Building up a governance mechanism (2000-NOW)

In this stage, China‘s water resource management has increasingly become more integrated after a series of policy reforms and institutional restructuring. One example is the revised Water Law of 2002, which aims to extend the Ministry of Water Resources‘ (MWR) powers and to change the status quo. The government began to take a more holistic attitude toward water management by trying to achieve a balance between economic growth and preservation of the environment. According to the Water Act 2002, the power of water management in China is shared by the MWR and local (provincial level) governments. The Ministry is responsible for overall water management across the country; seven large river/lake Basin Commissions (six river basin management commissions, and the Tai Lake Basin Management Agency) are responsible for the daily administration of water management within their scope of power delegated by the MWR (figure 1). As a result of this legal reform, the power of water management has been increasingly centralized in the hands of the MRW (Peng, 2010). Moreover, much more power now was given to River Basin Management Commissions (RBMCs), which were responsible for preparing basin-wide water allocation plans and providing technical direction and guidance to local governments within the basin.

However, given these above amendments, the real operation of the system in recent years still had the features of ministerial fragmentation and friction. It was because there were many ministries that were related to water management, such as agriculture, energy, forest, etc., MWR did not have the power to do the final decision.

Vertically, local provincial states still regarded economic development as their priority, they did not have the incentive to collaborate with MWR to control water usage and the MWR did not have coercive power to force them to abide by the instructions

representatives from the affected provinces and municipalities, they had difficulty to coordinate with related provinces/municipalities and other stakeholders (Rong, 2011:

26). For example, the Yellow River Basin Commission oversaw the allocation of withdrawal quotas among provinces, but it had no power to prevent a province from withdrawing water exceeding its allocation quota.

Figure 1. Chinese Water Management System

Source: Peng, 2012

In order to amend the above administrative fragmentation problems, the Chinese central state intended to build a better and sound governance system to be more effectively allocating water resources in ?? year. The system includes features such as:

to establish a new water right regime in order to build a more rational water price mechanism as to facilitate efficient water usage; to establish a more effective cross-boundary collaboration system in order to coordinate stakeholders along river basin, including resettlement issues. Many of the above ideas have been implemented

into experiments in some areas. The SNWTP was a big hydraulic project that the Chinese state wanted to do experiment as to create a new water governance system, as will be shown in the SNWTP case.

4. The “South-to-North Water Transfer Project”

The SNWTP is a vast and unprecedented water project in human‘s history and costs as high as nearly $100 billion (USD). The SNWTP was first proposed by Mao Zedong in the early 1950s, Mao said: “The South has more water than the North, if possible, it would be a good idea to borrow some water from the South to the North.”

Therefore, since 1953, the Yangtze River Water Resources Commission and the authorities began a comprehensive study of the SNWTP. After five years of research, the MWR proposed three water diversion routes: The Western Route diverted water from upper Yangtze tributaries in difficult and remote terrain in the Sichuan and Qinghai mountains. This project has been suspended due to serious debates and concerns about environmental damage. The Middle Route started at Danjiangkou reservoir on the Han, a major left-bank tributary of the middle Yangtze to reach Tianjin and Beijing in the north. The Danjiangkou dam was built in the 1960s that had 162 m height, it was planned to be raised up to 176.6 m height in order to increase its storage capacity. This route was planned to start to provide clean water to the north before the Beijign Olimpic Game in 2008, however it was not able to accomplish this mission and now was suspended to October of 2014. The Eastern Route takes water from the Yangtze about 100 km south of Nanjing and 250 km westward from the sea, by using the existing Grand Canal and some parallel riverbeds. This physical construction of this route has been completed and will begin transferring water to the north in the end of 2013. China formerly launched the mega-project in December 2002 and set up the SNWTP Construction Committee directly under the State Council in August 2003. Details of the three routes are shown in figure2, and table 1:

Figure 2. South-to-North Water Transfer Project

Sourece: The New York Times, 2007

Table 1: The Comparison among the Three Routes of China’s South-to-North Water

Eastern Route Central Route Western Route Water transfer capacity

(billion m3) 14.8 13 17

Length of diversion

canal (km) 1,156 (main canal) plus

740 (branch line) 1,241 (main canal) plus 142 (branch line)

Water transfer method Pumping stations Flow by gravity both Construction schedule Started in 2002; Water

was expected to begin

Water flowing areas Jiangsu, Anhui, Shandong, Major challenges Poor water quality

Ecological impacts of

Source: Adapted from Zhang (2009) and Rong (2011)

For the purpose of this paper, we will mainly discuss the central route that starts

from Danjingkou reservoir to Beijing in the north. The total length of this route is 1230 km, with a branch to Tianjin, and the water will supply mainly to 22 cities along the waterways of three provinces. Natural channels were rejected in favor of a new canal to preserve water quality and command the full area by gravity. The first stage will divert 9.5 to 13 billion cubic meter/yr of water or 25 -35% from Han River flows at Danjiangkou, though the new heightened dam will also have important flood and water control benefits for the downstream Han River areas and to the city of Wuhan (Peng, 2012). Although the central route is designed to meet the need of the north in general, nonetheless, the final destination of this route is the most important one--- to feed the capital city, Beijing. In the first stage, Beijing is expected to receive 1 to 1.2 billion, whereas Henan province is 3.5 billion, Hebei is 3.3 billion, and Tianjin is 1 billion cubic meter of water.

