Report on China Water Industry
21st century is called as “water’s century”. The severity and importance of water problems have become the consensus of all social circles day by day. Central and local government departments all promote the water problems in the important position, and water industry will become one of China fastest developing industries in the future.

2005 was another peak year for the system reform of China water enterprises, and system reform, merger and acquisition, and integration etc. surged in different areas of China. In 2005, with the country’s more and more clear trend of the system reform of city public utilities, most local governments issued related legalized policies, and government hold an open attitude to the marketization of municipal industry and strengthened encouraging and supporting marketization reform of water enterprises. State took the water price reform as one of the three price reforms. In the whole 2005, accumulated industrial output value of water production and supply industry was 57,171,890 thousand yuan, accumulated revenue of product sales was 54,141,151 thousand yuan, accumulated profit amounted to –32,827 thousand yuan..

In 2006, overall status of China water industry was good. In the whole 2006, accumulated industrial output value of water production and supply industry was 70,873,416 thousand yuan, accumulated revenue of product sales was 65,070,015 thousand yuan, accumulated profit amounted to 2291057 thousand yuan.

From January to May in 2007, accumulated industrial output value of water production and supply industry was 29,504,982 thousand yuan, accumulated revenue of product sales was 26,407,694 thousand yuan, accumulated profit amounted to 127,204 thousand yuan.

During the “11th Five Years”, it is estimated that China will invest more than 1 trillion yuan totally in water supply, wastewater treatment, reclaimed water reuse, drainage and water pollution control, etc. The next few years will be the period in which China urbanization develops rapidly. Save water, accelerate the processing of water pollution and promote water recycling in this period which will become the peak stage of water market investment. Concretely, during the “11th Five Years”, new increased investment in the construction and plan of China town wastewater treatment and reclamation and reuse facilities is more than 330 billion yuan; in the city construction and old city remolding, large quantities of old pipe networks updating and rainwater-sewage separation remaking of sewage pipe networks need more than 50 billion yuan investment; only the middle line and east line of south-to-north water transfer project need 320 billion yuan investment. Superadding the investment in water safety system, seawater desalination and corresponding water project construction, therefore, total investment needed in fact will surpass 1 trillion yuan.

In recent years, China’s reform of water marketization and water price makes the environment of investment in water industry and development more relaxing. At present stage, investment, merger and acquisition and regrouping in water industry roll on with full force, and some market-oriented water enterprises rise rapidly. The next 5-10 years will be the key period for China water industry reform and development.

 

Water Pollution Threatens China’s Harmonious Development

Living in North China's Shanxi Province, Liu Shengji and his family, have recently been haunted by the news that more than half of the rivers in their province were covered by "black slick."

"We feel increasingly insecure about the drinking water," said the 42-year-old resident in the provincial capital Taiyuan, while speaking of more river pollution in other parts of China, including the recent chemical leak into the Songhua River in Northeast China.

According to the latest monthly report released by Shanxi's environment watchdog, 58 of the 99 rivers in the province were seriously contaminated while only 9 rivers' qualities were up to Grade I or II of the national standard, accounting for less than one tenth of the total rivers.

The river pollution was not limited to Shanxi. In 2005, a string of water pollution incidence wrecked unprecedented havoc onvarious parts of China.

An official report released this year said that China's longestriver, the Yangtze, is being threatened by 28 billion tons of polluted water.

This year China's water pollution problem was underlined by huge chemical spills into the Songhua River, into which about 100 tons of cancer-caused benzene chemicals were spewed following an explosion at a chemical plant.

"Water is the origin of life and the core of the environment. Water safety is what constitutes people's basic living conditions,not a luxury," said Feng Guangzhi, president of China Irrigation Districts' Association.

The frequent water pollution incidence have made the Chinese, who are aspiring for harmonious development, feel threatened.

"The vicious cycle, including stained water sources, polluted drinking water and unclean food, is a vital issue affecting people's health and safety," said He Shaoling, vice engineer-in-chief of the China Institute of Water Resources and Hydropower Research.

Statistics show that many farmlands within the regions of the Yellow river have been irrigated with polluted water, bringing harm to residents' health estimated at 2.2 to 2.7 billion yuan (about 270 to 330 million US dollars) every year.
Water pollution has also resulted in enormous economic losses. The pollution in the Yellow River has increased the cost of water for industrial use and degraded product quality, resulting in a loss of 2.3 to 3.2 billion yuan (about 280 to 390 million US dollars); it has also wrecked havoc of 3.3 billion yuan (about 4 million US dollars) on agriculture. In all, the polluted Yellow River has caused an economic loss of 11.5 to 15.6 billion dollars (about 1.4 to 1.9 billion US dollars).

A report released by the World Bank said that water and air pollution have caused loss equivalent to 8 percent of China's annual GDP and environment pollution have made China's developmentcost 7 percent higher than the world average.

"Water pollution is not solely caused by nature, but is a jointresult of human nature, society and economic development," said MaZhong, deputy director of Environment College of China's People University.

Water pollution has also drawn high attention of senior leadersand central government.

Chinese President Hu Jintao has put the protection of water sources and the supply of clean water among the top priorities.

Vice Minister of State Environmental Protection Administration(SEPA) Zhang Lijun said that next 25 years will be a key period in curbing the deterioration of water quality while at the same time China's fast growing economy will also mount an unprecedented pressure on water protection.

Experts have also called for governments at various levels to make extra efforts to protect the environment and reasonably utilize resources during the course of building a harmonious society.

SEPA officials said that on basis of advanced technology and with the participation of the whole society, China will put forward a national strategy in a bid to prevent and treat the pollution of groundwater and protect water sources.