Assessment Of Virtual Water Scarcity Risk Integrating Water Quantity And Water Quality

Water is a fundamental natural and strategic economic resource.Water scarcity will constrain the sustainable development of a region and lead to a slowdown in its economic growth.In the context of economic integration,potential economic losses(i.e.,direct water scarcity risk)caused by local water scarcity can be transmitted to downstream economies through interregional trade.However,there are two aspects to be further explored in the current research of water scarcity risk.One is that the risk inducement factor only considers water quantity while ignoring water quality;the other is that the scope of risk influence only considers direct water scarcity risk in the local region.However,the indirect transmission process of direct water scarcity risk under the effect of supply chain(i.e.,virtual water scarcity risk)is ignored.Therefore,it is necessary to carry out virtual water scarcity risk with both water quantity and quality to provide more comprehensive information to investigate the impacts of water scarcity risk on the trading systems.To address the above issues,this study proposes to include water quality into direct water scarcity risk assessment,and constructs a virtual water scarcity risk assessment model based on water quantity and quality based on multi-regional input-output(MRIO)analysis method.The purpose of this study is to provide theoretical basis and technical support for controlling interregional water scarcity.Firstly,the concepts of blue water footprint and grey water footprint are introduced to describe the water use of each sector and the amounts of freshwater occupied by pollution.By comparing blue water footprint,grey water footprint,available water resources and total output of each sector,a direct water scarcity risk assessment method based on water quantity and quality is developed.Secondly,combined with the direct water scarcity risk assessment method and MRIO model,a virtual water scarcity risk assessment model is established to reveal virtual water scarcity risk transfer between regions and sectors.Finally,this study takes 31 regions in China in 2012 as examples to carry out an empirical study.By revealing the changes in the spatial and temporal distribution patterns of regions and sectors,and the shifting trend of virtual water scarcity risk before and after considering water quality,this study provides a comprehensive reference for China to mitigate water scarcity.The main results are as follows:(1)Coupled with water deprivation risk,water dependency and other indicators to measure the vulnerability of each sector to water constraints,we develop a direct water scarcity risk assessment method that considers water quantity and quality.The method aims to quantify the possible economic losses resulting from insufficient water quantity and inadequate water quality.The results show that the extent and severity of water scarcity increased after considering water quality,with the number of severe scarce regions increasing from 6 to 19.The direct integrated water scarcity risk(DIWSR)is 6 times higher than the direct quantity-induced water scarcity risk(DQWSR).Besides,the ranking of water scarcity risk of different regions and sectors shows significant changes.For example,the top five critical regions based on DIWSR results are Henan(406 billion yuan),Inner Mongolia,Shandong,Shanxi and Jiangsu,while the top five critical regions based on DQWSR results are Jiangsu(137 billion yuan),Hebei,Shandong,Ningxia and Shanghai.(2)Combined with direct water scarcity risk assessment method and MRIO analysis method,a virtual water scarcity risk assessment model is constructed to reveal the transmission mechanism of virtual water scarcity risk.The results show that the virtual integrated water scarcity risk(VIWSR)is nine times higher than the virtual water scarcity risk based on water quantity(VQWSR),indicating that pollution significantly exacerbates the impacts of DIWSR on China's trading system.The inclusion of water quality changes the interregional transfer pattern of virtual water scarcity risk in China.Unlike VQWSR flows from Central Coast and Northwest regions to North and Southern Coast regions,the VIWSR shifts mainly from Northwest and Central regions to Central Coast and Southern Coast regions.Specifically,based on the VIWSR results,it is found that Shan-Jiangsu,Inner Mongolia-Jiangsu and Henan-Shandong are the most critical interregional pairs related to virtual water scarcity risk.Taking Shannxi-Jiangsu as an example,the results show that due to the water scarcity in Shanxi,there is a potential indirect economic loss(36 billion yuan)in Jiangsu,which is located downstream of the supply chain.The results based on VQWSR underestimate the transmission process of virtual water scarcity risk among the above interregional pairs.(3)Based on the role of industrial chain,the direct water scarcity risk of regions and sectors will transcend geographical borders and lead to indirect water scarcity risk in distant regions.This cascade effect is further exacerbated when water quality is taken into account,leading to an increase in the direct and indirect water scarcity risk(i.e.,cumulative water scarcity risk)in the region.The results show that the cumulative water scarcity risk based on water quantity(CQWSR)is only 15% of the cumulative integrated water scarcity risk(CIWSR),indicating that ignoring water quality will lead to the underestimate of water scarcity risk in the whole supply chain.At the sector level,results based on CIWSR can identify critical sectors that are not identified by CQWSR-based results,such as the Petroleum refining and Chemical industry.At the regional level,the CIWSR values of all regions are 2 to 4 times of their corresponding DIWSR values.For example,the CIWSR of Henan is 3 times of its DIWSR.By incorporating water quality into the direct water scarcity risk assessment and focusing on the virtual water scarcity risk caused by interregional trade,we can comprehensively investigate the cascading effects of water scarcity risk on national trading systems and identify critical regions and sectors vulnerable to upstream risk.The study found that ignoring water quality underestimates the impacts of direct water scarcity risk on the entire trading system,and fails to comprehensively identify critical risk transmission.Therefore,this study further verifies the importance of including water quality into water scarcity risk assessment,and provides a more comprehensive insights into China's policy decisions on water scarcity mitigation.