CHINA urban rural income invest WATER irrigatated meters sewage utilities infrastructure

Adoption of the “one household, one meter” policy to facilitate collection of water bills; How China manages its water resources, especially on a regional basis, will decide whether its current shortage will evolve into a full-blown crisis triggering widespread internal and external conflicts. Fortunately, for the world and their own benefit, China’s leaders do recognise that they can no longer delay resolution of the pressing issues, and have set up clear objectives to conserve and clean up its water – although the size of its territory, the magnitude of the problems and lack of co-operation from provincial leaders mean it may take longer than expected to achieve the intended results.

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AN OPPORTUNITY TO INVEST
IN THE CHINA WATER INDUSTRY
USA Public Listed Company. New China Ventures Ltd. (NCVL)
A Strategic Investment in Mainland China Water Industry

B16L, Cheng Ming Building
No. 2 Xi Zhi Men South Street,
Xicheng Dist., Beijing, China -100035
Phone: 011 86 536 2958418
Email: info@china-waterworks.com

Corporation NEW CHINA VENTURES Ltd partners unit price shareholders public company USA listed NASDAQ stock market symbol:NCVL HOW WTO MEMBERSHIP AFFECTS CHINA. WTO membership will inextricably link China to the global economic community, eventually bringing with it more employment & investment opportunities, Investing in China - The Emerging Venture Capital Market, investment in mainland China start-up company. Traditionally, the water systems were run by state-owned municipalities, which were indifferent to profit and efficiency. In fact, most preferred to lose money, for if they made money, they would lose whatever state subsidies they got, and then had to start paying taxes. Years of neglect and under-investment in infrastructure led to poor maintenance of the pipelines. This raised the level of China’s water leakage – actual physical water leakage as well as inaccurate meters which led to non- or under-payment of water bills. China’s leakage is 21%, compared with 12% in developed countries.

CHINA'S LIVING STANDARD - URBAN & RURAL

     In the past two decades, the income of both urban & rural residents doubled. In 1997, savings deposits of urban & rural residents reached 4,628 billion yuan, over 218 times that of 1978 with an average annual increase rate of 32.8 percent. Plus foreign currency savings, debentures and stocks, the amount of financial assets owned by urban & rural residents had exceeded 6 trillion yuan. In 1997, total retail sales of consumer goods reached 2.7299 trillion yuan, over 20 times that 1978 in real terms. The residents' consumption level increased from 184 yuan in 1978 to 2,677 yuan with an annual increase rate of 7.8 percent if calculated by comparable prices. The pattern of consumption underwent positive changes--the Engel Coefficient of both urban and rural population lowered by 11 and 12.6 percentage points respectively.
     The average living space for urban residents increased from 3.5 square meters in 1978 to 8.8 square meters in 1997. The residents can afford more and more durable goods. The so-called "three major articles"--bicycles, wrist watches and sewing machines are renewed every few years. In the recent years, part of urban residents had turned their focus of consumption to personal computers, automobiles & housing. In 1998, the standard of living of both urban and rural residents continued to improve. The average per capita net income of rural residents rose by 4.3 percent over the previous year in real terms taking into consideration price drops; the average per capita disposable income of city & town dwellers increased by 5.8 percent in real terms. The development and sales of affordable housing for people with low or medium incomes increased by a fairly large margin. There was improvement in infrastructure facilities in cities & environmental protection. The living conditions of both the urban & rural population improved during the year.

     From 1978 to 1997, nearly 100,000 reservoirs of different purposes were constructed with a total water storage of 500 billion cubic meters. 5,608 irrigated areas were added and the size of irrigated land came to 22.6 million hectares. New investment in capital construction resulted in an increase of coal-mining capacity by 380 million tons, oil-drilling capacity by 240 million tons, steel-making capacity by 18.84 million tons and power-generating capacity by 159 million kilowatts. At the same time, 1,226,000 kilometers of highway were constructed and the loading capacity of newly constructed (or extended) ports amounted to 460 million tons. From 1980 to 1997, main-track railway newly laid throughout the country increased by 17,000 kilometers.

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Meter installation. As part of its policy to encourage water conservation, China has made it a national policy for each household to install one water meter. This will help to detect water leakage – actual physical leakage and/or non-payment or under-payment of bills. Each electronic water meter costs about Rmb500, while the cost of installation is about Rmb150, throwing up a gross margin of 70%. Sewage treatment. NCVL will not take on stand-alone sewage treatment as it will be paid by the authorities, which often delay payment. Thus, the treatment fees tend to end up as “account receivables”. It does accept a sewage project if it is part of a bigger water supply package. In such a case, it collects the sewage treatment fee. It usually will be paid Rmb0.65 for treating each cubic metre of dirty water.