The Latin America and Caribbean region is water-abundant. It boasts some of the world’s largest rivers, lakes and aquifers, which yield more water per person than any other region in the planet. However, water is irregularly distributed in time and space due to climatic variability. While heavy rainfall takes place across the year in the Amazon rainforests, it barely ever rains in the Atacama Desert. Besides, the majority of the population is concentrated in cities. This generates strong asymmetries between water demands and water availability. Largely as a result, many freshwater ecosystems are endangered by a wide array of different pressures. Adaptation to climate change, universal access to water and sanitation services, pollution control and an integrated approach to transboundary water resources management are the main challenges ahead.

This chapter describes the current water resources situation in Peru, recent efforts to promote governance in water resources management and challenges the country faces in this area. The physical territory and the variability of water availability are described and water uses are discussed. Special emphasis is given to the extremely low water availability in some areas of the Pacific Basin, where population is the highest and surface water availability the lowest. Examples of the impact of economic growth on consumption habits are given. Use of water in different economic activities is described. Progress in the water footprint estimation of selected agricultural products is also presented. Agriculture is being studied in detail as it consumes 80% of the water resources of the nation and a few examples of 'cash per drop' are given. Groundwater resources are especially important in the Pacific Basin from the economic viewpoint and two representative cases are included. The change of the energy matrix is also affecting water uses, as ethanol (made of sugar cane) is incorporated into gasoline by law. Environmental and social issues are pointed out, and the degradation of large areas of land and the pollution of water resources at a large scale is discussed. It is concluded that a number of factors such as population growth, economic growth, change in the energy matrix, the lack of regulation enforcement, and a lack of planning have led to an increasing pressure on land and water resources. In some cases, damage to the environment and water resources might be irreversible. The background history and concepts under which the National Water Authority was created and the roles assigned to this institution are briefly described and discussed. This entity has an enormous challenge in securing one of the nation's most valuable resources: Water.