Water Resour Manage (2009) 23:2655–2668
DOI 10.1007/s11269-009-9401-x
Water Scarcity and Water Use in Economic Systems
in Zhangye City, Northwestern China
Yong Wang · Hong-lang Xiao · Rui-fang Wang
Received: 8 December 2007 / Accepted: 14 January 2009 /
Published online: 10 February 2009
© Springer Science + Business Media B.V. 2009
Abstract Water has traditionally been considered a physically scarce resource in
Northwestern China, and most investigations of water scarcity focus on the finite
nature of water supplies. Based on the input–output analysis, this paper establishes
a number of indicators of water consumption to analyze the structural relationships
between economic activities and their physical relationships with the water resources.
These indicators allow us to calculate the level of total water consumed by each
sector and to distinguish between direct and indirect consumption, thus, offering
the possibility of tracing the source of indirect water consumption. By drawing on
the water consumption in Zhangye, a city situated in Northwestern China which is
characterized by water shortage, we have discussed how the “problem” of scarcity
has been constructed in this area. It is shown that the expanding agriculture and the
unsuitable trade structure of exports and imports are likely to be responsible for the
increasing scarcity of water in Zhangye. As a result, it seems that the problem of
water scarcity in Zhangye is not necessarily a given, but instead the results of poor
resource use, coordination and inadequate resource management.
Keywords Water scarcity · Input–output analysis · Water consumption ·
Virtual water
Y. Wang (B) · H.-l. Xiao
Heihe Key Laboratory of Ecohydrology and Integrated River Basin Science,
Cold and Arid Regions Environment and Engineering Research Institute,
Chinese Academy of Sciences, Lanzhou, 730000, China
e-mail: [email protected]
R.-f. Wang
Zoucheng Environmental Supervision and Protection Center, Jining, 273500, China
Y. Wang
320 Donggang West Road, Lanzhou 730000, People’s Republic of China
2656
Y. Wang et al.
1 Introduction
Over the past two decades, China has experienced an unprecedented economic
boom, with real GDP growing at an annual average rate of about 10%. Despite the
robust performance, the potential risks associated with water scarcity have brought
about an emerging challenge to the country’s economy and environment. This is
particularly true for the inland river basins in northwestern China that facing severe
water shortage. In these areas, annual rainfalls are low and water resources are
deficient. Rapid economic growth and expanding agriculture in resent years have
resulted in excessive use of their water resources, causing environmental degradation
and generating tensions in the eco-economic system. For example, the Ejina Oasis
downstream the Heihe River (the second-longest inland river in China) shrank from
6,940 km2 in the early 1960s to 3,328 km2 in the early 2000s because of the huge
consumption of the limited water resources in the middle reaches, and the area of
desert increased by 460 km2 during this period (Feng and Cheng 2001). Currently,
the Ejina Oasis has become a main source of dust for sandstorms in northwestern
China (Gao et al. 2003; Wang et al. 2008).
There are numbers of researches related to the water scarcity in the inland river
basins in northwestern China. Previous researches have shown that the main cause
of the scarcity was the limited water availability due to low rainfall (Gao and Shi
1992; Feng and Qu 1997; Qu et al. 1997). Indeed, for these areas, water is a limited
natural resource and water scarcity is emerging when the demand outstrips the lands
ability to provide the needed water. As a result, more recent studies tend to show
that the water scarcity is not only produced by natural causes, but also induced by
human activities. For example, Lu et al. (2003) examined the changes of landscape
structure and composition in the upstream of the Heihe River and found that the
forest and grass land had been being replaced by crop land due to growing population
in rural area. They pointed out that the degradation and land use conversion of
watersheds inevitably reduced the amount of water available downstream. Yang
et al. (2003), from an analysis of water availability, water demand and water price,
concluded that man-made dry regimes were now adding to the natural water scarce
conditions, in many cases aggravating the existing situation. Qi and Luo (2005)
indicated that cases of downstream users receiving polluted water from middle
reaches had increased dramatically due to a large increase in agricultural fertilizer
and pesticide use in the past decades. Ji et al. (2006) studied the water supply and
demand in the middle reaches of the Heihe River and found that the groundwater
level had been steadily decreasing due to over pumping and decrease in recharges.
