AN INPUT–OUTPUT ANALYSIS OF TRENDS IN VIRTUAL WATER TRADE AND THE IMPACT ON WATER RESOURCES AND USES IN CHINA

Abstract

This study investigates the impacts of China's international trade on its water resources and uses between 2002 and 2007. The results show a significant increase in water use efficiency in most sectors, especially the manufacturing sectors. However, the total net virtual water exported increased by about 75%, from 39.0 × 10⁹ m³ to 68.2 × 10⁹ m³. The ratio of net virtual water exports to the total water resources of the country increased from 1.8% to 3.1%. In water-scarce North China, the ratio increased from 3.6% to 5.1%, which indicates a growing water resources pressure. The share of the net virtual water exports in the total water use in China increased from 7% to 12%. The results suggest that China's economic gains from intensifying international trade came with high costs regarding its water resources.

Keywords:

• Virtual water trade
• Input–output analysis
• Water scarcity
• Blue water use
• China

Acknowledgements

We would like to acknowledge the support from the National Natural Science Foundation of China (#71173212, #70921061).

Notes

¹ Tibet is not included in the study due to data unavailability.

² Our definition of blue and green water follows that by Falkenmark and Rockström (2006).

³ In addition, strict assumptions would be made regarding similarity of production technologies in the region under consideration and the rest of the world (see Dietzenbacher et al., 2007).