NDRC Backs Rises in Local Water Prices

China's National Development and Reform Commission expressed its support for recent moves by some local governments to raise water prices in a statement posted to the NDRC's website on August 3.

Since the beginning of the year, six cities including Tianjin, Shanghai, Nanjing, Guangzhou, Lanzhou and Yinchuan have all raised their water prices and other cities like Shenyang and Xi'ning have also signaled their intention to follow suit.

The NDRC interpreted such moves as being in line with the broad direction of the country's resource price reform and also indicated that they were necessary in terms of encouraging theefficient use of water and conserving natural resources.

However, the recent price rises have not been welcomed by the public, as reflected in a recent on-line survey launched on China's largest web portal Sina.com.cn. As of press time, of the total 35,478 respondents, 86% had expressed their opposition to the rise in prices.

According to the NDRC, the average price of water for domestic and industrial use in 36 medium-and large-sized cities, reached 2.35 yuan and 3.19 yuan per ton respectively, up 12.4% and 17.2% compared with 2005 price levels.

Meanwhile, NDRC noted that at present urban water is relatively cheap and charges imposed for sewage treatment and water usage were also relatively low.

The NDRC also issued a joint circular with the Ministry of Housing and Urban-rural Development that requires local governments to raise the amount of subsidies they provide for low-income families so as to ensure they can afford basic water supplies despite the recent price rises.

The NDRC's support of the recent rises in the price of water can be seen in the context of their attempts to reform the way that China's resources including electricity and oil are priced.

Links and Sources
NDRC: Original Statement (Chinese)
Sina: Water Price Survey