n will be in the best long-term interests of the communities which use the resources.
Available evidence suggests that previous investments in drainage in the Banados have not been based upon such careful analysis and have led to substantial socio-economic and economic costs. For example, by improving the drainage capacity of the Andreoni Canal in 1978, discharge of fresh water was increased along the Coronilla beach. This change in salinity is thought to have reduced the productivity of the offshore fishery and income from the associated artisanal and sport fishing activities.
Similarly, debris carried down by the canal littered the beach, dissuading bathers and triggering a substantial decline in the number of tourists and in the income of hotels and other tourist facilities in the area.
The loss of the wetlands and the associated fauna has led to a reduction in the exploitation of Coypu and to a decline in the importance of this source of income to the local communities. Also, certain of the water management works have led to an increase in flooding at certain times of year, rather than to a decrease. This increase in flooding has reduced the capacity of the wetlands to support the pastoral industry at certain times of year.
Not only has drainage yielded many costs, but the return on investment has in certain cases been lower than anticipated. For example, the India Muerta dam now irrigates only 4,000 of the 10,000 hectares that had been forecast (Vaz-Ferreira, 1987).
In the light of these observations, it is surprising that the 1986 loan from the InterAmerican Development Bank was preceded by an environmental impact assessment which detected no significant environmental impact that could destroy the renewable natural resources as a result of the project. This may have been a consequence of the short duration of the study, and it is therefore essential that, in future, environmental impact assessments are done in the most thorough manner possible. It is most likely that such studies, in order to be effective, will require to be undertaken over a period of at least one, and ideally two, complete annual cycles. Any study of shorter duration is likely to be superficial and of limited value in detecting the true environmental impact.
By definition, drainage in the Bañados will have an environmental impact. What needs to be determined is not what that impact is, but rather whether the true economic and social cost of that impact can be offset by the investment whose impact is being studied. To determine whether this is indeed the case, attention needs to be focused not only upon the environmental impact of drainage investment, but upon the precise sum required to carry out the drainage, the effectiveness of that drainage, the precise return upon that investment, the distribution of benefits from that investment to the communities which currently use the resources, and the net impact upon the national economy. Unfortunately, we were unable to obtain copies of the detailed proposals for the Bañados, and it is therefore not possible at this stage to say whether such detailed analyses have been carried out. However, it is clear that the full value of the wetland resources of the Bañados, and their interaction with the economic activities in the region, is considerable. We therefore believe that prior to any further investment in the Bañados, a detailed ecological and hydrological study of the resources should be carried out in order to determine the full range and full value of the functions which these wetlands provide. These functions will range from flood control to provision of water supply, fisheries support, and species conservation. The impact upon these functions, and the economic consequences of their loss as a result of drainage, should be assessed and this net loss to the economy should be compared with the net benefit as a result of the investment. In this context, specific consideration needs to be given not only to the yield in terms of rice production that would be generated but to the investments (fuel, infrast