Water woes intensify in China due to rapid urbanization

Water woes intensify in China due to rapid urbanization

Staff Reporter

2014-05-11

Water shortages in China have been exacerbated due to rapid urbanization and industrialization, with many new cities facing water crises.

“The reckless expansion of cities significantly boosts the usage of water, and water resources have also reduced sharply as well as this, there has been an increase in concerns about water quality,” said Wang Hao, a research fellow at the Chinese Academy of Engineering.

Shanghai-based China Business News has reported that consumption of water for industrial use had grown rapidly and that the water pollution problem is worsening. The twin problems exist in many areas, including Gansu and Inner Mongolia.

Gansu is the driest region in northwestern China and has seen the fastest pace of construction aimed at urbanization and industrial growth in western China.

An investigation by the Xinhua News Agency revealed the existence of a similar situation nationwide, where, following urbanization and industrialization in some places, companies have been forced to seek a water supply after their factories are already built.

The Zhengzhou Airport Comprehensive Economic Experimental Zone, which has been called the world’s largest production base for smartphones, has also been experiencing a water crisis since its establishment. The economic zone is set to be expanded to 100 square meters in area with its total population pegged to grow to 1.5 million by 2020. The Foxconn Technology Group has 260,000 employees based in the economic zone. The local water resources department stated that many companies had built their plants in the zone at a fast pace but had discovered the water supply problem only after the completion of construction.

Wang said that China’s urbanization was pegged at 51.3% at the end of 2011, which was the first time the figure had exceeded 50%.

During the 12th five-year plan, China’s gross domestic product grew at the pace of an average 7% a year. Population growth through urbanization and the expansion of the country’s economic scale resulted in the rapid growth of the economy and society, which had significantly stimulated demand for water.

The growing discharge of pollutants had also upped the pressure on the environment.

China’s demand for water was estimated at 400 billion cubic meters in 1980, which was mostly due to higher water use for agricultural purposes, according to data from the Ministry of Water Resources. In 2011, China’s demand for water stood at 610.7 billion cubic meters, owing to growing water use by households in cities and by industries.

Luo Jianhua, secretary-general at the China Environment Chamber of Commerce, stated that solving the water shortage problem is critical, and that the safety of drinking water in urban areas nationwide needs to be ensured. The protection of water sources also needs to be strengthened, along with the establishment of a complete system for monitoring the safety of water, he added.

 

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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