Our work encompasses the economic valuation of ecosystem services, natural capital accounting, the assessment of environmental trade-offs in development decisions and the economic analysis of natural resource use.
Water is not simply a resource. In Southern Africa, it is a constraint on economic growth, on food security, on production and on the livelihoods of millions of people. The natural environment that sustains water systems, regulates climate, supports biodiversity and underpins agricultural productivity has its own economic value. This value is routinely underestimated or ignored in investment and policy decisions. Getting both the economic and environmental values right matters enormously.
StratEcon has been working at the intersection of economics, water and the environment for over two decades. We bring rigorous, independent analysis to some of the most complex and consequential natural resource questions on the continent, from water allocation and infrastructure investment to the economic valuation of ecosystem services and environmental trade-offs.
Water economics in South Africa and across sub-Saharan Africa involves far more than pricing and tariffs. It encompasses the economic value of water in competing uses: agricultural, industrial, municipal and environmental. Water Economics also assesses the consequences of scarcity and allocation decisions, and the financial analysis required to justify investment in water infrastructure.
StratEcon conducts water economics studies for government departments, development finance institutions and private sector clients. We are experienced in quantifying the value of water across sectors and geographies, assessing the economic implications of alternative allocation frameworks and providing the analytical foundation for infrastructure investment decisions. South Africa’s water challenges are well documented. The economic analysis required to address them needs to be equally robust.
Environmental economics asks a question that is both simple and difficult: what is the natural environment worth? Ecosystems provide services like clean water, flood regulation, carbon sequestration, soil productivity, biodiversity habitat. These services underpin economic activity but rarely appear on a balance sheet. Without credible economic valuation, these services are routinely discounted in investment appraisals, infrastructure decisions and development trade-offs, often with costly long-term consequences.
StratEcon applies environmental economics methodologies to quantify these values in terms that policymakers, funders and investors can use. Our work encompasses the economic valuation of ecosystem services, natural capital accounting, the assessment of environmental trade-offs in development decisions and the economic analysis of natural resource use. This is distinct from environmental impact assessment, which is a regulatory and technical process requiring a different skill set. Our contribution is the economic dimension: placing monetary values on environmental assets and losses, modelling the cost of environmental degradation and providing the analytical basis for decisions about how to manage, protect or compensate for impacts on natural systems.
StratEcon’s water and environment practice spans Southern Africa and East Africa, with a body of work that reflects both the depth and geographic range of our expertise.
We worked with GIZ on the Lesotho Value of Water project, a detailed economic study quantifying the value of water resources in a country where water is simultaneously a critical national asset and a major export commodity. Our work on the Algoa Water Catchments involved economic analysis of water resource management in one of South Africa’s most water-stressed regions, informing long-term investment and allocation decisions with significant consequences for the Eastern Cape economy.
We are currently engaged on the Sabaki Water Project in Kenya, a public-private partnership focused on water resource development in East Africa, reflecting StratEcon’s growing continental footprint and our ability to apply rigorous analysis across diverse regulatory and institutional environments.
Water and environmental economics require economists who understand both the technical complexity of natural resource systems and the institutional frameworks within which decisions about those systems are made. Quantifying the value of water or an ecosystem is not straightforward. It requires methodological rigour, an understanding of the specific context and the ability to translate abstract economic concepts into evidence that decision-makers can act on. StratEcon has spent over 20 years developing exactly that capability, across South Africa and beyond.
We work with development organisations, government departments, municipalities and private sector clients, and are accustomed to operating in environments where the economic stakes are high and the data environment is imperfect. That is a defining challenge of economic practice in Africa. It is one we are well equipped to meet.
StratEcon works with governments, development finance institutions and private sector clients on water project engagements across Africa and internationally. Contact us to arrange a no-obligation introductory discussion.