Moreover, while there is some acknowledgement of the differences between water
shortage (levels of available water do not meet certain minimum requirements) and
water scarcity (a “social construct” that determined both by the availability of water
and by consumption patterns), largely most of the researches focused on volumetric
and physical measures, especially with respect to both a growing population and
competing demands for water (Yang and Zehnder 2001; Xu and Long 2004; Li et al.
2005; Xiao and Cheng 2006; Fang et al. 2007; Cai 2008). In addition, none of the
existing researches have investigated the socio-economic processes of water use that
have led to the creation of water scarcity in these areas till now.
Based on the input–output analysis, we established a number of indicators of water
consumption and applied them to Zhangye, middle reach of the Heihe River, to
Water Scarcity and Water Use in Economic Systems in Zhangye City
2657
analyze the structural relationships between economic activities and their physical
relationships with the region’s water resources. The objectives of this paper are to
examine how a “problematic” agriculture has exacerbated scarcity conditions and
how the “problem” of scarcity has been constructed.
The rest of the paper is organized as follows: the study area, data and methods
employed are introduced first. Then, the results are reported. Lastly, there is a
discussion of the findings and a brief conclusion.
2 Materials and Methods
2.1 Study Area
The Zhangye City, located in the middle reaches of the Heihe River (Fig. 1), is
42,000 km2 in size and has a population of 1.264 million, including a rural population of 911,000 and an urban population of 353,000. The climate of this region is
arid, with annual precipitation ranging from 100 to 300 mm, and potential annual
evapotranspiration reaching 2,000 mm.
Although located in one of the driest zones in the world, Zhangye consists of many
oasis ecosystems that are mainly watered by the Heihe River. Water use in this city
accounts for about 93% of all water use from the river, with 94% of this water used
for agriculture. According to the Zhangye Statistical Yearbook, the irrigated area
in Zhangye was about 68,667 ha in the 1950s, but by 2002, had expanded to almost
266,000 ha, including 212,000 ha of farmland and 41,000 ha of forest and grassland.
Based on irrigated farming, Zhangye has become an important center of Gansu
Province for the production of commodity grains.
Since the Chinese national economic reforms that began in 1978, new industrial
sectors have arisen, such as mining (including coal production), production of building materials, electric power, metallurgy, machinery assembly, transportation, and
services. In recent years, Zhangye has experienced considerable economic growth
as a result of these changes. The gross domestic product (GDP) was $837.3 million
in 2001, which was 8% greater than that in 2000. In 2002, 2003, and 2004, the GDP
increased to 916.8, 1013.1, and 1206.7 million US$, respectively, representing annual
increases of 10%, 11%, and 12%, respectively, over the values in the previous year
(GSB 2001–2005).
Expanding agriculture and rapid economic growth have resulted in excessive
use of the region’s water resources. According to GPBWR (2003), in 2002, the
annual available water resources were 2.05 billion cubic meters, including 1.63
billion cubic meters surface water and 0.42 billion cubic meters groundwater,
while the actual annual water utilizations were 2.42 billion cubic meters, of which
90% was consumed by the socio-economic systems, and of this amount, 96% was
used for agriculture (Table 1). Ecological and environmental water demands are
severely restricted for the excessive water use in socio-economic systems. As a
result, the city seems to have locked into an environmental-economic dilemma
through increasing dependency on the scarce water resources and further erosion of
environmental quality.
2658
Y. Wang et al.
Fig. 1 Location of Zhangye
and the Heihe River Basin
N
Juyanhai
He
ihe
Riv
e
Ejina Oasis
Jiayuguan
Jiuquan
Zhangye
Qil
ia
nM
ou
nta
ins
50Km
0
50Km
2.2 Methodology
2.2.1 Input–output Analysis
The input–output analysis is a top–down economic technique that uses sectoral monetary transactions data to account for the complex interdependencies of industries
in modern economies (Lenzen 2003). Formally, for an economy of n sectors the
standard input–output model is represented by the following expression:
x = (I − A)−1 y
(1)
Table 1 The situation of water use in Zhangye City, 2002 (106 m3 )
Sources
Surface water
Groundwater
Sum
Production use
Agricultural
sectors
Industrial
sectors
Service
sectors
1,885.6
213.5
2,099.1
12.2
24.7
36.9
1.4
3.0
4.3
Household use
Ecological use
Sum
32.5
11.6
44.1
72.0
168.0
240.0
2,003.8
420.8
2,424.5
Source: The Gansu Water Resource Official Reports (GPBWR 2003)
Water Scarcity and Water Use in Economic Systems in Zhangye City
2659
where x is an n × 1 vector of gross output, y is an n × 1 vector of final demand, A is an
n × n matrix of technical coefficients, I is the n × n unity matrix, and (I - A)−1 is the
“Leontief inverse” which gives the direct as well as indirect requirement coefficients.
