A Multi-regional Input–output Analysis of Domestic Virtual Water Trade and Provincial Water Footprint in China

Abstract

China's booming economy has brought increasing pressures on its water resources. The water scarcity problem in China is characterized by a mismatch between the spatial distributions of water resources, economic development and other primary factors of production, which leads to the separation of production and consumption of water-intensive products. In this paper, we quantify the scale and structure of virtual water trade and consumption-based water footprints at the provincial level in China based on a multi-regional input–output model. We found that virtual water withdrawals and consumption embodied in domestic trade amounts to 184 billion m³ and 101 billion m³ in 2007, respectively, which is equivalent to 38% and 39% of national total fresh water withdrawals and consumption, respectively. Virtual water trade embodied in domestic trade is about two times as much as virtual water embodied in China's international exports. Water footprint in all four municipalities, i.e., Beijing, Tianjin, Shanghai and Chongqing, depends heavily on virtual water inflow from other provinces. China has a north-to-south net VWT pattern which is roughly the opposite of the distribution of its water resources. In addition to water efficiency improvement measures, re-shaping the water-trade nexus can be a significant complementary tool to address local water scarcity problems.