Virtual water export and import in china’s foreign trade: A quantification using input-output tables of China from 2000 to 2012

Abstract

Import virtual water is an effective way to alleviate water shortage. Since China is a country that suffers severely from the lack of water resources, it is badly needed to research in virtual water export and import in China's foreign trade. This paper conducted thorough research on these issues and lucubrated on the detailed destinations and origins of China’s virtual water export and import using the input-output model. Moreover, the factors that affect China’s virtual water trade have also been studied in this paper. The results indicated that: (1) from 2000 to 2012, the volume of virtual water export increased from 65.2 billion tons to 114.1 billion tons, and its import volume increased from 62.4 billion tons to 108.7 billion tons. China was a net exporter of virtual water; (2) the export of virtual water was mainly exported by sectors such as Textile &Garment and Leather Products, General Machinery and Equipment Manufacturing Industry, the import of virtual water was mainly imported by Agriculture, Petrochemical industry; (3) China has net exported large amounts of virtual water to developed areas such as the US, the European Union, and Japan, and has net imported from emerging economies and resource-oriented regions such as Taiwan (China), ASEAN, Brazil, Korea, Australia and Russia. Based on these conclusions, this paper proposed that China’s foreign trade structure needed to be adjusted to relieve the water shortage by the following methods the first is appropriately lower the export proportion of products from sectors such as Food, Beverage & Tobacco Products, Petrochemical Industry, which exported a large proportion of virtual water; the second is to enlarge the export proportion of products with low water consumption, such as service industry; the third is to make full use of the water saving effect of import.