Understanding Beijing's Water Challenge - American Chemical Society

Nov 5, 2012 - Graduate University of Chinese Academy of Sciences, Research Centre on Fictitious Economy & Data Science, Chinese Academy of. Sciences, ...
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Understanding Beijing’s Water Challenge: A Decomposition Analysis of Changes in Beijing’s Water Footprint between 1997 and 2007 Zhuoying Zhang:,† Minjun Shi:,‡ and Hong Yang:*,§ †

Academy of Mathematics and Systems Science, Chinese Academy of Sciences, University of Chinese Academy of Sciences, No.55, Zhongguancun East Road, Haidian District, 100190, Beijing, China ‡ Graduate University of Chinese Academy of Sciences, Research Centre on Fictitious Economy & Data Science, Chinese Academy of Sciences, No.80, Zhongguancun East Road, Haidian District, 100190, Beijing, China § Swiss Federal Institute of Aquatic Science and Technology, Ueberlandstrasse 133, 8600, Duebendorf, Switzerland. S Supporting Information *

ABSTRACT: Beijing has been experiencing increasing water shortage alongside its astonishing economic growth over the past decades. This study conducts a quasidynamic input-output (IO) analysis to investigate changes in Beijing’s water footprint (WF) and decompose the effects of contributing factors to the changes during 1997−2007. The analysis distinguishes “internal” and “external” WF to depict connections of Beijing’s water use with outside. The results show an increase in Beijing’s WF from 4342 million m3 in 1997 to 5748 million m3 in 2007. Almost all the increase was attributable to the expansion of the external WF, while the internal WF only changed slightly, indicating a growing dependence of Beijing on external water resources. The decomposition analysis reveals that the technological effect was the principal contributor to offset the WF increase and the structural effect stemmed from the shift of demand toward products of the tertiary industries also contributed to reducing the WF. However, these effects were not sufficient to reverse the expansion of Beijing’s WF resulted from the scale effect induced by expansion of final demand and the economic system efficiency effect associated with the growth of trade between Beijing and outside. The study provides insights into Beijing’s water challenge and sheds lights on the combating strategies for the future. It is also an endeavor to enhance the policy relevance of the WF studies.

1. INTRODUCTION The past decades have witnessed Beijing’s vigorous economic growth, population expansion and industrial structure transition. Alongside these changes are the intensification of water shortage and deterioration of aquatic environment. Located in the Asian temperate climate zone, Beijing receives an average annual precipitation of approximately 600 mm/year with most of it concentrated during the summer season. The average annual total water resources of Beijing amount to 2308 million m3/year, including surface and groundwater.1 Over the years, the population growth has continuously reduced per capital water resources availability, from about 470 m3/capita/year in the early 1980s to about 300 m3/capita/year in the late 1990s, and further reduced to 107 m3/capita/year at the end of the first decade of this century. On the other hand, the annual total water use in Beijing has changed recursively from 4200 million m3/year to 4300 million m3/year and to 3500 million m3/year during the respective time periods.1,2 The exceeded water use over its own water resources is possible primarily due to the water transfer into Beijing and the overwithdrawal of groundwater. Although the water shortage in Beijing was already noted in the early 1980s, the serious attention on the problem and substantial efforts to deal with it mainly started in the late 1990s. Many measures have been implemented to © 2012 American Chemical Society

improve water use efficiency (e.g., promoting water-saving technologies, encouraging water reuse and recycling, renovating irrigation systems, etc.), enlarge the supply (mainly transferring water from outside into Beijing) and curb the demand (e.g., increasing water prices).3 Despite the efforts, water shortage and environmental degradation have tended to aggravate over the years. A comprehensive investigation into Beijing’s water use structure, water connections with outside through trade, and the driving forces of changes is important for gaining a better understanding of the water challenge faced by Beijing. To this end, the perspectives of virtual water (VW) and water footprint (WF) are particularly useful to guide such an investigation. VW is defined as the water used for the production of commodities.4−6 WF refers to the volume of freshwater used during the production process, measured over the full production chain.7 WF of a product is numerically equal to “VW content”. WF can be categorized into green, blue, and gray according to the types of water used in the production Received: Revised: Accepted: Published: 12373

