1. Poverty and water in Andean basins Glenn Hyman1, Andrew Farrow2 and John Alexander Marín3 1, 2 International Center for Tropical Agriculture, CIAT and 3Colombian National University, Palmira. Introduction Poverty and water are perhaps the two most important issues on the international development agenda. Despite poverty reduction in many parts of Latin America, problems persist in the Andean region. Growing population and climate change exacerbate water problems, leading to unreliable water supplies and conflicts over water resources. These two issues should be assessed together given their importance in the region. However it remains unclear how the two issues are related. Are problems of water availability and productivity direct drivers of poverty? What is the strength of the relationship between water and poverty? Given the nature of water and poverty, what can that tell us about development interventions that could improve conditions? This research explores these questions in the context of watersheds in the Andean region. Methods Our methodological approach is structured around a multi-scale analysis (Figure 1). First, we review the literature and assess national-level data on poverty and water in the Andes. This review reveals the experience of past studies of the water-poverty relationship. Second, we analyze key water and poverty variables across the region at the municipality level. This work analyses relevant variables for 2,583 administrative units in Colombia, Ecuador, Peru and Bolivia. It contrasts Andean vs. non-Andean areas, upstream vs. downstream zones and areas with different water resources conditions across the four countries. The analysis employs ordinary regression and geographical weighted regression to identify the main drivers of poverty in the region. Finally, the study focuses on conditions in two watersheds – Jequetepeque in Peru and Ambato in Ecuador. We use Bayesian network analysis to examine water-poverty relationships at the household level. Results and Discussion Poverty and water issues in the Andes should be viewed in the context of some key trends and developments in the region. There is a general trend towards the urbanization of poverty due to the large rural-to-urban migration in the region. The ranks of the poor have swelled in increasingly overcrowded cities. Migrants leaving the countryside for the city or for other countries are sending back remittances to some extent, an important source of income in many rural areas. Trends towards increasing non-farm rural employment (NFRE) and income (NFRI) have important implications for water and poverty, providing a pathway towards in improved livelihoods for many. These changes are taking place in an environment of technological and infrastructural changes and the growth of information and communication technologies Figure 1. Conceptual framework for study Broad-scale patterns suggest that poverty is higher in the Andes compared to the coastal regions of Andean countries. Higher levels of poverty can be found in the dry Bolivian and Peruvian Andes compared to humid Ecuador and Colombia. Issues surrounding health, education, land pressure and land degradation exacerbate poverty. Dairy, high value crops (flowers, coffee, etc.), rural non-farm income and rural non-farm employment are poverty exit pathways. Our analysis of municipality-level water and poverty indicators shows that when all variables are taken together in an ordinary regression, there are few relationships between poverty and water. However, our geographically weighted regression showed that in some areas key relationships between water and poverty can be uncovered. For example in Ecuador drought appears to be a key poverty driver in the central part of the country. At the scale of individual watersheds, our results indicate indirect linkages between poverty and water. Activities that reduce poverty could create environmental problems related to water quality and quantity. There are important linkages between upstream and downstream water uses, suggesting a possible role for payment for environmental services to compensate upstream water conservation efforts. Irrigation can be an important intervention that could reduce poverty in many areas. One factor in common in the literature and in our Bayesian networks analysis is the importance of education in poverty outcomes in the Andean region. Problems of water availability and productivity do not appear to be direct drivers of poverty in the Andes. However, there is some evidence that they are indirectly related to poverty. Our results suggest some of these indirect relationships and their implications for developing interventions.