Longwu Water Fund — Qingshan Village Watershed Trust (Zhejiang, China)

Longwu Reservoir, built in 1981, supplies drinking water to roughly 3,000–4,000 residents of Qingshan Village and neighbouring hamlets in Yuhang District, on the western edge of the Hangzhou metropolitan area in Zhejiang Province. Its upstream catchment — about 173 hectares, of which some 107 hectares are moso bamboo plantations — had suffered rising nitrogen and phosphorus levels since the 1980s as farmers used heavy fertiliser and pesticide applications to boost bamboo shoot yields.

In 2015 The Nature Conservancy (TNC), the Alibaba Foundation and Wanxiang Trust jointly established the Longwu Water Fund (also known as the Shanshui Water Fund) with an initial grant of 330,000 CNY — China's first water trust fund. Wanxiang Trust acts as legal trustee, using the fund to work with upstream bamboo farmers, local public-interest groups, NGOs and agricultural supply-chain partners to shift toward reduced-fertiliser, reduced-pesticide plantation management.

By 2018 the reservoir's water quality had risen from a grade usable only for industrial purposes to China's highest drinking-water classification (Class I), with total phosphorus and dissolved oxygen levels meeting national standards, and participating farmers reported higher incomes. The approach directly informed the follow-on Qiandao Lake Water Fund — China's first large-scale urban water fund — which channelled a further 4.02 million yuan into watershed protection and has trained more than 3,000 government officials, farmers and students; Qiandao Lake supplies part of the water for the roughly 21-million-person Hangzhou metropolitan area.

Both funds remain modest relative to China's national watershed eco-compensation schemes and depend on renewed philanthropic and corporate grants rather than a large recurring payment stream, and detailed public accounting of total funds disbursed since the initial grants is limited.

Read the full analysis: https://events.development.asia/materials/20161125/trust-funds-tool-protect-water-source-areas-case-study-longwu-zhejiang-province

Read the full analysis: https://events.development.asia/materials/20161125/trust-funds-tool-protect-water-source-areas-case-study-longwu-zhejiang-province