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Table 1. Water Use Coefficients in 1997, 2002, and 2007 (m3/104Yuan) (1USD ≈ 6.5Yuan as of 2012) sectors 1-AGR 2-MIN 3-FDP 4-TXT 5-WAL 6-PTF 7-PPP 8-PPC 9-CMP 10-NMP 11-SPM 12-MSM 13-TPE 14-EME 15-CCE 16-MMO 17-OMS 18-EHP 19-PSW 20-CTR 21-FTS 22-ICS 23-WRT 24-HCS 25-TSM 26-RED 27-ECE 28-HSS 29-SVH 30-OTS

agriculture mining food processing manufacture of textile manufacture of wearing apparel and leather processing of timber and manufacture of furniture manufacture of paper and paper products processing of petroleum and coking manufacture of raw chemical materials and chemical products manufacture of nonmetallic mineral products smelting, pressing and manufacture of metals manufacture of special purpose machinery manufacture of transport equipment manufacture of electrical machinery and equipment manufacture of communication equipment, computers and other electronic equipment manufacture of measuring instruments and machinery for cultural activity and office work other manufacturing sectors production and supply of electric power and heat power production and supply of water construction freight transport and storage information transmission, computer services and software wholesale and retail trades hotels and catering services tourism research and development education, culture and entertainment health, sports and social welfare service to households other technical services

DWUC

DWUC

DWUC

1997

2002

2007

1997

TWUC 2002

2007

754 92 73 50 9 14 151 45 79 53 57 8 12 12 7 9 5 258 1040 11 29 8 16 133 36 6 8 9 37 9

414 41 33 22 4 6 68 20 35 23 26 3 5 5 3 4 2 133 535 6 15 4 8 68 19 3 4 5 19 5

364 19 15 10 2 3 31 9 16 11 12 2 3 2 2 2 1 70 282 3 8 2 4 36 10 2 2 2 10 3

993 153 481 285 150 119 234 159 228 149 159 93 107 108 93 80 71 300 1176 109 109 32 78 439 157 40 44 114 104 71

637 109 178 155 74 86 140 109 124 91 102 61 61 63 53 44 27 178 652 66 61 37 37 153 48 47 48 72 66 59

588 65 222 84 44 63 92 68 84 67 66 39 39 43 38 33 54 190 338 51 42 27 28 130 63 37 43 55 48 69

the total water used for the production of products to meet the final demand of the inhabitants of Beijing, whereas the latter refers to the total water use that is from the local (Beijing) sources. There is a large literature on VW and WF.5,6,12−14 Most of the previous studies have focused on agricultural products due to their generally high water intensities and large shares in total water use on the one hand, and the difficulties in quantitatively tracing the intersectoral connections along the production chain of the industrial sectors on the other. In recent years, the input-output (IO) model, a technique quantitatively depicting the interconnection and interdependences of economic activities, has been applied in the VW and WF assessment of a region.11,15−18 Some studies have extended the assessment to cover all the economic sectors.9,19−22 However, there are two main gaps lying in these studies. One is the static analysis which only provides “snapshot information” using the data of a single year or an average over a period of time. Dynamic studies investigating changes in WF at different times are rare due to data constraint. More importantly, the existing studies have mostly only provided descriptions on “what the situation is”, but no explanations on “how the situation is shaped”. Studies investigating the driving forces of the changes remain very limited. A decomposition analysis of contributing factors to the changes in an IO framework has been absent. This study attempts to bridge the above gaps by conducting a quasi-dynamic analysis on the changes in Beijing’s WF and VW trade in an IO framework. A decomposition analysis of the key

process. The blue WF refers to the use of surface and groundwater resources along the production chain, the green WF refers to the use of soil moisture, and the gray WF accounts for the volume of freshwater used to assimilate the load of pollutants based on natural background concentrations and existing ambient water quality standards.7 WF of a region or nation is the aggregated volume of water used to produce goods and services consumed by the inhabitants of the region or nation. The term WF is usually used in the context where consumers or producers of products are concerned,7−9 whereas the term virtual water is mostly used in the context of international or interregional trade.4,5,10,11 From the perspectives of VW and WF, water use of a region and/or sector is linked with the economic activities and water uses beyond the regional and sectoral scope. Beijing has a large trade of goods and services with other regions and countries. Not all Beijing’s water use is for the production of products for local demand. Part of the products is exported, leading to an outflow of VW. The part of the products consumed locally constitutes the internal WF of Beijing. On the other hand, Beijing imports a large quantity of products for either final or intermediate demand, which brings an inflow of VW. The part of the imported VW remained in Beijing for the demand of its inhabitants forms the external WF of Beijing. The part re-exported has no direct effect on Beijing’s WF. The total WF of Beijing is the sum of the internal and external WF. This amount differs from Beijing’s water use volume commonly available in statistics. The former refers to 12374

