16 November 2012: The Asian Development Bank (ADB) has granted a US$250 million loan to the Government of China for the clean up of the heavily-polluted Chao Lake, in Anhui Province. Support to China will include an eco-compensation programme, and a water emissions trading system aimed at controlling sources of rural water pollution.

According to the ADB, Chao Lake is the fifth biggest lake in China, and a high priority polluted site. The loan will finance eight new wastewater treatment plants and a wastewater collection network to intercept sewage, currently flowing untreated into Chao Lake’s tributaries. The loan will also finance a solid waste collection and management system, as well as the construction of artificial wetlands and habitats to reduce excessive amounts of nutrients.

ADB underscores that the eco-compensation programme will provide incentives for farmers to replace chemical fertilizers with organic fertilizers, and will test water emissions trading among farmers and companies for the control of water pollution in Chao Lake. [ADB Press Release]