The interdisciplinary nature of the water resources management issue requires an explicit integration of economic, technical, environmental, institutional, social, and legal aspects in a coherent analytical structure. The need for an integrated management within a homogeneous spatial framework is even more compelling in the arid and semi-arid regions where water resources represent a vital factor for sustainable economic development.

The SASS region is one of the most illustrative examples of these regions where water resources play a vital and paramount role. In fact, the continuous increase of water demand in the SASS regions has had a negative effect on the aquifer’s sustainability. In such situation and in order to address the existing difficulties and challenges in the SASS region, it was deemed necessary to opt and struggle for the promotion of an integrated management of the rare and valuable water resources within an appropriate spatial framework.

The Hydro-economic model of the socio-economic component of the SASS III project comes to respond to this objective. The hydro-economic modelling, which serves to enable the quantitative analysis and evaluation of the impacts of human actions on the aquifer, provides decision-makers with an appropriate tool to help them conceive and especially implement coherent and feasible economic policies.  In addition, the hydro-economic modelling offer them (decision-makers) the means to discuss with people in charge of other economic sectors on an encrypted and adequately quantitative basic.

One of the main objectives of the socio-economic component is to develop an integrated hydro-economic model which takes into account all the relations and interactions among key variables and determinants of water demand and especially water productivity. The water demand determinants include:

• the choice of agriculture by farmers;
• the Combination of inputs required for production with a focus on scarce resources, namely water resources and especially its mobilisation cost;
• the positive impacts of the aquifer’s usage on the economic well-being of the region translated in more production;
• the negative impacts of withdrawals on the aquifer’s sustainability.

The report dedicated to the hydro-economic model is made up of three sections:

• the first section is a brief overview of the plentiful literature devoted to hydro-economic modelling and application in a context similar the general context of the SASS region;
• the second section concerns the elaboration of a hydro-economic model of the SASS region. The conception of the hydro-economic model will be inspired from the monitoring approach adopted and developed by the contributions in terms of socio-economic modelling produced throughout decades (synthesized in section 1). The first step concerns the conception of the model’s basic structure and before proceeding to the elaboration of the development scenarios and select the one that is more likely to maximize the well-being of the entire farmers community in the SASS region while fully respecting the model’s feasibility and especially the aquifer’s sustainability. The last step concerns the proposition of an explicit formulation of the selected model to prepare the ground for its effective application thanks to the actual statistic data available;
• the last section will present the data necessary for the application of the hydro-economic model to the real context of the SASS region. Three data categories were devised and set to make the elaborated model operational and provide the encrypted projected evaluations. The first category is relative to global data that would be collected at the different bodies and services in the concerned countries. The second will include microeconomic data thanks to the socio-economic surveys conducted within the present project. The final category concerns certain results obtained at the quantitative analysis( carried out and presented in details in previous reports).