For more detailed introduction to input–output analysis see Miller and Blair (1985)
and Leontief (1986).
Equation 1 provides a framework for considering specific questions about the
relationship between economic structure and economic activity and so opens up
a path for the study not only of economic production but also of the effects of
production and consumption on the physical environment (Suh 2004; Munksgaard
et al. 2005; Roca and Serrano 2007).
2.2.2 The Intensity of Water Consumption
As done in other works (Lenzen and Foran 2001; Velázquez 2005; Okadera et al.
2006), water was considered to be a production factor and measured
in physical units
in the study. The physical water consumption of a given sector w dj , j = 1, . . . , n
divided by the gross output of this sector (x j) leads to a coefficient of direct water
consumption intensity w d∗
j , that is
d
w d∗
(2)
xj
j = wj
In addition to this physical water consumption, other goods and services are
required by the production processes of a given sector. Consequently, in order to
produce the inputs generated by other sectors, another requirement of water is also
necessary. For this sector, it is the indirect water consumption. Direct consumption
plus indirect consumption together amount to the total water consumption. Following Lenzen and Foran (2001), the level of total water consumption per output can be
calculated as:
w t∗ = w d∗ (I − A)−1
(3)
t∗ t∗
d∗ d∗
t∗
t∗
d∗
d∗
where w = w1 , w2 , · · · , wn and w = w1 , w2 , · · · , wn represent the coefficient vectors of total and direct water consumption intensities, respectively.
2.2.3 The Matrix of Intersectoral Water Relationships
Equation 3 captures the total water consumption if the final demand of any given
sector changes by one unit. Rewriting this equation as its Taylor expansion, one can
separate the direct from the total water consumption required to sustain production
by an economy (Waugh 1950):
w t∗ = w d∗ + w d∗ A + w d∗ A2 + · · · + w d∗ An + · · ·
(4)
where, w is the water requirement for one unit of final demand from all sectors, I.
This represents the direct water consumption. w d∗ A is the water required to allow
the production of A · I. This is the “first-round” indirect water consumption. w d∗ A2
is the water necessary to allow the production of A(A I). This is the “secondround” indirect water consumption. w d∗ An is the water needed to produce the goods
A(An−1 I). This is the “nth-round” indirect water consumption. Clearly, the total
indirect water consumption is the sum of all rounds of consumption.
Based on Eqs. 3 and 4, we can proceed to formulate a matrix of intersectoral water
relationships (w ∗ ) associated with the final demand of an economy by subtracting the
d∗
2660
Y. Wang et al.
direct water consumption from the total water consumption and changing the form
of the direct water consumption vector.
∧ w ∗ = w d∗ (I − A)−1 − I ŷ
(5)
where ∧ indicates that the vector’s elements should be placed along the diagonal of a
matrix.
The elements wij∗ i, j=1,2,...,n of w* indicate the additional quantity of water
consumed by sector i for the production of final demand in sector j. Thus, the sum
of all the elements of column j expresses the total indirect water that required by
sector j to produce the final demand of an economy, and the sum of all the elements
of row i expresses the total indirect water that supplied by sector i to produce the
final demand of an economy.
2.2.4 The Water Consumption Multiplier
Our analysis also accounts for the “drag” effect of direct water consumption, which
can be calculated with the intensities of total and direct water consumption defined
earlier (Velázquez 2005):
(6)
mdj = w t∗j w d∗
j
where mdj is the water consumption multiplier that expresses the total quantity of
water consumed by the whole economy per unit of physical water used directly to
satisfy the demand of sector j.
After the multiplier mdj has been defined, it is easy to obtain a multiplier of indirect
water consumption midj , simply by subtracting one from the mdj .
midj = mdj − 1
(7)
In this way, the indicator yields an estimate of the quantity of water used indirectly
by sector j for each unit of physical water that is consumed directly.
