Peru water authority lagging in works to face El Niño

Peru is moving forward with preventive works in the face of the coastal El Niño weather phenomenon (FEN) although national water authority (ANA) is lagging behind in executing its budget.

Reconstruction authority ARCC – an agency created to mitigate the damage caused by El Niño in 2017 – has spent 76.4% of its 2023 budget, while ANA – which is responsible for regulating and managing water resources – has only used 21.4% of its assignment.

According to the transparency portal of the economy and finance ministry (MEF), ARCC has spent 3.20bn soles (US$834mn) of a total budget of 4.19bn soles, while ANA has spent 259mn soles of a total of 1.20bn soles.

El Niño is one of the biggest threats to the Peruvian economy in the short term. Its impact this year on fishing, agriculture and freight transportation, among others, coupled to other factors such as the political crisis, pushed down Peruvian 2023 GDP growth projections to one of the lowest in Latin America at 0.9% compared to a regional average of 1.9%, according to consultancy FocusEconomics.

Growth projections for 2024 are also expected to be progressively reduced if the risks associated with El Niño are not offset.

ANA

In mid-June, ANA received a transfer for 975mn soles for the cleaning and clearing of rivers and ravines in the event of possible heavy rains and the presence of a moderate and/or strong El Niño. Likewise, the agency was authorized to carry out works in ravines and acquire the necessary machinery and services.

Although the measure was positive in the face of how little Peru is prepared for extreme weather events, progress has been slow. Of the 1.20bn-sole budget, the assignment for special works due to El Niño amounts to 893mn soles for 2023. Of this amount, only 78mn have been spent, according to MEF’s transparency portal.

ARCC

Unlike ANA, ARCC has made progress in using its budget for this year but there is a certain disparity regarding the type of works. Those that show greater progress – more than 80% – are related to infrastructure such as schools and hospitals, but not necessarily preventive works.

According to MEF, six storm drainage projects have progressed by an average of 61.2% for investment of 890mn soles. On the other hand, projects linked to flood control (29) register progress ranging from 94.5% in Chincha, Ica region to a minimum of 12% in Lambayeque region.

The result is that certain regions are better prepared than others. It is considered urgent to accelerate preventive work for summer 2024 (until April). According to the commission that studies the climate phenomenon (Enfen), the probability of a highly intense coastal El Niño is currently 35%, while the probability of a moderate phenomenon is 51%.