Is Water Too Cheap in China?

Posted by Ju Young Lee, Water Matters @ Columbia at 2:19 AM on May 27, 2009.

The Chinese capital of Beijing will raise water prices this year as an attempt to conserve its scarce water supply. Cheng Jing, the head of Beijing's water-resources bureau, announced on May 10th the city would raise water prices within the next two months. This price hike will be the fifth one since 2001 in a bid to promote conservation.

According to the latest United Nations water report, China lists among the countries with the highest groundwater uses in the world. It withdraws between 50 and 200 cubic kilometers annually. Beijing, the capital city, is facing water limits, heightened by its fast pace of industrialization, wasteful irrigation projects and pollution of the region's underground water tables. But Beijing is now under even more pressure to conserve its water supply due to the delay of a huge and ambitious south-north Water Transfer Project. The plan is to divert 1 billion cubic meters (264 U.S. gallons) of clean water each year from the Yangtze River. However, the project, expected to be completed next year (2010), is delayed until 2014. The reason for the delay is thought to be related to the redistribution of water and relocation of residents along the 1,400 km channel that will link Central China's Hubei province with Beijing, Tianjin and neighboring provinces. Following news of the delay, policymakers are drawing up plans to conserve water in Beijing, including the raising of water prices for domestic and commercial users. Other water-scarce cities, including Shanghai and Shenyang, have recently decided to put a higher price tag on clean water.

As many analysts in China have said, the days of cheap water are over, and this water price hike has been expected.   "  The current prices are not sustainable for a water-scarce city like Beijing," said Professor Wang Dangxian, a researcher with the China Institute of Water Resources and Hydropower Research. According to him,water costs Beijing residents only about one-fifth of the amount paid by residents of the world's other major cities. Wang Hao, Director of the China Institute of Water Resources and Hydropower Research, feels water prices in the capital should be at least three times higher than prices now: "The price does not reflect the current situation of the severe water shortage plaguing the country, leading to water wastage and pollution," Hu Siyi, Vice Minister of Water Resources, said. However, water pricing alone cannot be enough to solve all water scarcity problems in China. "Simply raising water price cannot solve the water shortage problem in the long run. The government should encourage innovation in water conservation, reuse and recycle," Ma Jun, Director of Beijing-based Institute of Public and Environmental Affairs, told China Daily.

Tagged as: china, water