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production chain, for example, from cotton production to a pair of jeans. It provides a more complete picture of water use intensity. TWUC values for the 30 sectors in this study are calculated by multiplying DWUC with the Leontief inverse matrix, which in the IO analysis denotes how much output of a sector is required to meet one monetary unit of the final demand of another sector.30 (See the Supporting Information for details of the Leontief inverse matrix.) In the investigation of changes in DWUC and TWUC, all the related monetary values are adjusted to the constant price of 2007. 2.2. Methodology. The IO model represents the monetary transactions of goods and services among different sectors of an economic system.30 The estimation of WFs of individual sectors follows the procedure used by Zhao et al.9 and Zhang et al.(a).21 A quasi-dynamic investigation into the changes in Beijing’s WF is conducted by applying the structural decomposition analysis (SDA) which is an approach quantifying the relative importance of contributing effects by means of a set of comparative static variations in key parameters in the IO tables.31 SDA can help identify the underlying determinant effects that contribute to the changes of a variable over time.32 Extending the IO model to account for the contributing effects behind the changes can reveal the causes of the targeted phenomenon (i.e., changes in WF in this study) and channels they are transmitted throughout the economic system.33 In this study, the contributing effects of Beijing’s WF changes during 1997−2007 are decomposed into technological effect, economic system efficiency effect, scale effect and structural effect. Technological effect denotes the influence of changes in the direct water use efficiency reflected by DWUC. It accounts for the effect of technological change on the amount of water use for one monetary unit of output.34 Technology improvement typically reduces the WF of a given product. Economic system efficiency effect represents the influence of the interdependence among different sectors based on supply and demand in the economic system. It is reflected by the impact of changes in the Leontief inverse matrix on the WF of Beijing. Scale effect refers to the influence of changes in the total amount of final demand of Beijing on its WF. The rapid population growth experienced in Beijing typically leads to the expansion of total amount of final demand for goods and services, imposing a large scale effect on changes in the WF. Structural effect depicts the role of changes in the sectoral distribution of the final demand. It is typically associated with the increased proportion of demand for the high-tech and services products in the total final demand of Beijing people. Generally, SDA can be conducted based on either the “base year value” or the “end year value”. In this study, the average values of the decomposition results of the base year and the end year values are adopted. This treatment is widely accepted in the relevant studies since it is intuitive in mathematical format, simple in execution and feasible in comparison of the weights of different effects.35−37 The decomposition based on the “base year value” can be presented as follows:

determinants leading to the changes is conducted. The investigation is made for the period 1997−2007. Focusing on this period is partly because of the availability of the data. Given the fact that this period is the time when Beijing experienced rapid industrial transformation and fast economic growth, while many measures aiming at alleviating its water stress were implemented, it is of significance to examine their influences on Beijing’s water situation. By decomposing the factors contributing to the changes in Beijing’s WF, the policy implications of the results can be better elaborated.

