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'More funds for water projects'

'More funds for water projects'

Updated: 2012-03-16 07:11

By Diao Ying and Fu Jing in Marseilles, France (China Daily)

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Minister says favorable policies will encourage foreign firms to invest

China will offer a package of favorable policies to encourage the private sector to tap into the country's multi-billion-dollar water conservancy infrastructure construction sector, said Minister of Water Resources Chen Lei.

Both Chinese and overseas investors have pinned high hopes on obtaining stakes in hydro-power plant construction, flood-prevention projects and water-saving investment after Chen revealed that China will channel about $636 billion into the projects through 2020.

At the 6th World Water Forum, Chen said China will use foreign funds such as loans from the World Bank and foreign government loans for water conservancy infrastructure construction, and will also attract private investors by offering favorable policies in terms of land use and taxation in the water sector.

"China encourages enterprises and individuals to invest in water conservancy by means of sole proprietorship, equity joint ventures and joint-stock cooperative ventures," he said.

President of World Water Council Loic Fauchon said China is faced with environmental challenges after years of rapid urbanization and industrialization.

"China should balance well its economic development and ecological protection," said Fauchon.

Paul van Meel, team leader of the China-EU River Basin Management Program, said: "This creates opportunities for the innovative private sector both in China and Europe."

Van Meel said that so far there is no European private sector involvement in China's water conservancy infrastructure construction sector, but said that there should be opportunities in the future.

Many European private-sector companies specialize in water management, such as the planning of river basin management and flood control, according to Van Meel.

"They are well-trained, and they have expertise in different regions," he said.

Jani Saarinen, senior manager of Kemira, Finland's leading papermaking technology provider, said China's rapid industrialization has offered tremendous opportunities for his company, especially in the papermaking sector.

"We offer both water-saving and cleaner production solutions and the Chinese government already has strict environmental regulations in this sector," said Saarinen.

Sarrinen said his company has decided to cooperate with local universities and research organizations to make their solutions compatible with local businesses.

The government's initiative has also created business opportunities for Chinese companies expanding overseas.

Dayu Water-Saving Group Co Ltd, based in northwestern Gansu province, held a successful initial public offering in 2009 and has become the market leader in China's water-saving sector. The company also aims to expand in the international market.

"The European market has advanced technologies. Entering the international market will help us to bridge the technological gap as well as expand our market share," said Wang Dong, chairman of the company.

Sun Yue, former president of Beijing-based Sino-Hydro Cooperation Limited, said the company is very active in seeking cooperation, especially in Africa, Asia and South America.

"We are seeking to win more projects worldwide based on our experience in dam and hydro-power construction," said Sun, adding that the company has taken part in 300 projects in 70 countries.

The company's contract volume reached 130 billion yuan ($23.7 billion) last year, with nearly 40 percent of this from overseas business.

Sun added that the company is "also exploring cooperation opportunities such as mineral resources exploration overseas".

The investment has gone beyond infrastructure and water treatment projects. China Water and Power Press, which was responsible for exhibiting Chinese enterprises at the World Water Forum, is exploring the potential to set up a joint exhibition company with a Dutch exhibitor to help China's water-related companies showcase themselves worldwide.

"As we are restructuring our publishing house, we aim to expand our business," said Tang Xinhua, the publishing house's president. "And we expect to build up our strength through international cooperation."

As China has made rapid progress in hydropower plant construction and water management, Tang said the world has shown its desire to learn more from China. "So we plan to acquire a publishing house overseas and the first target should be in the US."

Contact the writers at diaoying@chinadaily.com.cn and fujing@chinadaily.com.cn

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