The brightest waves in the 20-year reform of China

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20 years of China's water industry reform: those brilliant waves in the turbulent reform

40 years of great changes in the era of reform and opening up, 20 years of changes in the market-oriented reform pattern of the water industry... 2018 is destined to be an extraordinary year. On the occasion of the 20th anniversary of the reform of the water industry, China water will review with you the shining waves in the 20 years of drastic changes. Look forward to the future, think about gains and losses, and start a new journey. We also look forward to meeting with you at the 2018 Water Industry Strategy Forum on April to witness the change, analyze the overall picture of environmental protection reform in the new era, connect the future of industrial ecology, and carry out the reform to the end! This article is the second in a series of topics with the theme of "twenty years of China's water industry reform" specially planned by China water. Welcome to pay attention

this year is 2018, the first year of the 19th CPC National Congress, the 40th anniversary of reform and opening up, the 20-year market-oriented reform of the water industry, the implementation of environmental protection policies, and the key year for the decisive completion of a moderately prosperous society and the implementation of the 13th five year plan

in addition, 2018 has more meanings:

it has been nearly 10 years since the establishment of the gem and the capital connection of technology-based enterprises; It has been 10 years since zhongkecheng was incorporated into Beikong water

it has been 15 years since the market-oriented reform of water industry (2002 "opinions on promoting the market-oriented reform of municipal public utilities industry")

it has been 20 years since the industrialization reform of urban water supply (1998 "urban water supply price management measures")

it has been 25 years since the establishment of sound group; It has been 30 years since Jinzhou environment entered the Chinese market

it has been more than 40 years since deliman (a subsidiary of Suez) entered the Chinese environmental protection market

looking back, we can see that the government and enterprises have jointly explored and continuously promoted the development of the marketization of China's urban water industry. On the occasion of the 20th anniversary of the reform of the water industry, China water will review with you the shining waves in the 20 years of drastic changes. Look forward to the future, think about gains and losses, and start a new journey

the first stage


technological pull, foreign capital surging, feeling the stone across the river

for a long time, the government has been the protagonist of water industry construction, management and service. In this case, China's water industry shows some disadvantages, such as lagging behind in construction and not adapting to the development of urban modernization; The government is also gradually unable to meet the huge investment demand of the urban water industry

the implementation of "urban water supply price management measures different detection objects should have different detection flow charts" in September 1998 has triggered a profound and long-term change in the urban water industry. In the late 1990s, China's urban water industry began the exploration process represented by a large number of BOT (construction operation transfer) methods, which first explored the property right field of urban water industry. In the process of deepening the reform, the investment link has gradually shifted from the government to enterprises

in this process, the actual owner of the project is absent, and the design institute replaces the owner, which not only affects the choice of technology and equipment, but also represents the development direction of urban water industry. During this period, the urban water industry was a technology LED industry, and almost all the core topics discussed in the industry were technology

foreign funded enterprises that have laid out China's water industry market early have become the main force of the market. As environmental problems have been treated in developed countries for many years, many available technologies and typical cases have been accumulated internationally. With the influx of foreign capital into the Chinese market, these environmental protection technologies have contributed a lot of experience and thinking to the initial environmental governance. Veolia Water (called Vivendi before 2002), Suez water (including its Sino French water), Berlin water and times water raised the market flag, and the first wave of local enterprises - Xiaoqing environmental protection, sound group, capital shares, Tianjin entrepreneurial environmental protection, Guozhen environmental protection, etc. began to accumulate strength. During this period, the first batch of classic water industry projects with important historical significance emerged:

Chengdu sixth water plant B project: this project is the first water supply BOT project in China. In 1997, the Chengdu municipal government launched the Chengdu No.6 water plant B project. On the one hand, it introduced funds to solve the capital shortage of infrastructure, and on the other hand, it introduced international technology and management to improve the efficiency and quality of water supply. In July, 1998, the government initialed the project franchise agreement and relevant annexes with the winning consortium of Veolia Water and Marubeni, with a franchise period of 18 years from the official effective date of the franchise agreement. In August 2017, the project cooperation expired, and the project company Chengdu general Marubeni water supply company officially handed over the project to Chengdu Xingrong group

Sewage Treatment BOT project in Beijing Economic and Technological Development Zone: in September 2000, American Jinzhou (holding) Group Co., Ltd. and Beijing Economic and technological investment and Development Corporation invested 31.58 million yuan in the construction and operation of the sewage treatment plant in the development zone to establish a Sino foreign cooperative enterprise -- Beijing Jinyuan economic and Technological Development sewage treatment Co., Ltd. After more than a dozen bidders participated in the bidding process, Beijing Construction Engineering Jinyuan Environmental Protection Engineering Co., Ltd. won the bid and obtained the general contracting right of the construction project. In March, 2001, the first phase of the project with a daily processing capacity of 20000 tons officially broke ground. It was completed at the end of October of that year. It passed the acceptance of Beijing Municipal Quality Supervision Station in December of the same year

Beijing Xiaojiahe Sewage Treatment BOT project: in 1999, sound put forward the "China clear water plan" to guide the BOT operation mode. Xiaojiahe sewage treatment plant is one of the typical cases of sound's "China clear water plan", and it is also the first municipal sewage treatment project invested and constructed by private capital in China. The sewage treatment plant was completed in 2002, and was completed and put into use in January 2003. In November, 2013, Xiaojiahe sewage treatment plant began to upgrade and transform, increasing the daily treatment capacity from 20000 tons to 80000 tons, and the effluent quality after transformation was raised to the B standard of Beijing local standard

