ADB Supports Urban-Rural Integration to Boost Access to Safer Water in People's Republic of China

BEIJING, PRC – The Asian Development Bank (ADB) will help improve water access and quality in the People’s Republic of China (PRC) through a $200 million facility signed today with a private water supply company, China Water Affairs Group Limited (CWA).

Closing the rural water gap with cities is a priority for the PRC Government. Urban-rural integration initiative aims to rectify development imbalances between city and countryside.

About half of rural residents in the PRC lack household tap connections, relying instead on wells and other communal means of supply. Even in communities that do have tap connections, water is often below national quality standards. Municipal governments’ efforts to improve last-mile connections have been confronting high investment costs, especially in areas with lower population density.

“Private sector participation in integrated urban-rural water distribution is an effective way to reach out to the least reached,” said Hisaka Kimura, Principal Investment Specialist at ADB’s Private Sector Operations Department.

Under the project, CWA will extend urban water pipeline networks into semi-urban and rural communities to provide household connections to tap water 24 hours, 7 days per week. Customers will enjoy better water quality and more reliable access. CWA will also rehabilitate the existing water facilities to prevent leakage and secondary contamination during distribution.

“By improving water efficiency throughout distribution, the project will help conserve water—one of the most precious resources in the PRC’s growing economy,” added Kimura.

ADB’s support will comprise a direct A-loan of $100 million, denominated in US dollars and renminbi. The renminbi portion will use funds raised via ADB’s Panda bond as well as Dim Sum bond. ADB will also arrange a $100 million B-loan, under which ADB acts as the lender of record for commercial banks.