Pouring profits - Chinese water market
The Chinese water market is growing at a rapid pace. Experts from Roland Berger predict that the market will grow by 30% by 2015, especially in the commercial segment. This segment offers very good prospects for international players as well. By contrast, the municipal water sector remains the preserve of established players. However, despite the good development prospects, the business environment will remain tough for water utilities in China. Water tariffs are currently too low to cover utilities' operating costs and fund crucial infrastructure improvements.
These are the key findings of "Pouring Profits", the latest study in the think:act series of publications.
The Chinese market offers both domestic and international players considerable potential. As the country urbanizes, urban residential water usage is expected to increase by 3% annually. Water tariffs are also on the rise, which mainly benefits private-sector players in the municipal market.
There is also a lot of potential in the industrial segment, with water treatment processes increasingly being outsourced. In addition, the Chinese government's 12th Five Year Plan stipulates investment of RMB 700 billion in sewage treatment between now and 2016.