This study analyzes the water treatment market in China in terms of products and markets. Major products include chemicals as well as nonchemical equipment and supplies. Many types of conventional water supply equipment -- such as pumps, valves, hoses and compressors -- are not included, nor are products designed primarily to dispense water in residential, commercial or institutional settings. Markets include municipal, industrial (chemical and pharmaceutical processing, electric power generation, electronics, food and beverage processing, petroleum, pulp and paper, other), and residential and commercial. All of the national market statistics presented exclude water treatment in Hong Kong and Macau, even though these special administrative regions formally became part of the People’s Republic of China during the late 1990s -- Hong Kong in 1997 and Macau in 1999. Taiwan, which is economically independent from the rest of China and not under the administration of the central government, is excluded from the scope of this study as well.

INTRODUCTION viii

I. EXECUTIVE SUMMARY 1

II. MARKET ENVIRONMENT 4
General 4
Economic Overview 5
Demographic Overview 8
Population 8
Urbanization 11
Households 11
Industrialization & Manufacturing Trends 12
Personal Income Trends 14
The Eleventh Five-Year Plan 16
Water Use 18
International Activity & Foreign Trade 20

III. MARKETS 22
General 22
Industrial 24
Pulp & Paper 26
Food & Beverage Processing 32
Electric Power Generation 38
Petroleum 43
Metals 48
Electronics 53
Chemicals & Pharmaceuticals 55
Other 61
Municipal 65
Municipal Water Supply 67
Municipal Wastewater Treatment 70
Residential & Commercial 73

IV. PRODUCTS 76
General 76
Chemical 79
Corrosion Inhibitors 82
Coagulants & Flocculants 86
Oxidizers & Biocides 90
pH Adjusters & Softeners 99
Other 104
Defoamers 105
Chelating Agents 107
Nonchemical 110
Filtration & Separation 112
Equipment & Systems 113
Consumables 126
Disinfection 138
Ultraviolet (UV) Equipment 140
Ozone Equipment 142
Other 144
Other Equipment 145

V. INDUSTRY STRUCTURE 148
General 148
Market Share 151
Industry Composition & Restructuring 153
Competitive Strategies 156
Marketing & Distribution 158
Cooperative Agreements 159
Company Profiles 162
Aquious, see ITT Industries Incorporated
Arch Chemicals Incorporated 163
Ashland Incorporated 165
Bayer AG 168
BioLab Water Additives, see Chemtura Corporation
Buckman Laboratories Incorporated 169
Calgon Carbon Corporation 171
Changzhou Qingliu Water Treatment Chemicals Company Limited 174
ChemTreat Incorporated 175
Chemtura Corporation 177
Christ Water Technology AG 179
Ciba Specialty Chemicals Holding Incorporated 181
CUNO Incorporated, see 3M Company
Cytec Industries Incorporated 183
Davco Products, see Siemens
Davis Process Products and Services, see Siemens
Dow Chemical Company 184
Drew Ameroid Singapore Pte Limited, see Ashland
Ebara Corporation 188
Envirex Products, see Siemens
FilmTec Corporation, see Dow Chemical
GE Water & Process Technologies, see General Electric
General Electric Company 190
General Filter Products, see Siemens
Hercules Incorporated 196
HTH Water Products, see Arch Chemicals
Hydranautics, see Nitto Denko
Ionics Incorporated, see General Electric
ITT Industries Incorporated 198
Kemira Oyj 201
Kemwater Yixing Company Limited, see Kemira
Kurita Water Industries Limited 202
LANXESS AG 204
Memcor Products, see Siemens
Microfloc Products, see Siemens
Monosep Corporation, see Siemens
Nalco Holdings LLC 207
Nanjing Clear Environment Protection Company Limited, see Ashland
Nitto Denko Corporation 210
Occidental Petroleum Corporation 212
Pall Corporation 214
Rohm and Haas Company 217
Sanitaire, see ITT Industries
Severn Trent plc 220
Shanghai Duojia Water Treatment Science & Technology Corporation 223
Siemens AG 224
SNF Floerger SAS 230
3M Company 231
USFilter Corporation, see Siemens
Veolia Environnement 234
WEDECO AG Water Technology, see ITT Industries
Westates Carbon, see Siemens
Wujin Fine Chemical Factory 237
Zibo Water Purification Agent Factory 238
Zimpro Systems, see Siemens

