Practices and reflections on investment and financing mechanisms for the construction of national water networks

Wu Youhong; Qin Juntao

doi:10.3969/j.issn.1000-1123.2024.17.018

Abstract：The task of building the national water network is extensive,with significant funding requirements.It is imperative to harness the synergy between an effective market and a proactive government,deepen the reform and innovation of the investment and financing mechanisms,break the bottlenecks,and establish a diversified framework for investment and financing entities driven by government-market collaboration.This paper analyzes the current state of national water network construction and its investment and financing,identifying the difficulty in raising construction funds as a key constraint.Presently,the guiding policies for national water network construction focus on maximizing the issuance of treasury bonds and local government special bonds,attracting social capital in compliance with laws and regulations,and actively seeking financial support for water projects.In light of the challenges and issues in the current investment and financing landscape of the national water network construction,several suggestions are put forward:establishing a diversified framework for investment and financing entities driven by government-market collaboration,making full use of fiscal support policies,promoting innovative water financing models tailored to local conditions,actively exploring an integrated model for investment,construction,management,and operation,establishing a water pricing mechanism aligned with the reform of the investment and financing systems,advancing the issuance of real estate investment trusts(REITs)in the water sector,and promoting water economy development while piloting water-security-guarantee oriented development(WOD)models.