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China is expected to allow foreign investors to pump money into
its water infrastructure to tackle shortages that could get
worse in future years.
The sector has previously been a State monopoly.
In Chengdu, capital of Southwest China's Sichuan Province, a
foreign-owned water project called Vivendi Waterworks will begin
supplying tap water in March 2002.
More foreign investors are expected to follow Vivendi, a move
which is being encouraged by the Chinese Government.
The government hopes they will invest in BOT (build, operate
and transfer) schemes, which mean a company builds and operates
projects and then transfers them to Chinese firms.
Similar foreign-funded projects are under way in Tianjin and
Beijing, which shows water treatment and supply are becoming
attractive to foreign investors.
Wang Yuqing, vice-minister of the State Environmental Protection
Administration, said yesterday the country badly needed advanced
water treatment technology, new management structures and more
capital.
Wang was briefed about the country's current policies at the
four-day Third China International Exhibition for Water Treatment
Technology & Equipment, or China Water 2000, which opened
yesterday in Beijing.
The Chinese Government will invest heavily to solve water supply
shortages and water pollution during its 10th Five-Year Plan
period (2001-05), said Han Deqian, vice-minister of science
and technology.
China has long had serious water shortages. There is only 2,400
cubic meters of water per person in the country, one fourth
the world's average level.
Low water prices and poor treatment facilities have aggravated
the problems.
"People in China think water is a natural resource which
needs not be paid for," said Karl Zhang, of France-based
Vivendi Water, one of the world's top companies in this field.
He believed the introduction of competition would promote more
efficient use of water and lead to cheaper and more effective
water treatment.
However, few BOT projects have so far been set up in China and
Zhang complained the former public service was difficult to
get in to.
Wang said Chinese local authorities had not fully recognized
the urgency of opening the water sector, which had for decades
been run by the government as a State monopoly.
Michael Smart, general manager of the Vivendi Chengdu Waterworks
Co Ltd said the project would give the company a good name not
just profits.
He said foreign capital in the water supply field could help
Chinese local governments solve their problems in this area.
"We will try various forms acceptable to the government
to develop our business in this promising market," he said.
(China Daily 08/10/2000)
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