2.3 Data
In our analysis, we used two primary datasets: the quantity of water consumption for
production sectors (in biophysical units) and the input–output tables (in monetary
value units). The water data used in this paper was obtained from the Gansu Water
Resource Official Reports, published every year by the Gansu Provincial Bureau of
Water Resources (GPBWR 2003). At the most detailed level, water-intensive agricultural water use is divided into four categories: “Farming”, “Forestry”, “Animal
husbandry”, and “Fisheries”. Other production use categories include “Mining and
processing”, “Manufacturing”, “Production and supply of electric power and heat”,
“Construction”, “Transportation and communications”, and “Services”. Thus, in this
analysis, we used ten categories of production consumption of water.
For the economic data, the basic input-output table for Zhangye in 2002 was
constructed by the Office of the Input–Output Survey, Gansu Statistical Bureau.
This input–output table classification is based on 17 sectors, and its framework
centers on the supply and use tables for products, including the structure of the
Water Scarcity and Water Use in Economic Systems in Zhangye City
2661
intermediate consumption of production sectors, final consumption, and exports and
use of imported goods at current prices. To make the complete data set consistent,
a few adjustments to the basic input–output table were necessary due to limitations
of the water consumption data. As a result, we integrated the seven of the 17 sectors
into the other sectors and created a simplified 2002 table for Zhangye that represents
a ten sector by ten sector input–output table, whose classification of economic sectors
is consistent with our division of the ten water use categories.
3 Results
Table 2 shows the intensities and multipliers of water consumption in Zhangye.
Our results show that the water consumption intensity (direct or total) of the
agricultural sectors (“Farming”, “Forestry”, “Animal husbandry”, and “Fisheries”)
was considerably greater than that of the other sectors because of the large physical
water use in these sectors. As shown in Table 2, Per unit output, direct and total
water consumption were all highest in the “Fisheries” sector at 1,294.2 and 1,688.5 m3
per thousand Yuan, respectively. In comparison, although indirect water use by the
industrial and service sectors (“Mining and processing”, “Manufacturing”, “Production and supply of electric power and heat”, “Construction”, “Transportation and
communications”, and “Services”) revealed that their total water use was higher than
has been traditionally assumed, their water consumption intensities remained lower
than those of the agricultural sectors.
As examining the composition of total water consumption (i.e., by comparing
direct versus indirect consumption), one can note that the water consumption was
primarily direct in all agricultural water use categories except “Animal husbandry”.
As shown in Fig. 2, direct consumption accounted for 83% of the total consumption
in “Forestry”, 81% in “Farming”, and 77% in “Fisheries”. The high ratios of direct
water consumption to total water consumption indicates that the water used in
their production processes is primarily “real” water that originates from the limited
surface and underground water resources.
Contrary to the situation in the agricultural sectors, most industrial and service
sectors were characterized by relatively high ratios of indirect water consumption
to total water consumption. With the exception of the “Production and supply
Table 2 Water consumption intensities and water consumption multipliers for Zhangye City, 2002
Sectors
Farming
Forestry
Animal husbandry
Fisheries
Mining and processing
Manufacturing
Production and supply of electric power and heat
Construction
Transportation and communications
Services
Intensities (m3 /103 yuan)
Multipliers
Direct
Total
Total
Indirect
589.8
854.2
89.8
1,294.2
5.4
9.3
41.2
1.8
1.2
1.8
725.3
1,025.1
308.5
1,688.5
65.3
163.1
87.3
89.6
62.8
45.4
1.2
1.2
3.4
1.3
12.0
17.6
2.1
48.7
54.6
25.4
0.2
0.2
2.4
0.3
11.0
16.6
1.1
47.7
53.6
24.4
2662
Y. Wang et al.
Scetors
Fig. 2 Composition of the
total water consumption
10
9
8
7
6
5
4
3
2
1
0%
20%
40%
60%
Compositions
direct water consumption
80%
100%
indirect water consumption
of electric power and heat”, more than 90% of the total water consumption in
the industrial and service sectors was attributable to indirect water consumption
(Fig. 2). In our view, although these sectors use only a small amount of water
directly in production, in order to produce the inputs (generated by other sectors)
that they incorporate into their production processes, a high consumption of water
is necessary. This can be confirmed by examining the values of the indirect water
consumption multiplier (Table 2). For each cubic meter of water consumed directly
in the “Transportation and communications sector”, satisfying an increase of production requires the consumption of an additional 53.6 m3 of water by other production
sectors. Similarly, in the “Construction” sector, each cubic meter of water consumed
directly requires the indirect consumption of an additional 47.7 m3 of water by the
other sectors. Overall, increases in the production of these industrial and service
sectors would require additional inputs from other sectors, locally or nationally.
