Is Water Too Cheap in China?

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.