China was "facing a water crisis more severe and urgent than any other country in the world," Vice Minister of Construction Qiu Baoxing told a conference in Beijing on developing China's urban water supply.

The construction ministry is responsible for supplying water to residents.

"We've got to solve the problem before it is too late," warned Qiu, according to the China Daily.

China's water supply is too small for its huge population of 1.3 billion people.

Its per capita water availability is about a quarter of the world average and it is expected to get worse, partly due to falling groundwater tables, the report said.

In addition, among China's seven major rivers, five are seriously polluted.

Waste was also a major problem, as more than 20 percent of the water supply in China's cities are leaked out from the water pipe networks, Qian Yi, a professor of environmental engineering from Tsinghua University and the Chinese Academy of Engineering, was quoted as saying.

"Shortsightedness in economic development accompanied with environmental destruction is still widespread in China," Qian said.

Vice Minister Qiu said the government has stepped up efforts to save water in the past 20 years and plans to carry out a number of measures to ensure water quality and supply.

The urban wastewater treatment rate will be raised from the current 45.6 percent to 60 percent in five years, with major cities reaching 70 percent, Qiu said.

The Ministry of Construction will also work with the Ministry of Health to put together a new set of standards for drinking water.

Market mechanisms will meanwhile be introduced to the urban water industry, Qiu said, adding that the government welcomes foreign investment to bring in cutting-edge technologies and management methods.

"We must take precautionary measures before the urban water ecosystem collapses," Qiu said.

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