Table 3 shows the intersectoral water relationships, which indicate that the
indirect water demand of the economy in the study area was mainly satisfied
with products generated by “Farming” sector. As shown in Table 3, satisfying the
production of final demand required an additional 1,329.1 × 106 m3 of indirect
water to be consumed by the economy of Zhangye. Among them, 1,072.4 × 106 m3
of indirect water were supplied by “Farming”. Although sectors such as “Animal
Table 3 Matrix of intersectoral water relationships (106 m3 )
Sectors
Sectors
1
2
Sum
3
4
5
6
7
8
9
10
Farming
245.4 3.8 157.2 24.3 14.4 341.4 7.5 184.1 21.5 72.9 1072.4
Forestry
1.9 19.0
0.6 0.4 0.3
2.8 0.1
1.8 0.3
3.4
30.5
Animal husbandry
18.6 0.1
3.0 0.4 0.6 14.6 0.3
7.5 0.9
3.2
49.2
Fisheries
0.9 0.1
0.4 5.1 0.6
3.4 0.3
3.4 0.7 14.5
29.3
Mining and processing
0.2 0.0
0.1 0.0 0.5
1.4 0.2
2.1 0.1
0.5
5.2
Manufacturing
4.2 0.2
1.5 0.2 1.5 13.6 0.8 18.9 2.1
6.6
49.5
Production and supply of
5.1 0.3
1.3 0.3 6.1 22.4 5.4 28.9 3.0 11.1
83.9
electric power and heat
Construction
0.2 0.0
0.0 0.0 0.1
0.4 0.1
1.0 0.2
0.8
2.7
Transportation
0.1 0.0
0.0 0.0 0.1
0.3 0.0
0.4 0.1
0.3
1.4
and communications
Services
0.4 0.0
0.1 0.0 0.2
1.4 0.1
1.4 0.3
1.2
5.2
Sum
276.9 23.6 164.2 30.7 24.3 401.6 14.8 249.4 29.2 114.5 1329.1
Water Scarcity and Water Use in Economic Systems in Zhangye City
2663
Husbandry”, “Manufacturing”, and “Production and Supply of Electric power and
heat” were other significant suppliers of indirect water, their indirect water demands
in production process were satisfied with “Farming” sector. For instance, in “Animal
Husbandry” sector, the indirect water supplied by the “Farming” sector was 157.2 ×
106 m3 , amount to 96% of its all indirect water requirements. Similarly, the percentages in “Manufacturing”, and “Production and Supply of Electric power and
heat” sectors were 85% and 51% respectively. These results convey the idea that
the water consumed in Zhangye is first “embodied” in “Farming” products, and then
incorporated into other sectors as an intermediate input.
4 Discussion and Conclusions
Decades ago, water was viewed as a non-limited natural resource because it was
renewed every year in the course of the seasons. Man progressively appropriated this
resource and used it with few restrictions. Developments in controlling and diverting
surface waters, exploring groundwater, and in using the resources for a variety of
purposes have been undertaken without sufficient care being given to conserving and
avoiding misuse the natural resource. As a result, the physical water resource scarcity
condition was transformed into a socially conditioned water resource scarcity.
Irrigated agriculture, which represents the bulk of the demand for water in most
developing countries, is also usually the first sector affected by water shortage and
increased water scarcity. In addition to the magnitude of the production in this sector,
it can be explained by the great water consumption intensities and the high rate of
direct consumption. The findings indicate that a slight increase in production in this
sector would greatly increase the consumption of real water. However, we found that
the increase of agricultural production was extraordinary over the past two decades.
