarcity. Although it has 159 river basins and an overall per capita availability of 68,321 m³ per person per year, these resources are very unevenly distributed throughout the country because of the uneven spatial distribution of water resources. The country is divided into three major drainage basins: the Pacific, the Atlantic basins, and Lake Titicaca.

Out of Peru’s total population of 30 million people, approximately 7.4 million live in rural areasAbout 2.7 million of them have no access to adequate drinking water, and about 6 million Peruvians do not have access to adequate sanitation facilities. Lima, the capital city home to approximately a third of the country’s population, is located in the Pacific basin and is characterized by an arid climate with very low rainfall (on average 9 mm annually). Lima is also affected by extreme water shortages especially during the dry season. This coastal area is semi-arid; rainfall is practically nonexistent, and the area depends for its water supply on some 53 rivers, half of which carry only seasonal flow.

Furthermore, there are untreated mining effluents, insufficient wastewater treatment, unrestrained dumping of municipal and industrial solid waste, and indiscriminate use of agrochemicals that further limit the availability of freshwater supply throughout the country. This has increased the over-exploitation of groundwater resources reserves.