Virtual Water Flows Embodied in International and Interprovincial Trade of Yellow River Basin: A Multiregional Input-Output Analysis

Abstract

With the imminent need of regional environmental protection and sustainable economic development, the concept of virtual water is widely used to solve the problem of regional water shortage. In this paper, nine provinces, namely Qinghai, Sichuan, Gansu, Ningxia, Inner Mongolia, Shaanxi, Shanxi, Henan, and Shandong in the Yellow River Basin (YRB), are taken as the research objects. Through the analysis of input-output tables of 30 provinces in China in 2012, the characteristics of virtual water trade in this region are estimated by using a multi-regional input-output (MRIO) model. The results show that: (1) The YRB had a net inflow of 17.387 billion m³ of virtual water in 2012. In interprovincial trade, other provinces outside the basin export 21.721 billion m³ of virtual water into the basin. In international trade, the basin exports 4334 million m³ of virtual water to the international market. (2) There are different virtual flow paths in the basin. Shanxi net inputs virtual water by interprovincial trade and international trade, while Gansu and Ningxia net output virtual water by interprovincial trade and international trade. The other six provinces all net output virtual water through international trade, and obtain the net input of virtual water from other provinces outside the basin. (3) From the industrial structure of the provinces in the basin, the provinces with a relatively developed economy, such as Shandong and Shanxi, mostly import virtual water in the agricultural sector, while relatively developing provinces, such as Gansu and Ningxia, mostly import virtual water in the industrial sector. In order to sustain the overall high-quality development of the YRB, we propose the virtual water trade method to quantify the net flow of virtual water in each province and suggest the compensation responsibility of the virtual water net inflow area, and the compensation need of the virtual water net outflow area, in order to achieve efficient water resources utilization.