2. DATA AND METHODOLOGY 2.1. Data. The main data sources of this study are Beijing IO tables of 1997, 2002, and 200723−25and the data of Beijing sectoral freshwater uses.22 The two data sources have inconsistent sector divisions: the former has 42, while the latter has 33. This study merged the sectors into 30 to match the sectoral divisions of the two data sources (see Table 1 for the sector divisions). In Beijing’s IO tables, import includes both regional (import from other regions within China) and international (import from foreign countries) sources, so do the export. In the following WF accountings, the effects of the interregional and international trade on Beijing’s WF are not discriminatively discussed. In this study, water resources, water uses, WF and VW concern only blue water, that is, surface and groundwater. Green water or soil moisture is not considered. This is because except for the agricultural sector and the sectors to which agriculture provides raw materials, all other sectors exclusively use blue water. Including green water would greatly increase the share of agricultural water use and thus derive biased conclusions in assessing the value of water use across different sectors.9 The ignorance of gray water footprint is due to the lack of information on the nature of pollutants and pollution intensity from different sectors. The lack of information has generally impeded the inclusion of gray water in WF assessment involving multiple industrial sectors in the literatures.8,9,15 In the industrial sectors, direct water use concerns the freshwater intakes. It excludes the recycled and reused water within the systems. The wastewater discharge was not deducted from the direct water use because the polluted water may not be used again without treatment. The same procedure is also taken in many other studies.9,18,26 In the agricultural sector, the return flow (primarily from irrigation) was deducted from the water use by multiplying it by the water depletion rate. The depleted water in the agricultural sector refers to the portion of water that is “lost” during conveyance, and to evapotranspiration, products incorporation, animal drinking, etc. The remainder is the return flow which is available to the downstream users. The direct water use coefficient (DWUC) refers to the amount of direct water intake to produce one monetary unit of production. DWUC is prerequisite for the WF accounting. In this study, the database for DWUC in the 30 sectors follows Zhang et al. (2011b).22 The data were adjusted based on the water use information in Beijing Water Resource Bulletins of each year.27−29 DWUC is the conventional measure for the sectoral water use intensity. However, it does not reflect the total water embodied in final outputs because a large amount of water use occurs in the upstream production chain. The total water use coefficient (TWUC) for one monetary unit of production reflects the water use throughout the whole

△ti = [∑ (△wi)bij1]Y1βi1 + [∑ wi0(△bij)] i

i

Y1βi1 + (∑ wi0bij0)(△Y )βi1 + (∑ wi0bij0)Y0(△βi ) i

i

(1) 12375

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Figure 1. Sectoral composition of WF of Beijing in 1997, 2002, and 2007.

The decomposition based on the “end year value” is

And the structural effect, Sti, is represented by (Δβi):

△ti = [∑ (△wi)bij0]Y0βi0 + [∑ wi1(△bij)]

St i =

i

i

Y0βi0 + (∑ wi1bij1)(△Y )βi0 + (∑ wi1bij1)Y1(△βi ) i

△ti = Ti + E i + Sc i + St i

In the above equations, the subscripts “1” and “0” denote end year and base year, respectively. Δti is the change in WF. wi is the DWUC of sector i, calculated by dividing the water use of sector i by total output of sector i (in monetary term). bij is the element of the Leontief inverse matrix. Y is the summation of the final demand of all the sectors. βi is the percentages of the final demand of sector i in the total final demand of all the sectors. Δwi, Δbij, ΔY and Δβi represent the changes in wi, bij, Y and βi. In the SDA framework, the contribution of the technological effect, Ti, to the changes in WF is reflected by (Δwi): 1 {[∑ (△wi)bij1]Y1βi1 + [∑ (△wi)bij0]Y0βi0} 2 i i

1 {[∑ wi0(△bij)]Y1βi1 + [∑ wi1(△bij)]Y0βi0} 2 i i

(3)

(4)

The scale effect, Sci, is represented by (ΔY): Sc i =

1 [(∑ wi0bij0)βi1 + (∑ wi1bij1)βi0](△Y ) 2 i i

(7)

3. RESULTS 3.1. Change in Water Use Coefficients. During 1997 and 2007, DWUCs of all the sectors and TWUCs in most sectors decreased substantially (Table 1). Except for 1-AGR whose DWUC decreased by 51%, the decrease in DWUC in other sectors all exceeded 65%. For TWUC, the range of the decrease was 2−70%. The sectors with the most prominent decreases in both DWUC and TWUC include 4-TXT, 5-WAL 19-PSW, 24HCS, all exceeded 70%. 1-AGR has the highest DWUC and TWUC among all the sectors. Other sectors with relatively high DWUC are mainly the utility providers such as 18-EHP and 19-PSW. The sectors with relatively high TWUC include 2-MIN, 3-FDP, 4-TXT, 7PPP, 18-EHP, 19-PSW, and 24-HCS. Of them, 3-FDP, 4-TXT and 7-PPP are the sectors related to the agricultural sector to various degrees. 3.2. Changes in WF. The total WF of Beijing experienced a relatively small increase during 1997−2002 from 4342 million to 4406 million m3, followed by a large jump during 2002− 2007 to 5748 million m3 (See Table S1 in the Supporting Information for details). The increase was entirely attributable to the external sources, whereas the internal WF was rather

The economic system efficiency effect, Ei, is represented by (Δbij): Ei =

(6)

The total contribution of the four determinants to the changes in WF, Δti, is calculated as

i

(2)

