The evolution of water trust funds in ecuador

Abstract

In early 2000 the city of Quito, Ecuador, established the Water Protection Fund (FONAG) to provide sustainable financing for the management and conservation of surrounding watersheds. FONAG was innovative in that it pioneered the use of trust funds in a voluntary, decentralized mechanism for financing watershed conservation. Since then, at least 15 similar water funds have been created or are under development in the Northern Andes, seven of which are in Ecuador. Ecuador's later water funds share many similarities with FONAG, but there are also important differences. This paper analyzes the evolution of Ecuador's water trust funds since the creation of FONAG and related changes in community-level watershed management. It does so by comparing the development and effects-todate of two of the most-recent Ecuadorian water funds: the Fund for Páramo Management and Fight Against Poverty in Tungurahua (FMPLPT) and the Regional Water Fund (FORAGUA). After defining the water trust fund model, the paper provides an overview of the FMPLPT and FORAGUA. It then compares these newer funds with FONAG to identify several trends in the financing of watershed conservation within Ecuador. © 2012 WIT Press.