China's water pricing urged to hold water
(Xinhua)
Updated: 2006-11-18 15:55
Whisky is for drinking, water is for fighting over, as Mark Twain observed.
It is true. Having found itself more often on the losing side of the battle to
provide sufficient clean water to the vast and arid northern region, Chinese
government resorts to market-driven water pricing to cure its water shortage
headache.
The National Development and Reform Commission (NDRC) released
a new regulation on the supervision of water pricing on Nov. 13 to clarify what
can be included in the cost of water supply and what should not.
The
regulation suggested that the price of water should be based on the costs of
water supply, which comprise the costs of tapping the water resources, providing
the running water, constructing the pipes and treating the sewage.
In
addition, it imposed quotas on expenditure on office buildings, salary rises,
staff benefits and hospitality expenses, which were also included in the costs
of water, and could become uncontrollable if no specific limit was
imposed.
The regulation stipulated that the hospitality expenses should
not account for more than 5 percent of the annual net profit for companies whose
annual net profit is less than 15 million yuan (1.8 million U.S. dollars), and
for companies whose annual net profit is above 15 million yuan (1.8 million U.S.
dollars), the hospitality expenses should be limited within three percent of the
total.
For stuff salary of water suppliers, it cannot surpass the 1.2
times of amount of average salary of employees of other sectors, as the
regulation required.
"It is essential to work out a proper pricing
regulation to provide clear accounting standards for water suppliers," said Dr.
Li Yuanhua, deputy director of the Department of Rural Water Management of the
Ministry of Water Resources.
"This will make the price of water match its
real cost, remind the public that China suffers from constant water shortages
and cultivate awareness of water efficiency among all residents," he
said.
Although possessing the fourth-largest fresh water reserves in the
world, China, by virtue of its population, has the second-lowest per capita
water holdings in the world, averaging about 2,222 cubic meters of water per
person, a quarter of the world average.
The unequal distribution within
the country makes the situation far more serious: 42 percent of China's
population -- 538 million people --in the northern region have access to only 14
percent of the country's water, according to the United Nation's 2006 Human
Development Report released in China on Nov. 14 entitled Beyond scarcity: power,
poverty and the global water crisis.
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