Current Situation, Dilemmas and Measures to Improve Horizontal Ecological Compensation Coordination Mechanisms in River Basins

Abstract

Flowing water resources and relatively fixed regional segmentation form a governance problem. The essence of horizontal collaborative governance is the establishment of coordination and cooperation processes between different independent and decentralized stakeholders in order to solve cross-regional public problems. As a result, the process of collaborative governance involves a jagged relationship of rights and responsibilities. This study attempts to explore how to achieve cross-regional intergovernmental joint prevention and treatment, and build a coordinated governance mechanism for a whole river basin. Based on data sources including local statistical yearbooks, open data of ecological environment departments and policy texts, this paper performs a comparative analysis of the current water quality status of various major water bodies in China and the relevant domestic ecological compensation systems. Based on this analysis, the current water quality situation is not optimistic. In order to strengthen the ecological and environmental management of river basins, more than 40 relevant systems and implementation schemes of ecological compensation for river basins have been introduced from the central government to the local government level since 2016, and 13 cross-provincial agreements (schemes) on horizontal ecological compensation for river basins have been signed. By analyzing various data and more than 53 systems (programs), it becomes apparent there are some problems in the governance of aquatic environments of river basins in China. These problems include a lack of laws and regulations on ecological compensation, imperfect coordination mechanisms, a single compensation mode and insufficient amounts of compensation. Based on this, this study proposes that China’s cross-regional river basin ecological compensation and collaborative governance mechanisms should start with differential governance; explore a variety of horizontal ecological compensation methods according to local conditions; improve cross-regional river basin collaborative mechanisms, laws and regulations; build a new path of horizontal independent collaboration; broaden the channels of financial compensation; and comprehensively improve the level of regional linkages in the governance of river basins.

1. Introduction

1.1. International Research and Practice on the Coordination Mechanisms of River Basins Ecological Protection Compensation

Since the 1980s, many countries and regions have implemented a large number of ecological compensation practices to deal with water crises and water pollution, and have adopted a series of ecological compensation measures, aiming at protecting the water quality and water environments of river basins, improving the support for the environmental protectors of river basins, and achieving a balanced and coordinated development of regional economies and communities. The international compensation practices for cross-regional river basin ecological protection are mainly concerned with transnational lakes, transnational rivers, cross-regional rivers and so on.

Considering the research and practice of watershed ecological protection compensation coordination mechanisms in the international community, a mechanism for cross-border lakes is represented by the cooperation between the United States and Canada in the Great Lakes. The two countries took a series of measures for comprehensive coordinated governance, jointly signing the 1909 Boundary Waters Treaty, Great Lakes Charter, Ecosystem Charter, Great Lakes Water Quality Agreement and other agreements. Their cooperation has achieved remarkable results [1].

Among the research and practice of ecological protection coordination mechanisms for international rivers, the Rhine River Basin is a typical representative of successful cross-regional coordinated governance. Through the establishment of the International Commission for the Protection of the Rhine River, a cross-regional river basin management organization, the interests and demands of all countries in the river basin are coordinated in a unified way [2]. International agreements on trans-regional river basin governance (conventions) were formulated and improved, the supervision mechanisms of watershed governance have been perfected, and enterprises and the public have been encouraged to play a proactive role in watershed governance [3].

As for the research and practice of ecological protection coordination for cross-regional rivers, the cross-regional governance experience of the Murray-Darling River Basin in Australia is quite typical. Australia applied holistic governance for the basin, and established trans-district basin management agencies responsible for unified arrangement, communication and coordination of all water-related affairs in the basin [4]. In the meantime, it strengthened cross-regional cooperation among the administrative regions in the basin through coordination agreements and action plans; the country respected the laws of hydrological science and took multiple measures to achieve the comprehensive utilization and governance of water resources. Through the above efforts, considerable results in governance were achieved [5].

Generally speaking, the ecological compensation of river basins in developed countries can rely on comprehensive legal, financial and market mechanisms. They can adopt public transactions, private transactions, ecological designations and other forms of compensation payment that are transparent, open, free and flexible and which are supported by corresponding legal system guarantees and related policies. It ensures that the compensation work is carried out in a reasonable and orderly manner. In the process of carrying out horizontal ecological compensation, China can learn from these successful experiences and practices in other countries.

1.2. Research and Practice on Transverse Ecological Compensation in River Basins in China

In September 2021, the General Office of the Central Committee of the Communist Party of China and the General Office of the State Council jointly released a policy titled Opinions on Deepening the Reform of Ecological Protection Compensation System, pointing out that it is necessary to “implement a comprehensive compensation system involving vertical and horizontal compensation, promote benefit sharing between ecologically beneficial areas and protected areas, and improve the horizontal compensation pattern while increasing vertical compensation, highlighting vertical compensation priorities, and improving vertical compensation methods”. Clearly, horizontal ecological compensation in the (HECRB) has become a crucial compensation form that can effectively protect the ecological environment and is a significant institutional measure for advancing the construction of ecological society. HECRB refers to the ecological compensation mechanism in which local governments at the same level in the upstream and downstream of the same river basin coordinate and balance the interest relationships between the ecological protection areas and areas that are ecologically beneficiaries. This achieved through consultation and negotiation, fully mobilizing the support of the upstream area to strengthen ecological protection, and finally realizing the sharing of rights, interests and obligations. [6,7,8]. Concerning watershed ecological compensation practices in China, addressing the dilemma of HECRB is of great practical significance for establishing a long-term mechanism of ecological protection compensation, promoting the sustainable development of river basin economies and communities, enriching and developing the theoretical basis for local government coordinated governance, expanding the research field in which the synergy theory is applied and constructing an ecological society.

