The limited success of formal water markets in the Segura River basin, Spain

ABSTRACTThe Segura basin in south-eastern Spain is one of the most water-scarce regions in Europe. Its water economy has characteristics that constitute very favourable conditions for water market activity, and there are significant trading opportunities. However, the traded volumes have been rather small even though most of the water market activity in continental Spain is concentrated there. This paper describes the few formal water market experiences in the Segura basin since water trading was legislated on and regulated in 1999. As a result of this analysis, some hypotheses are made regarding the causes of the limited operation of this economic instrument.