Foreign companies are buying into the Chinese water treatment market,
after the country vowed to invest 430 billion yuan (US$63 billion) in
the sector during the 12th Five-Year Plan period (2011-15).
Dow Water & Process Solutions
announced in June that it will build a new world-class reverse osmosis
membrane plant at the company's site in Huzhou city, in East China's
Zhejiang province.
It would be the first production base
for reverse osmosis membranes outside the United States, said Ian
Barbor, general manager of Dow Water. The advanced technology is widely
used in water and wastewater purification and has already been adopted
by several programs in China.
"China continues to be the largest
growth market for reverse osmosis," said Wang Xiaolan, Asia-Pacific
commercial director of Dow Water.
China is adopting a new national
standard for drinking water this month and also plans to raise the
standard for wastewater discharge. The nation's determination to improve
its water quality will boost our business, she said. According to the
five-year plan for sewage treatment, China aims to improve its rate of
treating wastewater to 85 percent in urban areas, 70 percent in
county-level cities and counties and 30 percent in towns by 2015.
In addition to its 430 billion yuan
investment, the government is also encouraging non-public finance in the
sector, a move that has attracted companies all over the world because
of the promising business opportunities.
"We are very excited by the potential of
the Chinese market due to several trends that put it first in the
world," said Serge Ajamian, regional manager Asia-Pacific of JIE
Technologies, a Canada-based water treatment company that focuses on
potable water solutions.
He pointed out that China is undergoing
the greatest urbanization the world has ever seen. The new middle
classes consume more water than previous generations. China, which has a
shortage of water, will need to find ways to conserve the essential
resource. The next trend is the increasing sophistication of the Chinese
consumer in wanting a cleaner environment in all aspects. This bodes
well for high quality products that can safely deal with water issues
commonly found in China.
"Foreign companies have at least 95
percent of the market share in the household water purifier sector. They
are now entering the wastewater treatment market," said Professor Wu, a
Chinese expert in water treatment, who declined to give his full name.
Wu runs a membrane technology company
himself. "They (foreign companies) are much more experienced - and
Chinese authorities trust them," he said, adding that Chinese companies
find the going tough because the price they offer is not much lower than
foreign rivals and they do not have much experience in handling large
projects.
Guo Zhihong, deputy director of the
safety and environmental protection department at Sinopec Shanghai
Petrochemical Co, agreed with Wu.
"We use membranes provided by US and Japanese companies to achieve high-purity water," he said.
His company treats more than 100,000
tons of wastewater every day, most of it undergoing biological
treatment, at a cost of about 1 to 2 yuan a ton.
A small amount of the wastewater will undergo membrane treatment for industrial consumption at a cost of 7 to 8 yuan a ton.
"The quality of products provided by Chinese companies is not as good as foreign ones," he said.
The use of membranes to treat wastewater
is very limited nowadays, because it costs so much. However, the
potential in the market is huge because the standard for wastewater
discharge will be raised and the cost of this technology will be brought
down, Wu said.
Compared with other emerging markets such as India, China is more willing to spend money in the water treatment sector, said Wu.
More than 6.4 million cubic meters of
sewage are discharged in Hangzhou Bay, the East China Sea and rivers in
Shanghai every day, said Tang Jianguo, a senior engineer with Shanghai
Water Authority.
Although the water quality is above the national standard, the authority still wants to further improve it.
"We require both reliable technology and
an affordable price for water treatment," Tang said, adding that
foreign companies have obvious advantages in key technologies for water
treatment.
It shocked the nation when statistics
from the Ministry of Environmental Protection found underground water in
57 percent of monitored sites across Chinese cities was found to be
polluted or extremely polluted. Ground water is generally lightly
polluted.
More than 65 billion tons of wastewater
were discharged last year, said the ministry but little is fully treated
before going into the rivers and sea.
"A big problem is that although China's
national standards for sewage discharge are high, some companies do not
obey the rules," Tang said.
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