Ti =

1 [(∑ wi0bij0)Y0 + (∑ wi1bij1)Y1](△βi ) 2 i i

(5) 12376

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stable. Of the total WF increase of 1406 million m3 during 1997−2007, 1380 million m3 was from the external, only 26 million m3 was from the internal. This situation coincided with the stable water use volume seen in the official statistics of Beijing.27−29 There are significant variations in individual sectors concerning the changes in internal and external WFs. For agriculture and its related sectors, the internal WF witnessed a large decrease. These sectors generally have high water use intensity. The large reduction in the internal WF and substantial increase in the external WF in these sectors indicate a shift of water use to rely more on the external water resources. The sectors of large total WF remained more or less the same over the years (Figure 1). 1-AGR, 3-FDP, and 20-CTR have the largest WF, with the summation of over 50% of the total WF in the three years. The total WF of 1-AGR is stable with only a slight increase; 20-CTR experienced a significant increase in the WF especially between 2002 and 2007, which was clearly in part related to the venue sites construction for the 2008 Beijing Olympics. 3.3. Determinants for the Changes in WF. The contributions of the technological effect, economic system efficiency effect, scale effect and structural effect to the changes in Beijing’s total WF are shown in Figure 2 (see the Supporting Information for the sectoral details).

increase amounted to 15%. No sector had the economic system efficiency effect as the dominant contributor. The dominant contributors for some individual sectors vary during the two subperiods. For example, the WF change in 2MIN was dominated by the structural effect during 1997−2002 whereas during 2002−2007 it was the technological effect. The dominant contributor to the WF change in 9-CMP was the technological effect during 1997−2002 and was the scale effect during 2002−2007. The results were related to the nature of the individual sectors as well as the changes in incentives and policies concerning water use during the respective subperiods.

4. DISCUSSION 4.1. Increasing Dependence on External Water Resources and Relations to DWUC and TWUC. As specified earlier, the internal WF is associated with the use of local water resources of Beijing and the external WF constitutes the water resources outside of Beijing and used by the inhabitants of Beijing through the consumption of imported final and intermediate products. The two WFs have distinctive impacts on local water situation: the former depletes the local water resources, whereas the latter is a water supplement to meet the local final demand. The pressure on local water resources can be lessened through receiving the outside commodities, or the external WF. During the period 1997−2007, Beijing’s dependence on the external water resources rose from 34% to 50%. This was directly related to the policy orientation of the Beijing government. Since the late 1990s, Beijing has gradually put restrictions on water-intensive industries. Many water intensive factories were shut down or moved out of Beijing. The focuses were particularly on the sectors with large WFs. In the meantime, the high-tech industries with high value added but low water intensity were strongly encouraged.38 1-AGR and 3-FDP experienced sharp decreases in the internal WF, and significant expansions in the external WF. This indicates a shift of the sectors to the external waterdependent pattern. As the most water-intensive sector with high DWUC, TWUC, and total WF, 1-AGR has been at the center of Beijing’s strategies in addressing the water scarcity. The scale of agriculture in Beijing has been under strict restriction since the late 1990s.16 Certain water intensive crops such as rice and many vegetables which require irrigation are not allowed to grow locally. Wheat planting has decreased by 80%, replaced mostly by rainfed corn. The demand of Beijing residents for agricultural products is increasingly met by the import from outside. Since Beijing is geographically adjacent to the provinces developed in agriculture such as Hebei, Henan, and Shandong, the trade conditions are favorable. Beijing’s dependence on the external support for agricultural products increased substantially, whereas the internal WF shrank sharply. As the typical downstream sector of agriculture, 3-FDP displayed the similar pattern as seen in 1-AGR for its internal and external WF changes. There is a clear expansion of the internal WF in 22-ICS, 23WRT, 26-RED, and 27-ECE. These sectors all pertain to the tertiary industries which are relatively high in value added and low in water use intensity. As the capital metropolis, Beijing has the advantages in attracting capital, talents and technologies, which are important for the development of tertiary industries. The expansion of the tertiary industries corresponds to Beijing’s water management strategies.

Figure 2. Contribution of the four factors to the changes in the total WF, 1997−2007.

