The Establishment of Water Markets in Water Imported Areas of the East-Route of South-to-North Water Transfer Project

Abstract

It has been tested in practice that markets are more flexible and effective way to allocate scarcity resources, therefore, tradable water rights and effective water markets are needed to be introduced to solve the scarcity of water resources. South-to-North Water Transfer Project is the main engineering measure to relieve the serious water scarcity in Northern China, this paper, however, tries to use markets as another path to increase water efficient use in water imported areas of the East-Route. The main difficulties in establishing water markets in this area have been analyzed, such as the fuzzy defining of water right, the ineffective water management system, and the willingness of water users to buy or sell and the blank of the tradable water rights system; the initial water rights, the tradable water, the facilities, the framework, the transaction rules, the procedure and the supervision to establish water markets in water imported area has been presented. In sum, water resources has been transferred possibly from rich to scare by the means of interbasin water transfer project, water markets institutions allocate these water more efficiently through the path of permitting water users cashing out the water they saved and then encouraging the movement of water from lower valued uses to higher valued uses.