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By Elizabeth Economy, World Politics Review

What is the biggest challenge that China faces?

Corruption, the gap between the rich and poor, and the rapidly aging population often top the list of answers to this question.

Yet a closer look suggests that the greatest threat may well be lack of access to clean water. From "cancer villages" to violent protests to rising food prices, diminishing water supplies are exerting a profound and harmful effect on the Chinese people as well as on the country's capacity to continue to prosper economically.

While much of the challenge remains within China, spillover effects - such as the rerouting of transnational rivers and a push to acquire arable land abroad - are also being felt well outside the country's borders.

China's leaders have acknowledged the severity of the challenge and have adopted a number of policies to address their growing crisis. However, their efforts have fallen woefully short, as they fail to include the fundamental reforms necessary to turn the situation around. Meanwhile domestic pressures, as well as international concerns, continue to mount.

Development Run Amok

China's water story begins with a challenging reality: The country's per capita water resources just exceeded more than one-quarter that of the world average, and the distribution of those resources throughout the country is highly uneven.

Northern China is home to approximately 40 percent of the country's total population and almost half its agricultural land, and produces more than 50 percent of GDP. But it receives only 12 percent of total precipitation. Southern China, in contrast, receives 80 percent of China's total precipitation, yet skyrocketing levels of water pollution dramatically reduce the south's natural advantage.

The spectacular economic growth that has made China the envy of the world has only exacerbated the challenge. Resources, particularly water, are consumed without consideration for future demand. Industry and agriculture are notoriously profligate water consumers: Industry, which accounts for about one-quarter of China's total water consumption, uses anywhere from four to 10 times more water per unit of GDP as other competitive economies.

Water used for energy is a singularly important drain on China's scarce resources. By far, the largest portion of China's industrial water use is devoted to energy: The process of mining, processing and consuming coal alone accounts for almost 20 percent of all water consumed nationally.

Hydropower raises the bar even further. Already the largest producer of hydropower in the world, China plans to triple hydropower capacity by 2020. According to Ma Jun, the director of the Chinese NGO Institute of Public and Environmental Affairs, many Chinese rivers simply won't be running in 2020 if China meets its hydropower capacity goals.

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Agriculture, which accounts for 62 percent of China's total water consumption, also takes a serious toll on China's water supply. Almost two-thirds of China's arable land lies in the perennially dry north, and irrigation practices in China continue to be inefficient, with less than half of the water used for irrigation actually reaching crops.

Even municipalities suffer from serious water wastage: About 20 percent of urban water consumption is lost through leaky pipes. China's goal of urbanizing 400 million people by 2030 means that the water challenge will likely only increase. Urban, middle class residents - with water-consuming appliances, homes with lawns to water and a fondness for golf courses - use 300 percent more water than their rural counterparts.

China's widespread pollution adds another dimension to the country's water crisis. More than 90 percent of southern China's water withdrawal comes from surface water, but in the first half of 2010, almost a quarter of China's surface water was so polluted that it was not even usable for industry, and less than half of the total supplies of water were found to be drinkable. For decades, factories and municipalities have dumped untreated waste directly into streams, rivers and coastal waters.

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The Shifting Landscape

China's economic growth, inefficiencies and wastage in water usage are transforming the geography and resource base of the country. First, the sheer amount of available water is declining. During the period from 2000 to 2009, the amount of accessible water in China decreased by 13 percent. By 2030, the Ministry of Water Resources anticipates that per capita water resources will decline below the World Bank's scarcity levels. Northern China reports some of the highest rates of water loss in the world.

Moreover, according to China's Minister of Water Resources Chen Lei, two-thirds of Chinese cities face increased scarcity of water, and overall the country confronts a water shortage of 40 billion cubic meters annually. In rural China, 320 million people - one-quarter of China's total population - don't have access to safe drinking water.

Second, the country is sinking. The extensive contamination of surface water has forced the Chinese to increase their exploitation of groundwater, leading to groundwater depletion and a dramatic drop in the ground water tables: 100 to 300 meters in Beijing, and up to 90 meters in other parts of China.

In Beijing, land subsidence resulting from this groundwater depletion has destroyed factories, buildings and underground pipelines. Saltwater intrusion as well as pollution is further compromising the diminishing groundwater supplies: Of the 182 cities with monitored groundwater in 2010, more than half registered "poor" to "extremely poor" in water quality. Even China's Ministry of Environmental Protection was forced to acknowledge, "It is not easy to be optimistic about the quality" of the groundwater.

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Finally, desertification is advancing. While the south is often faced with catastrophic floods, desertification of the north has become widespread: One Chinese official estimated that it would take 300 years to reverse the desertification of lands that has already taken place - the majority in areas bordering the North's Gobi Desert - due to overexploitation of environmental resources. Even as local officials fight to reverse the trend, the desert continues to expand at a rate of more than 1,060 square miles per year.

The Hidden Costs

What really concerns China's leaders, however, are the social, economic and political impacts of this growing scarcity. As China's Minister for the Environment Zhou Shengxian suggested on his agency's website, "The depletion, deterioration and exhaustion of resources and the worsening ecological environment have become bottlenecks and grave impediments to the nation's economic and social development."

For the Chinese people, the failure of local officials and factory managers to enforce environmental regulations translates into serious public health concerns, crop loss, poisoned fish and livestock, and a lack of water to run factories. For Chinese officials, the failure to protect the environment and provide adequate and safe water to their people is one of the chief causes of social unrest in the country and perhaps their greatest policy concern.

Read more at World Politics Review.

