Assisting Chinese stakeholders in setting up investment fund for soil and water conservation

Middle Route for South-to-North Water Transfer from Danjiangkou Reservoir to Beijing

ISRIC has started to explore the feasibility of its Green Water Credits concept in China. The concept enables upstream farmers to practice soil and water conservation practices that generate benefits for downstream water users.

Shortage of fresh water is jeopardizing China’s rapid development, in particular in thirsty northern China. To tackle this challenge, the Chinese government is building a $62 billion South-to-North Water Transfer Project (which includes Eastern, Middle and Western routes) with new dams and canals. However, there is increasing pressure to safeguard the quantity and quality of the current water sources, and a financial mechanism between upstream water ‘creators’ and downstream water users is lacking. ISRIC has therefore started a new project to explore the feasibility of its Green Water Credits concept in China. The kick-off meeting took place in September in Wuhan .

Green Water Credits is an innovative investment mechanism that enables upstream farmers to practise soil and water management activities that generate benefits for downstream water users including drinking water and hydropower companies. Normally, the conservation practices of upstream farmers - such as mulching or terracing - are unrecognized and unrewarded by the downstream community. By setting up a system to reward these activities, and by performing cost-benefit and feasibility studies, farmers can better organize themselves for conservation practices on a regional scale.

The concept has already been proven in Kenya (by ISRIC and its cooperative partners) and is now being tested in the catchment area around the Danjiangkou Reservoir. The Chinese government plans to divert 10-12 billion cubic metres of water per year from the Yangtze River in southern China to the arid north of the country. The Middle Route Project (MRP) for South-to-North Water Transfer will divert water from the Danjiangkou Reservoir on the Han River, a tributary of Changjiang (Yangtze) River, to Beijing through canals. It is hoped that this new route – over 1400 km long – will mitigate the water resource crisis that Beijing, Tianjin and the North China Plain are facing. The route should increase the irrigated area by 0.6 million ha, and deliver 6.4 billion cubic metres of water to the municipal and industrial water supply and 3.0 billion cubic metres for agriculture, for Beijing, Tianjin, Hebei and Henan provinces. The route is also intended to bring improvements to the environment and boost economic development in China.

To finance soil and water conservation practices, the Chinese government is formulating a legal framework for watershed eco-compensation and international, payments for environmental services. The government also wants clarification of the property rights of stakeholders, particularly those of upstream and downstream users in river basins. The Green Water Credits initiative for China could test the legal framework.In addition, feasibility studies would place the plans in a local context.

ISRIC will coordinate the project, and will work closely with a Dutch consortium (consisting of FutureWater and Nelen & Schuumans) to train Chinese partners. The partners will execute feasibility studies jointly with the Chinese partners Changjiang Water Resources Protection Institute of the Changjiang (Yangtze River) Commission and Huazhong Agricultural University. For more information, please contact Dr Zhanguo Bai.

ISRIC – World Soil Information,
P.O. Box 353,
6700 AJ, Wageningen, The Netherlands.
Tel: +31 317 483692;