Socioeconomic Evaluation of Drought Effects. Main Principles and Application to Guadiana and Algarve Case Studies

Drought situations can have significant impacts, affecting large areas and imposing relevant restrictions on multiple economic activities. The severity of those impacts is, normally, assessed through meteorological, agricultural and/or hydrological indices or even through estimation of water deficits or reduction of production yields (for agriculture). However, those assessments usually do not represent the socioeconomic importance of the impacts and the results are not comparable for different types of impacts or distinct regions. In this context, the present work enunciates the main principles to be considered and a methodological approach for socioeconomic evaluation of drought effects, regarding the main supply and demand characteristics of a region (water sources and associated uses), and the hydrological interlinked effects of drought situations. Moreover it describes the methodology process application to Portuguese reality and existing data as the basis of drought’s severity assessment, focusing on two drought prone areas in Portugal: the Guadiana and the Ribeiras do Algarve river basin case studies. Regarding the main specificities of the referred case studies, the economic activities (and water dependent sectors) considered for this methodology were the agricultural and the urban water supply sectors. For each of those sectors, specific assessment procedures where developed in order to estimate the respective economic impacts caused by the drought situation in the area of analysis. A global assessment of the socioeconomic relevance of drought impacts in a region is ensured through comparison of the estimated total economic impacts to the region’s annual average of the Gross Domestic Product (GDP), that enabling the comparison of results for different regions of analysis. The methodology may be applicable to any region with common hydrological and water use data and was developed to be of support for drought management and application on a drought early warning system.