Between 1978 and 2002, the output value for “Farming” has increased from 136.0
million Yuan to 726.5 million Yuan in constant 1978 prices, representing an increase
to above five times the 1978 value. The outputs of “Forestry” and “Fisheries”
also increased remarkably during the same period, with increases from 2.4 million
Yuan to 28.1 million Yuan and from 8,000 Yuan to 2.7 million Yuan, respectively
(GSB 1979–2003). The massive expansion of agricultural activities during this period,
therefore, had inevitably resulted in increasing use of water resources.
Water consumption and demand have increased everywhere for agriculture and
irrigation. However, these increases were particularly evident in Zhangye, where
water is scarce and extremely valuable. As shown in Fig. 3, with the exception of
“Animal husbandry”, other agricultural sectors in Zhangye City had experienced
greater growth than those in China and Gansu Province since the Chinese national
economic reforms that began in 1978. Moreover, in spite of the improvement in
water-use efficiency in China year after year, the improvement in the study area
is insignificant because of the fixed plant structure and the old irrigation system.
Nowadays, 97% of the farmers continue using traditional flood irrigation methods
such as flood and furrow irrigation (Chen et al. 2005). The expanding agriculture, therefore, is likely to be responsible for the increasing scarcity of water in
Zhangye city.
Virtual water provides a trade policy approach to resolving the regional watercrisis. According to the theory of comparative advantage, nations can gain from trade
2664
Y. Wang et al.
600
1300
Farming
Forestry
550
1100
Growth rate (%)
Growth rate (%)
500
450
400
350
300
250
200
900
700
500
300
150
100
100
1978
1990
1993
1996
1999
2002
1978
1990
Year
1000
1993
1996
1999
2002
1999
2002
Year
48100
Animal husbandry
Fishery
900
40100
Growth rate (%)
Growth rate (%)
800
700
600
500
400
32100
24100
16100
300
8100
200
100
1978
1990
1993
1996
1999
2002
100
1978
1990
1993
1996
Year
Year
Zhangye
Gansu
China
Fig. 3 The growth rates of agricultural gross output in China, Gansu Province and Zhangye City
during the period 1978–2002. Take the gross output value of 1978 as 100 and all the gross output
values (GSB 1979–2003; NBSC 1979–2003) are calculated at constant 1978 prices
if they concentrate or specialize in exporting the production of goods and services
for which they have a comparative advantage, while importing goods and services
for which they have a comparative disadvantage (Wichelns 2004). Consequently, a
water-scarce region can thus aim at importing products that require a lot of water in
their production (water-intensive products) and exporting products or services that
require less water (water-extensive products). This is called the “import of virtual
water” (Allan 1997), and net import of virtual water in a water-scarce region can
relieve the pressure on its water resources. However, this does not currently seem to
be happening in Zhangye.
As analyzed in Section 3, the production of the economy (especially of the
industrial and service sectors) would cause a high consumption of physical water by
the “Farming” sector. This means that the industrial and service sectors require large
quantities of products produced by the “Farming” sector as intermediate inputs to
satisfy the demand created by their production. But it is important to note that in our
study area, most of these inputs from the “Farming” sector are supplied only locally,
not by other regions. In fact, as an important producer of commodity grains for
Gansu province, Zhangye exports large volumes of farm products every year to other
Water Scarcity and Water Use in Economic Systems in Zhangye City
2665
regions, in addition to meeting its own demand. Consequently, outside agricultural
products, with high virtual water content, can not currently enter Zhangye in large
quantities via commodity trade.
Table 4 shows the commodity and the virtual water trade balance in Zhangye.
Products of “Farming” and “Animal husbandry”, which are characterized by relatively higher virtual water contents, show a strongly positive net export balance.
That is, large amounts of virtual water flow from Zhangye to other regions every
year in the form of exported agricultural products. In contrast, products such as
those of the “Manufacturing”, “Production and supply of electric power and heat”,
“Construction”, and “Services” sectors show strong positive net imports. That is,
the virtual water imports are lower due to the low total water consumption in
the production processes of these sectors. Overall, although the commodity trade
presented a net import balance, Zhangye made a great net virtual water “loss” from
the exchange of commodities. This led to a net outflow of approximately 489.0 million
cubic meters water, roughly equivalent to 20% of all the water consumption of the
city. A net regional virtual water loss from a trade relation puts increasing pressures
on the scarce water resources.
