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Addressing China's growing water shortages and associated social and environmental consequences

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  • Shalizi, Zmarak
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    Abstract

    China has experienced a wide-scale and rapid transformation from an agricultural based economy to the manufacturing workshop of the world. The associated relocation of the population from relatively low density rural areas to very high density urban areas is having a significant impact on the quantity and quality of water available as inputs into the production and consumption process, as well as the ability of the water system to absorb and neutralize the waste byproducts deposited into it. Water shortages are most severe in the north of the country, where surface water diversion is excessive and groundwater is being depleted. In addition, the quality of water is deteriorating because of pollution, thereby aggravating existing water shortages. The biggest challenge ahead will be for national and local governments to craft policies and rules within China's complex cultural and legal administrative system that provide incentives for users to increase efficiency of water use, and for polluters to clean up the water they use and return clean water to stream flows. Using a standard public economics framework, water requirements for public goods-such as ecosystem needs-should be set aside first, before allocating property rights in water (to enable water markets to functionand generate efficient allocation signals). Even then, water markets will have to be regulated to ensure public goods, such as public health, are not compromised. Until water markets are implemented, staying the course on increasing water and wastewater prices administratively and encouraging water conservation are necessary to reduce the wasting of current scarce water resources, as well as the new water supplies to be provided in the future.

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    Bibliographic Info

    Paper provided by The World Bank in its series Policy Research Working Paper Series with number 3895.

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    Date of creation: 01 Apr 2006
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    Handle: RePEc:wbk:wbrwps:3895

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    Keywords: Water Supply and Sanitation Governance and Institutions; Town Water Supply and Sanitation; Water and Industry; Water Conservation; Water Use;

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    1. Shahid Yusuf & Kaoru Nabeshima, 2006. "China's Development Priorities," World Bank Publications, The World Bank, number 7049, October.
    2. Anderson, Kym & Huang, Jikun & Ianchovichina, Elena, 2003. "Long-run impacts of China's WTO accession on farm-nonfarm income inequality and rural poverty," Policy Research Working Paper Series 3052, The World Bank.
    3. Ravallion, Martin & Chen, Shaohua, 2007. "China's (uneven) progress against poverty," Journal of Development Economics, Elsevier, vol. 82(1), pages 1-42, January.
    4. World Bank, 2002. "Agenda for Water Sector Strategy for North China : Summary Report," World Bank Other Operational Studies 15418, The World Bank.
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    Cited by:
    1. Woo, Chi-Keung & Wong, Wing-Keung & Horowitz, Ira & Chan, Hing-Lin, 2012. "Managing a scarce resource in a growing Asian economy: Water usage in Hong Kong," Journal of Asian Economics, Elsevier, vol. 23(4), pages 374-382.
    2. Zhang, Lei & Zhu, Xueqin & Heerink, Nico & Shi, Xiaoping, 2014. "Does output market development affect irrigation water institutions? Insights from a case study in northern China," Agricultural Water Management, Elsevier, vol. 131(C), pages 70-78.
    3. Jian Xie, 2009. "Addressing China's Water Scarcity : Recommendations for Selected Water Resource Management Issues," World Bank Publications, The World Bank, number 2585, October.

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