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ADB Lends China $240 Million for Wastewater Reuse

MANILA, Philippines

The Asian Development Bank announced this week that it will support China’s efforts to improve its wastewater management and reuse with a $240 million USD private sector loan package to Hong Kong-listed water supply and sewage treatment company Beijing Enterprises Water Group Limited (BEWG).

China’s fast-growing economy, large population and rapid urbanization have created a number of water-related challenges for the country. Four hundred Chinese cities are reporting water shortages. There is an average daily shortfall of 16 million cubic meters, the equivalent of the average annual consumption of 160,000 people.

Water pollution is placing further pressure on availability of freshwater. Much of the country’s surface water and groundwater have been found to be too polluted to meet drinking water quality standards.

“Improving wastewater treatment quality is the effective response to the challenges that the PRC (People’s Republic of China) faces,” said Hisaka Kimura, principal investment specialist at the ADB’s Private Sector Operations Department. “With adequate technologies, wastewater can be treated to meet specific needs and purposes, such as industry use, including machine cooling, cleansing, and boiler operation. Higher quality freshwater can be freed up for end uses such as drinking and cooking.”

BEWG will use the financing to upgrade existing water treatment plants, with the goal of increasing wastewater treatment by 600 million tons a year by 2019. The plants will be improved to meet grade 1A standards, which means the water can then be reused for industry cooling and city gardens.

The $240 million USD will come in two tranches – a $120 million USD directly from the ADB to BEWG and its subsidiary BEWG Environmental Group Company Limited, and a complementary loan of $120 million USD, funded by commercial banks.

An additional $500,000 USD in assistance will be provided jointly from the ADB’s Climate Change Fund and the Multi-Donor Trust Fund under the Water Financing Partnership Facility, which is funded by the governments of Australia, Austria, Norway, Spain and Switzerland. These funds will be used to promote wastewater reuse in cities across China, the ADB said.

Earlier this year, the International Finance Corporation (IFC) provided a $70 million USD loan to China Everbright International to build three water facilities, including a wastewater treatment plant, a pioneering wastewater reuse plant and a groundwater plant.

Upon completion the first plant will treat 150,000 cubic meters of wastewater per day, while the second plant will recycle 20,000 cubic meters of water a day. 

This story is brought to readers free in association with Singapore International Water Week.