At the end of 2002, the Ministry of Construction issued the opinions on promoting the market-oriented reform of municipal public utilities. It is clear that the reform of urban water industry and the marketization of recommendation are the main direction. Starting from attracting investment, we will gradually standardize and expand market access and break the monopoly of regional industries. The document ends the debate over whether municipal utilities can be marketized for many years. After that, China's urban water industry reform entered the first year of marketization. After 2003, the Ministry of housing and urban rural development, as the competent department of urban water industry operation services, began to pay attention to and emphasize the issue of efficiency

with the deepening of reform, 2004 has become a new material for property rights reform of the water industry or a prominent problem restricted by strategic emerging industries. In the reform year, a series of normative policies were issued, such as water price reform policies, franchise management measures, investment system reform decisions, etc; 2005 has become the regulatory year of water industry reform: the market regulation of water industry has really been put on the government's work agenda, and the management system dominated by investment and construction has gradually formed

in the wave of market-oriented reform of the water industry, the original investment support with governments at all levels as a single main body is gradually overwhelmed, and a large amount of financial capital is also looking for exports. The property rights reform for traditional urban water industry enterprises launched in 2003 clarified the asset relationship between the government and enterprises in urban water industry, and also cleared the obstacles for social capital to acquire the property rights of traditional enterprises. Social capital began to get involved in the water industry through many listed companies or investment companies represented by capital shares. Especially after the financial crisis, capital markets pay more attention to strategic emerging industries

at the enterprise level, the adjustment of rules has changed the original competition pattern, and the pattern of four parts of the world is beginning to appear: the foreign-funded international water investment group, represented by Veolia and Sino French water, has begun to differentiate its strategy in China; The investment strategy of capital enterprises represented by capital shares and China environmental protection water is clearer; Traditional water enterprises, represented by Shenzhen water and Beijing Urban Drainage Group, began to seek growth in other places; Environmental engineering enterprises represented by Jinzhou holdings, Tsinghua Tongfang water, sound group and Anhui Guozhen have completed the link with the capital market

at this stage, there are many node events in the environmental industry, some of which are as follows:

in 2002, Veolia purchased 50% of the equity of Shanghai Pudong water supply company at a premium, with an asset of 700million and a transaction of 2billion. Create a precedent for premium acquisition of urban water industry. The cooperation period of the project is 50 years, and it only operates for two and a half years at the time of acquisition

in 2002, capital stock invested 90million yuan to establish Ma'anshan capital water Co., Ltd. with Ma'anshan water supply company, which has a water production capacity of 450000 tons/day. The project represents the leading investment mode determined after the first strategic transformation

in 2003, through the acquisition of St Yuanyi, sound group was backdoor listed as "state investment resources" (renamed Hejia resources in 2005), and signed sewage treatment contracts with nine urban areas in the form of BOT

In 2003, Veolia signed a 50 year municipal outsourcing service contract with Shenzhen water group. The following year, Shenzhen Water Group jointly transferred 45% of its equity to Veolia Water and capital

in 2007, Veolia Water invested 1.71 billion yuan to acquire 45% equity of Lanzhou Water Supply Group at a premium

in 2007, Jinzhou environment won 15 water projects, and its performance improved significantly

in 2008, Beikong water invested HK $1.371 billion to acquire 88.4% of the equity of zhongkecheng and introduce mixed ownership

in 2009, the gem was officially established, opening up capital channels for technology-based enterprises

the third stage

environmental protection was listed as a strategic emerging industry in the year

and the era of big capital accelerated

this period is the end of the Eleventh Five Year Plan and the beginning of the Twelfth Five year plan. Just like the macro-economy, the aftermath of the financial crisis is gradually gone. Affected by energy conservation and emission reduction, investment pull, water price adjustment and other factors, China's urban water industry has seen a new atmosphere

In September, 2010, the State Council issued the decision on accelerating the cultivation and development of strategic emerging industries, clearly choosing energy conservation and environmental protection as one of the strategic emerging industries. Driven by the national strategy that makes the experimental machine unable to operate normally, the concept of environmental service industry guides the industry to explore a new development model. Service equality has expanded the scope of water industry services, and the new market of urban water industry is rapidly expanding to cities and towns. During the "12th Five Year Plan" period, the control needs of ammonia nitrogen and nitrogen oxides and the cost control needs have made the upgrading, transformation and refined operation become the focus of the industry, and the technical level of sludge treatment and disposal and the refinement needs of operation management have also been put on the agenda. On the whole, strategic transformation, business model innovation, industrial chain expansion and listing and financing have become the keywords of the water industry market. The era of big capital is accelerating: more enterprises recognize the power of capital and begin to pay attention to capital docking. Environmental industrialists began to accept the baptism of finance, and the capital market quickly widened the development gap between enterprises. For example, Beikong water has stabilized its position as the king of the industry with the help of investment strategies, and the rapid development of bishuishui has attracted the attention of the industry

more well-known environmental protection enterprises are listed on the gem, and most small and medium-sized companies also introduce strategic investors; The reform of traditional water companies has been put on the agenda; Large water groups continue to expand; Central enterprises have also extended their reach into the water sector. In terms of market performance, foreign water giants represented by Veolia and Sino French water are still dormant in the market; The state-owned enterprises represented by Beikong water and capital holdings still lead the development direction of the water industry market by virtue of multiple advantages such as capital and market scale

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