Wa­ter from afar can’t quench thirst

China Daily (Canada) - - COMMENT -

Amid eu­pho­ria and fan­fare, wa­ter from the $40-bil­lion mid­dle-route of the gi­gan­tic South-North­Wa­ter Trans­fer Project is set to reach Beijing in a mat­ter of days. For the parched Chi­nese cap­i­tal, which is in the same league as Saudi Ara­bia in terms of per capita wa­ter avail­abil­ity, this event is worth more than cel­e­bra­tion.

Nev­er­the­less, the wa­ter trans­ferred from the south of the coun­try is far from ad­e­quate to make Beijing wa­ter­se­cure, let alone the vast arid ex­panses ofNorth China. China as a whole is a wa­ter-stressed coun­try, with per capita wa­ter re­sources of some 2,100 cu­bic me­ters which is less than one third of the global av­er­age. The dire state of wa­ter short­age is wors­ened by the mis­match of spa­tial and tem­po­ral dis­tri­bu­tion of wa­ter sources with the dis­tri­bu­tion of pop­u­la­tion and arable land.

North China is home to half the na­tion’s pop­u­la­tion and two-thirds of its farm­lands. How­ever, with only one-fifth of wa­ter sources, this re­gion hap­pens to be the most wa­ter-scarce re­gion in China, where wa­ter has be­come a ma­jor con­straint to so­cioe­co­nomic de­vel­op­ment. With cli­mate change be­com­ing more ev­i­dent, pre­cip­i­ta­tion pat­terns and dis­tri­bu­tion are an­tic­i­pated to be much more un­even and un­cer­tain with higher evap­o­ra­tion. Th­ese fac­tors will likely ag­gra­vate the ex­ist­ing crit­i­cal wa­ter scarcity in the North. The sit­u­a­tion has also been ex­ac­er­bated by degra­da­tion of eco-sys­tems from the over­ex­ploita­tion of wa­ter sources.

It is high time pol­i­cy­mak­ers rec­og­nized that in the con­text of de­clin­ing avail­able wa­ter sources as demon­strated in the past decades, par­tic­u­larly dur­ing con­sec­u­tive drought years, and from in­creased de­mand for wa­ter gen­er­ated by agri­cul­tural, in­dus­trial and ur­ban growth, sup­ply side ef­forts may have well reached their lim­its.

Un­for­tu­nately, de­mand side so­lu­tions have not re­ceived as much at­ten­tion as they de­serve. De­spite the glar­ing scarcity of wa­ter, its eco­nomic value has been grossly dis­counted in both agri­cul­tural and in­dus­trial pro­duc­tion. Owing to ir­ra­tional al­lo­ca­tion and low pric­ing, the big wa­ter users, agri­cul­ture and in­dus­tries, are not sen­si­tive to the value of wa­ter uti­lized, re­sult­ing in the out­ra­geous waste and low wa­ter pro­duc­tiv­ity.

In North China, ir­ri­gated agri­cul­ture still ac­counts for more than 60 per­cent of to­tal wa­ter use. With de­clin­ing wa­ter avail­abil­ity due to com­pet­ing uses, cou­pled with in­creas­ing cli­mate vari­abil­ity, ir­ri­gated agri­cul­ture faces enor­mous chal­lenges. Bar­ring sub­stan­tial im­prove­ments in wa­ter pro­duc­tiv­ity, cur­rent prac­tices of ir­ri­gated agri­cul­ture will no longer be vi­able.

The cause for the chronic waste and overuse of wa­ter lies in the fact that wa­ter for farm­ers is vir­tu­ally free. For ex­am­ple, the cost of ground­wa­ter use is just that of elec­tric­ity/ diesel for pump­ing. Farm­ers, as en­tre­pre­neur­ial as they are, have been driven by fi­nan­cial in­cen­tives to with­draw wa­ter up to the point where the mar­ginal re­turns of crop pro­duc­tion in­creases equal­ize the pump­ing costs. In re­al­ity, in most cases they go beyond that point (with no ad­di­tional in­come) as they are not sen­si­tive to wa­ter waste. The ad­di­tional gains in agri­cul­ture pro­duc­tion are far less than the eco­nomic cost of wa­ter used.

Even with­out chang­ing the sta­tus quo of wa­ter al­lo­ca­tion, sub­stan­tial wa­ter sav­ing po­ten­tial can be tapped in agri­cul­ture if only the farm­ers’ cur­rent wa­ter use rights can be rec­og­nized and traded like land use rights by ac­cord­ing a fair value to the ground­wa­ter that farm­ers are cur­rently en­ti­tled to use.

Once farm­ers re­al­ize their wa­ter rights can be read­ily trad­able, with mon­e­tary value above the ad­di­tional crops pro­duced, they will op­ti­mize their wa­ter con­sump­tion, com­bined with good agro­nomic prac­tices, to in­crease wa­ter pro­duc­tiv­ity. The gov­ern­ment can pi­lot this by pay­ing un­used wa­ter con­sump­tion quo­tas at the price equiv­a­lent to or above the in­cre­men­tal agri­cul­tural pro­duc­tion, but still sig­nif­i­cantly lower than the eco­nomic value of wa­ter. This will lay the ground­work for a na­tion­wide wa­ter right trad­ing plat­form, based on en­force­ment of a wa­ter con­sump­tion quota sys­tem at the basin and dif­fer­ent ad­min­is­tra­tive lev­els.

“Waste not, want not”. The value of wa­ter con­ser­va­tion should be fos­tered and re­in­forced by a host of eco­nomic and reg­u­la­tory reme­dies, such as siz­ing economies based on wa­ter avail­abil­ity, con­sump­tive wa­ter-use li­cens­ing, ra­tio­nal wa­ter pric­ing, gov­ern­ment pay­ment for wa­ter con­ser­va­tion and par­tic­i­pa­tory wa­ter gov­er­nance. Such “go-lo­cal” de­mand­side man­age­ment ap­proaches could go much fur­ther than thou­sands of miles of canals built or to be built in ad­dress­ing the wa­ter cri­sis in North China. “Wa­ter from afar can­not quench thirst at hand”, goes aptly one Chi­nese proverb. Liu Xueming is a se­nior economist with the Food and Agri­cul­ture Or­ga­ni­za­tion of the United Na­tions, and Li Xiaokai is a se­nior wa­ter re­source man­age­ment spe­cial­ist with the­World Bank.

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