5. Beijing and SNWTP

Beijing,located innorthern China, has been the political center of China for much of the past seven centuries and is currently the capital of China. It is one of the mostpopulous cities in the world with the size of population in 2012 was over twenty million. Located in dry northern China, Beijing has two major rivers flowing through the municipality, the Yongding River and the Chaobai River, and flow in a southerly direction. Historically, these rivers were the sources of major water supply to the city.

After the revolution, the central state built up Guanting and Miyung reservoirs to provide water to Beijing and adjacent areas in Hebei province. As Beijing continued to expand its size, these two reservoirs recently supplied water only to Beijing.

At the same time, the Beijing municipal government used every possible measure to increase water supply and to reduce water consumption. Since the 1990s, the city has been implanting an industrial structural adjustment project that moved heavy industries out of the city and promoted instead those high tech industries. To avoid overuse of water, Beijing Municipal Government also adjusted water prices many times (Banchongphanitha et al, 2008). In addition, the city Government also tried other measures, such as persuade people to change their habits on water use, promote the use of recycled water by building more sewage treatment plants, in order to achieve water conservation.

Table 2. Water Resource in Beijing (2001-2008)

(Unit: One hundred million cubic meter) Water

Source: Beijing Statistic Bureau, 2010

Through those efforts, Beijing’s consumption of water has largely decreased (table 2, 3), in which the use of ground water has been largely reduced whereas the consumption of recycled water has increased rapidly. In addition, now the domestic usage of water becomes the largest share of water supply, replacing agricultural irrigation and industrial uses.

However, due to the increase of population, it still suffered from serious water shortage problem. Beijing constantly is in thirsty condition. In the past decade, the shortage in some years reached as high as 2 billion cubic meter (table 3). Transferring water from the south to meet the demand of Beijing, especially for the drinking water, is a policy that the central state has to adopt. The new project creates tensions among regions and cities that call for the central state to step in to solve the conflicting water supply problem.

Table 3. Water Consumption in Beijing

(Unit: One hundred million cubic meter) Water

Consumption (One billion cubic meter) Water

Resource Water

Water

Consumption (One billion cubic meter) Water

Resource Water

The SNWTP is a water transfer project, which intends to transfer not only water but also clean water to the north, which necessarily affects the economy of the provinces located in the water supply area, including Henan, Hubei and Shaanxi provinces. Some of the most salient ones were:

First, the expansion of the Danjiangkou Reservoir would flood even more farmland and evacuate tens of thousands of farmers from their homeland. According to the plan, Henan and Hubei provinces have to move out a total of 330,000 people.

Most of them are farmers, and most of these farmers have to migrate to the neighboring counties. Although these farmers in the relocation process can be partially compensated (each person can get RMB $600 per year for 20 years)(Ching, 2010), and can be assigned to a small piece of farmland in the new residential areas, but they have lost local connections and have difficulty to find job in the new cities, not to mention that the resettlement costs are far more than that local governments could have afforded (Lu, 2010).

Second, local governments along the cannel of the SNWTP areas also have been severely affected in terms of economic development. It is because of the SNWTP that the local government on the one hand has lost a lot of farm land to develop local agriculture, and on the other hand is forbidden to promote industrial development which may cause water contamination. As a result of both factors, the fiscal revenue of those affected local governments are becoming worsened (Yang, 2010).

Third, similar damages on economic development have affected the local governments that located around the dam areas. Danjiangkou reservoir is so big that has 4,700 km in circumference, which covers parts of three provinces of Hubei, Henan, and Shanxi. Many local states in those areas use water resource as sites to develop tourist or other industries that have resulted in the deterioration of water quality of the reservoir. In other words, reservoir has been the source of their

economic development (Wu, 2009). As the date of water transfer is approaching, it is obvious that these industries have to be shut down.

Local vs local

In fact, the affected provincial governments, such as Henan and Hubei, already complained that the project has cost too much for their own provinces, because the project places too much financial burden on environmental protection at the expenses of local economic development. Especially that the closure of polluting enterprises already reduced local governments’ fiscal income and those laid-off workers also caused social problems.

In addition, for the relocation of affected rural migrants, although the costs will be paid by “Central Line Water Transfer Company“, local governments still have to pay the administrative expenses. Therefore, the local governments in water-supply area always ask more financial subsidies from the company. According to local immigration authorities, an immigrant’ relocation probably needs to spend RMB

$70,000, including resettlement housing, infrastructure and transportation. Although the central state (the company) has transferred monetary payments each year to local governments, the latter still faced the double increase of administrative expenditure and reduction of income. In the four related provinces, Hubei and Henan especially hope to get more financial subsidies and compensation that creates tension between Beijing and those provinces.