The Work Package 5 goes to Shiyang River Basin in Gansu Province that has a mature market of water rights. Back to 2013, it was the first time that the State Council set up the trading system of water rights in China. The Central Government and MWR have indorsed the application of this system. The trading system of Shiyang River Basin has a complete mechanism for water rights exchange. The case study can reveal a whole picture of the current water rights trading system and its lessons learnt regarding barriers, challenges and effective methods in the process of utilizing the system. The case and tour study would help policymakers from other provinces or river basins cognize the first-hand experiences and direct outcome/benefit of the market-based instrument, i.e. water use efficiency.
The Chinese Centre Government has kept promoting large application of the water rights market/trading system after its establishment. It can help address the challenge of water shortage in most provinces/regions suffered by drought.
Shiyang River Basin is a pioneer in this field. As early as in 2013, it set up water right trading system that is one of the first comers that applied the water trading system in China. It has implemented “the Integrated Restoration Plan of Shiyang River Basin” for four years. To date, Shiyang River Basin has a comprehensive system, including water right allocation, water use accounting, water price, water right trading agreement, and an online water right trading platform.
The case of water right market in Shiyang River Basin is a practical lesson to other provinces or basins for an overall knowledge of barriers and challenges in this regard, as well as the outcome and benefit of the market-oriented instrument.
·Experiences and lessons from the water right trading practices in Shiyang River Basin;
·Support to China’s strategy of building up the water right market and trading system;
·Optimal methods for water governance in China.