The bar charts above the X-axis indicate the positive effects to the WF increase, while the ones below the X-axis mean the negative effects, i.e., reducing the WF. The technological effect was the principal contributor to offset the WF increase. Twenty-three sectors had the technological effect as the dominant factor. The contribution of the technological effect was over 40% in 9-CMP, 11-SPM, 19-PSW, 20-CTR, 21-FTS, 23-WRT, etc. On the other hand, the scale effect was the main contributor to the WF increase, with the contribution proportion of 39%. The sectors having the scale effect as the dominant contributor include 1-AGR, 3-FDP, 4-TXT, 5-WAL and 24-HCS. The structural effect contributed to reducing the WF to a relatively small extent. Only 10-NMP and 30-OTS have the structural effect as the dominant contributor. The total contribution of the economic system efficiency effect to the WF 12377

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On the side of the positive effects to the WF increase, the contribution of the scale effect was dominant, accounting for 41% during 1997−2002 and 38% during 2002−2007. This was mainly due to the rapid population growth and the demand expansion. During 1997−2007, the population of Beijing increased from 12.4 million to 16.3 million41,42 and the scale of final demand was more than quadrupled from 224 billion Yuan to 914 billion Yuan.23−25 The economic system efficiency effect made considerable contribution to Beijing’s WF increase. The proportions of its contribution in the two subperiods were respectively 9% and 19%. Under the IO framework, the economic system efficiency is reflected by the Leontief inverse matrix, the change of which is resulted from the changes in the direct input coefficient. It is an indicator representing the intersectoral connections based on product supply and demand. The changes in the intersectoral connections can be resulted from the intermediate product substitution caused by technique modification or price fluctuation, decreased demand of intermediate products caused by scale effects, economized raw material input caused by management advancement, etc.43 Since the factors influencing the economic system efficiency are multiple, it is difficult to evaluate the changes in economic system efficiency through the value changes in the Leontief inverse matrix or the direct input coefficients. The positive contribution of the economic system efficiency effect to the WF increase can be explained through an investigation into the direct input coefficient of a sector. We provided an example for sector 3-FDP in the Supporting Information. The significantly larger contribution of this factor during the second subperiod than the first subperiod indicated a deterioration of the economic system efficiency in terms of water uses associated with the VW trade of Beijing with outside. 4.3. Implications for the Future Water Planning of Beijing. The investigation of the changes in the internal and external WF of Beijing and the decomposition of the effects of factors contributing to the changes provide useful references for examining the effects of the past policies and supporting the formulation of future policies for addressing Beijing’s water challenges. Industrial restructuring has had significant impacts on the changes in water use patterns of Beijing. The effort in reducing or controlling the size of high water intensity sectors and reallocating them out of Beijing has led to the stable internal WF and large expansion of the external WF. In the future, the industrial restructuring will continue to play an important role in reducing the pressure on Beijing’s own water resources. The agricultural sector remains one of the focal areas. However, shifting to rainfed agriculture and reducing the size of the sector could have repercussions to farmers’ income and ecosystems. Protecting the interests of farmers and ensuring proper compensation should be placed high in the agenda of the government. The technological improvement has been the major offsetting force for the WF increase during the period studied. Although there is room for further improvement, the marginal cost is expected to increase. This renders a need to consider other factors that can alleviate the water pressure of Beijing and perhaps the other regions, particularly its neighboring water scarce provinces from where a large import originates. The large contribution of the scale effect to the WF increase is primarily attributable to the expansion of population size and per capita demand. The situation raises the need for the city planners to take into consideration the carrying capacity of