LIST OF TABLES
TABLE NUMBER PAGE
SECTION I -- EXECUTIVE SUMMARY
Summary Table 3

SECTION II -- MARKET ENVIRONMENT
1 Gross Domestic Product of China 8
2 Population of China 10
3 Households in China by Region 12
4 Manufacturing Overview 14
5 Per Capita GDP in China by Region 16
6 Water Withdrawal in China 20

SECTION III -- MARKETS
1 Water Treatment Markets in China 23
2 Industrial Water Treatment Markets in China 25
3 Pulp & Paper Market for Water Treatment in China 28
4 Food & Beverage Processing Market for Water Treatment in China 34
5 Electric Power Generation Market for Water Treatment in China 40
6 Petroleum Market for Water Treatment in China 45
7 Metals Processing Market for Water Treatment in China 49
8 Electronics Market for Water Treatment in China 55
9 Chemical & Pharmaceutical Market for Water Treatment in China 57
10 Other Industrial Markets for Water Treatment in China 62
11 Municipal Water Treatment Market in China 67
12 Municipal Supply Market for Water Treatment in China 70
13 Municipal Wastewater Treatment Market in China 73
14 Residential & Commercial Water Treatment Market in China 75

SECTION IV -- PRODUCTS
1 Water Treatment Demand in China by Type 79
2 Water Treatment Chemical Demand in China by Type 81
3 Corrosion Inhibitor Demand in Water Treatment in China 84
4 Coagulant & Flocculant Demand in Water Treatment in China 89
5 Oxidizer & Biocide Demand in Water Treatment in China 92
6 pH Adjuster & Softener Demand in Water Treatment in China 103

7 Other Water Treatment Chemical Demand in China 105
8 Nonchemical Water Treatment Demand in China 111
9 Nonchemical Separation & Filtration Equipment & Supplies Demand in Water Treatment in China 113
10 Nonchemical Separation & Filtration Equipment Demand in Water Treatment in China 114
11 Conventional Water Treatment Filtration System Demand in China 118
12 Deionization System Demand in Water Treatment in China 120
13 Membrane Separation System Demand in Water Treatment in China 124
14 Distillation System Demand in Water Treatment in China 126
15 Filtration & Separation Consumable Demand in Water Treatment in China 127
16 Water Treatment Membrane Demand in China 130
17 Water Treatment Filter Demand in China 132
18 Ion Exchange Resin Demand in Water Treatment in China 134
19 Activated Carbon Demand in Water Treatment in China 136
20 Other Filtration & Separation Consumable Demand in Water Treatment in China 137
21 Disinfection Equipment Demand in Water Treatment in China 140
22 Ultraviolet (UV) Disinfection Equipment Demand in Water Treatment in China 142
23 Ozone Generating Equipment Demand in Water Treatment in China 144
24 Other Disinfection Equipment Demand in Water Treatment in China 145
25 Other Nonchemical Water Treatment Equipment Demand in China 147

SECTION V -- INDUSTRY STRUCTURE
1 Water Treatment Product Sales by Company, 2005 149
2 Selected Acquisitions & Divestitures 155
3 Selected Cooperative Agreements 161

LIST OF CHARTS
CHART NUMBER PAGE
SECTION II -- MARKET ENVIRONMENT
1 Population of China by Age 10

SECTION III -- MARKETS
1 Water Treatment Markets in China, 2005 23
2 Industrial Water Treatment Markets in China, 2005 26

SECTION IV -- PRODUCTS
1 Water Treatment Chemical Demand in China, 2005 81

SECTION V -- INDUSTRY STRUCTURE
1 Water Treatment Product Market Share in China, 2005 152