With the regard to the calculation of virtual water contents of imports, we would
like to point out that the task is not so straightforward as for exports, since the
coefficients of water consumption intensity should be estimated based on input–
output tables of the relevant regions from which the imports come. Evidently, this
would be a difficult task in operation. Here, we assumed that the water consumption
intensities to be used in assessing the virtual water embodied in imports are the
same estimated for domestic industrial production. While this may not be ideal, the
calculation method is useful because it could provide information to the decision
maker how much water was saved by importing goods.
Even though the most direct positive effect of virtual water trade is the water
savings that generated from product imports for importing regions, water loss
generated from product exports is still obvious for exporting regions. This is the
case with Zhangye. To judge from our findings, the trade structure of exports and
Table 4 Commodity trade and virtual water balance in Zhangye City, 2002
Sectors
Farming
Forestry
Animal husbandry
Fisheries
Mining and processing
Manufacturing
Production and supply
of electric power and heat
Construction
Transportation
and communications
Services
Sum
a Come
Commodity (106 Yuan)
Virtual water (106 m3 )
Exportsa
Importsa
Net exports
Exports
1,179.85
22.76
380.96
5.40
210.15
285.16
0.00
12.05
38.18
93.16
77.40
139.58
1,642.30
877.17
1,167.80
−15.42
287.81
−72.00
70.56
−1, 357.14
−877.17
868.91
251.35
982.83
111.63
549.79
3,754.32
876.78
4,851.07
Imports
Net exports
855.79
23.33
117.51
9.12
13.72
46.50
0.00
8.74
39.13
28.73
130.68
9.11
267.79
76.54
847.04
−15.81
88.78
−121.57
4.61
−221.29
−76.54
−113.92
139.72
77.82
15.78
88.03
7.01
−10.20
8.77
−326.98
−1, 096.75
24.94
1,184.50
39.77
695.53
−14.83
488.97
from The Office of the Input–Output Survey, Gansu Statistical Bureau.
2666
Y. Wang et al.
imports is inconsistent with a virtual water strategy designed to maximize the value of
Zhangye’s limited water resources. Therefore, water resource scarcity is not always
the consequence of limited absolute supply or increased demand, but may also be
due to inadequate resource management, poor coordination and poor allocation.
From the point of view of regional sustainable development, switching from waterintensive, low-valued crops to higher-valued crops that require smaller diversions
of irrigation water and reducing the export of virtual water appear to be necessary
strategies for this arid area. Moreover, the industrial and service sectors which
exhibited higher figures of indirect water consumption are the “driving forces” of
the Zhangye economy due to the strong influence that their respective demands
exert on the production of the rest sectors. These sectors should be supported by the
local government for their drag effects upon the economy as well as the agricultural
sectors. Their developments could maximize the value of Zhangye’s virtual water.
The causes of water scarcity are varied. This study has addressed only the question
of how a problematic agriculture and trade had exacerbated water scarcity conditions
in Zhangye City based on the analysis of structural relationships between economic
activities and their physical relationships with the region’s water resources. Hence,
we think that our research is merely a first and incomplete approach to the issue.
Another potential problem is that the division of the economic sectors is rough.
Such a rough division might hide the differences of sub-sectors, as mentioned by one
reviewer of this paper. Moreover, the input–output table used in our analysis was for
the year 2002, and the present economic structure might be different from that of
2002. This problem may impose certain limitations on the analysis of our results. In
addition, the input–output model adopted in our study is characterized by constant
prices, fixed proportion production, and linear demand (Lenzen 2003; Spörri et al.
2007). This situation might lead to overstate the indirect water consumption because
it ignores the potential substitution of production factors. Not withstanding these
limitations, this study has produced some important findings, which might help to
raise the awareness of governments about local water resources management. In the
next stage of our research, we plan to update the data and complete our analysis on
the issue of water scarcity with other factors, such as the land use pattern, the water
price policy and the employment generated by each economic sector.
Acknowledgements This research is part of the results from project KZCX2-XB2-04-03, which was
funded by the Chinese Academy of Sciences. We thank the members of the Input–Output Survey
Office, Gansu Statistical Bureau, for providing the data required by our study. We also appreciate the
journal’s editor and anonymous reviewers for their helpful comments and suggestions on an earlier
version of the paper.
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