20-CTR has relatively low DWUC and TWUC, but very large total WF as the result of massive development of residential houses, and commercial and office buildings. This sector has been an important pillar to support the economic growth of the city. During the period 1997−2007, although technological effect reduced the WF of 20-CTR (see Table S2 in the Supporting Information for details), the joint impact of the other three effects overweighs this amount, resulting in an increase in the WF. Both the internal and external WF increased, but the latter increased more than the former. This indicates an effort to increase the proportion of the external WF. The increase in the internal WF was partly due to the nature of the sector in which a large amount of water must be consumed on site, and hence cannot be substituted by the external WF. Overall, Beijing has experienced a significant transformation in the industrial structure to the direction of controlling the internal WF and substituting with the external WF. The sectors with high DWUC and TWUC and large total WF have been the major targets in Beijing’s water management portfolio. With the government’s “green-development strategy”,39 the industrial restructuring is expected to continue to play a significant role in the effort to reduce the water resources pressure of Beijing in the future. However, it should be noted that some of the expansion of the external WF of Beijing is to the surrounding areas of Hebei and other provinces which are also enduring water stress. Hence, Beijing’s shift to rely more on the external WF of Beijing may put further pressure on the water resources in these neighboring areas. 4.2. Determinants of the WF Changes. The decomposition results show that the technological effect was the principal contributor to offset Beijing’s WF increase (Figure 2). This coincides with the efforts of Beijing in developing and implementing water-saving technologies. For agriculture, the renovation of irrigation systems has been carried out to reduce water losses and increase the water use efficiency. Meanwhile, the water-saving oriented agronomic techniques, such as deep ploughing, soil moisture maintenance and conservation, selection of drought-resistant varieties, etc., have been widely promoted by the government. As a result, the ratio of crop water consumption (i.e., evapotranspiration) to the total water supply to the irrigation system has reached 0.68, about 40% higher than the national average level.40 For industries, Beijing has formed a water-saving mechanism characterized by technological enhancement, market incentives, water recycling and reuse, total amount control, etc. The volume of industrial water use for per value added dropped from 98 m3/104 Yuan to 19 m3/104 Yuan during 2001−2010, which is far ahead of other regions in China.40 The contribution of the structural effect in reducing the WF was relatively small, with 6% during 1997−2002 and 7% during 2002−2007. The effect was related to the changes in the demand patterns of the residents of Beijing. In general, with the income increase, the demand moves toward increasing the proportion of the products from the tertiary industries, that is, services and high-tech products which are generally less water intensive compared with the products in the primary and secondary industries. During the period observed, the proportion of the WF of the primary industry slightly decreased from 21% to 16%. The secondary industry decreased from 62% to 48%, while the tertiary industry experienced a remarkable increase from 17% to 36%. 12378

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available water resources in the future development planning. Importing VW can serve as a water supplement to alleviate Beijing’s water pressure, but controlling growth of internal WF might be more essential to the sustainable economic development and water uses of Beijing in the long run. To this end, moving some people together with services and jobs to the peripheral regions in Hebei would be one of the channels to reduce the internal water pressure of Beijing. This trend has been seen in recent years. Spatial arrangements between Beijing and the adjacent regions in Hebei have been under negotiation to provide incentives to firms and people to move to the peripheral regions.44 Much more effort is needed for infrastructure construction and for removing administrative barriers to facilitate the spatial integration between Beijing and the peripheral regions. Although the import of VW can serve as a water supplement to alleviate Beijing’s water pressure, the economic system efficiency with respect to the VW flows in the trade systems can deteriorate with the over expansion of trade. This is reflected by the positive effect of the economic system efficiency to the increase in Beijing’s WF. The expansion of Beijing’s dependence on the external water support therefore needs to pay attention to the improvement in the economic system efficiency associated with the use of internal and external water resources. Finally, we would like to mention that the expansion of the external WF shifts the burden of water demand of Beijing to other regions, some of which are enduring severe water scarcity. However, without a detailed investigation on the trade-offs of the shift and the benefits and costs incurred to the providers of Beijing’s external WF, one cannot conclude that the shift necessarily poses negative impacts on water scarce regions. For example, the increased demand for food products from Beijing may lead to an increase in farmers’ income in Hebei, whereas the total agricultural water use there may remain (which is likely because the potential to expand crop land and irrigation is very limited in Hebei). Also, the shift of industries to the surrounding areas may stimulate the upgrade of industries and improvement of technologies (relative to the existing levels in the destination regions). A comprehensive analysis of trade-offs of the shift is beyond the scope of this study. What is clear, however, is that an interregional coordination in water resources management is crucially important for Beijing’s long-term economic development. By providing the decomposition analysis of Beijing’s WF changes, this study sheds some lights on the areas where the future researches are needed.

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ASSOCIATED CONTENT

S Supporting Information *

Additional information include Table S1. This material is available free of charge via the Internet at http://pubs.acs.org.

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Article

AUTHOR INFORMATION

Corresponding Author

*Phone: +41 58 765 5568; fax: +41 58 765 5375; e-mail: hong. [email protected]. Notes

The authors declare no competing financial interest.

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ACKNOWLEDGMENTS 'This study was supported by the Grant of National Natural Science Foundation of China (No. 71173212). 12379

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Environmental Science & Technology

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