Environment

World Bank recommends reforms to address to water scarcity

The World Bank recently published a report recommending that China should “reform and strengthen its water resource management framework” to address water scarcity.

From the press release:

The reform should focus on clarifying the role of and relationships among the government, markets and society; improving the efficiency and effectiveness of water management institutions; enhancing the use of market-based instruments such as water rights, pricing and eco-compensation mechanisms; and strengthening water pollution control enforcement and pollution emergency preparedness.

Other highlights from the analysis:

• China needs to move from a traditional water management system with the government as the main decision-maker towards a modern approach to water governance that relies on (a) a sound legal framework, (b) effective institutional arrangements, (c) transparent decision making and information disclosure, and (d) active public participation. Improving water governance will require the government to reform existing laws and regulations, strengthen law enforcement, reform and unify the organizational framework for better decision making at the national level and greater local ownership and participation at the river basin level, and strengthen legal provisions for public information and participation.
• To allow greater scope for market-based approaches, China needs to establish clear property rights for water. Prerequisites include the development of basin-level water resource allocation plans that give first priority to ecological needs, the conversion of traditional water allocation entitlements into tradable water rights, and the strengthening of water administration by clarifying the conditions, procedures, rights and obligations of the state, communities, enterprises and individuals for the withdrawal, consumption, protection and transfer of water rights.
• To provide appropriate incentives for the adoption of water saving technologies and behaviors, water prices need to be allowed to rise to reflect its full scarcity value. The first step is for water and sewerage prices to at least cover the financial needs of the water supply and sewerage enterprises. The social impact of the price increases, especially those affecting the poor, can be addressed by implementing an increasing block tariff approach and other social protection measures for residential consumers.
• To enhance incentives for the protection of water sources, China needs to vigorously pilot market-oriented mechanisms for ecological compensation. Mechanisms such as the payments for ecological services approach will improve the effectiveness of ecological compensation and reduce the financial burden on the government of providing adequate incentives for protecting the upstream ecosystems that are essential for the long-term supply of good quality water.
• To control and solve China’s serious water pollution problem, the government has to use all available legal, institutional and policy instruments to mobilize the public and motivate polluting sectors to comply with applicable regulations. This will require a strengthening of the wastewater discharge permit system, more aggressive use of the litigation systems to protect the public interest, greater attention to the control of non-point pollution from agriculture, and better preparedness for water pollution disasters.

To download the report and learn more about China’s water scarcity, check out the World Bank’s analytical and advisory assistsance (AAA) program, established in 2005 to address the problem.

And please see my links page for more China-related reports.

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