Four independent project entities are expected to soon be established to pave the way for full construction of the eastern and middle lines of China's ambitious south-to-north water diversion project.

The project was partly kicked off last December with more sections scheduled to be built by the end of this year.

The worsening water shortage in North China due to severe droughts has forced the government to fast-track the project, a senior official said yesterday at a Beijing symposium on the project's construction and management mechanism.

Zhang Jiyao, minister of the office of the project's commission under the State Council, said: "Designated project proprietors to be established by local authorities along the two lines will take full responsibilities for fund-raising, construction, operation management, loan repayment, insured value and appreciation of their projects and assets.''

The proprietors will also take responsibility for the consequent obligations of their projects, particularly regional water pollution control and protection of water resources, Zhang told the meeting, which was attended by officials from Jiangsu, Hubei, Shandong, Hebei and Henan provinces as well as Beijing and Tianjin municipalities.

Zhang made it clear that "they (project entities) will be set up as modern enterprises and separated from local governmental administration.''

According to Zhang, the State Council has agreed to set up the four project entities as designated limited companies.

They will be responsible for the eastern line section in Jiangsu and its trunk canals in Shandong; and the middle line in Danjiangkou, where a large reservoir is the water head of the line in Hubei Province and its trunk canal throughout Henan, Hebei, Beijing and Tianjin.

"Once they are put in place, they have to make ownership of the assets of the projects clear, deal with investments from central and local governments, bear responsibilities for their projects' quality-control and distribution of regional water resources,'' Zhang quoted a report released by the State Council.

Following the construction of two sections along the eastern line last year, China will kick off eight new subprojects in the first phase of the eastern and middle lines by the end of this year -- five for the eastern line and the rest on the middle line.

"A full launch of the construction of the two lines is urgent this year with the persistent drought in North China,'' Zhang said.

"Beijing is plagued by the worst water supply crisis since 1949, so are Tianjin and Hebei'' Zhang warned, indicating water in their lakes and reservoirs keeps decreasing despite regular rainfalls.

As a result, several emergency projects have been launched to alleviate water shortages in Beijing and Tianjin, experts say.

(China Daily November 6, 2003)