Considering the research and practice of watershed ecological protection compensation coordination mechanisms in China, scholars have proposed the concept of coordinated protection of ecological environments and “bounded administration, unbounded compensation” [9]. To establish a coordinated system of watershed ecological protection compensation organizations, attention should be given not only to the coordination in the mode between the government and the market, but also to the coordination between the agent, system, technology, resources, organizations and other aspects, and the most important of these is organization coordination [10,11]. Taking the Beijing-Tianjin-Hebei region as an example, some scholars put forward three practice paths, i.e., ecological economy coordination, ecological culture coordination and ecological environment coordination, for the coordinated development of ecological compensation in the Beijing-Tianjin-Hebei region and analyzed the shortcomings of each coordination path [12]. Some scholars presented the “higher level government-dominated” coordination path and “radiation-driven” coordination path to achieve horizontal coordination in cross-regional watershed ecological compensation by constructing a dynamic model that affects the horizontal coordination effect of cross-regional watershed ecological compensation and analyzing the data through fuzzy-set qualitative comparative analysis (FSQCA) [13].

At present, there are three main types of research on river basin ecological compensation. The first is the establishment of river basin ecological compensation mechanisms. From the perspective of compensation subjects, the reform of river basin ecological compensation policy should aim at establishing a diversified ecological compensation mechanism and form an ecological compensation model that couples government, markets and society [14] (Zheng Y.C. et al. 2019). From the perspective of compensation scope, river basin ecological compensation should be guided by the concept of shared development and build a holistic mechanism of upstream and downstream joint construction and sharing of development results [15] (Liu Z. et al. 2017). The second is the calculation of compensation standards. For different location compensation amounts, there are differential ecological compensation standard models based on replacement cost methods [16] (Geng X.Y. et al. 2018), and multi-level compensation models based on welfare economics and environmental economics, aiming at maximizing social utility and orienting the value of river basin ecological services [17] (Wang Y.Q. et al. 2019).

Overall, China is still in the exploratory stage in terms of theoretical research and practical application of the issue of river basin horizontal ecological compensation and has not really formed a theoretical system or a complete methodological framework for compensation. It should be noted that the key to ensuring the effectiveness of ecological compensation system is to realize cross-regional intergovernmental joint prevention and to control and build a coordinated governance mechanism for the whole basin. At present, few scholars pay attention to the process elements of the operation of the horizontal synergy mechanism of river basin ecological compensation, and there is a lack of in-depth research on the factors influencing the horizontal synergy effect, which directly affects the effectiveness of river basin ecological compensation mechanisms.

The purpose of this paper, based on international and domestic research on river basin ecological compensation, is to analyze the current situation of water quality of various types of major water bodies and the relevant domestic ecological compensation systems. Firstly, further understanding the current situation of water pollution in various river basins and important water bodies in China is essential. Secondly, it is necessary to sort out and analyze the 13 river basin management schemes that have been issued in order to explore the horizontal synergy effects of ecological compensation mechanisms on problems and their countermeasures. The highlight of this study is to explore the process elements that determine the effectiveness of horizontal coordination mechanisms of river basin ecological compensation.

2. Data and System Construction

2.1. Current Situation of the Wastewater Pollutant Discharge in China

According to the results of a survey conducted by the China Modern Ecological Development Index, in 2022, water pollution was rated as more serious than air pollution for the first time, scoring the highest with 42.5% of the respondents. In recent years, China’s water pollution has become increasingly serious. The national annual discharge of sewage is as high as 36 billion tons. Moreover, 70% of industrial wastewater and less than 10% of domestic sewage is treated discharge; the rest of the sewage is discharged untreated directly into rivers, lakes and seas. This results in serious deterioration of water quality; chemical oxygen demand, heavy metals, arsenic, cyanide, volatile phenol and so on are increasing. Of the 95,000 km of rivers in the country, 19,000 km have been polluted, and 5000 km have been seriously polluted. The Qingjiang River has become turbid, the turbid water has become smelly, and the fish and shrimp have disappeared, which is a very troubling development. Water pollution has become the biggest threat to urban and rural residents’ domestic water use. The pollution of water resources not only aggravates the shortage of available water resources in China, but also affects the production activities in urban and rural areas, impacts the daily life of residents, poses a serious threat to the health of people, and limits the sustainable development of the economy and society while causing huge economic losses.

According to data published in the China Ecological Environment Statistical Annual Report 2016–2020 issued on the website of the Ministry of Ecology and Environment, the four indicators of chemical oxygen demand, ammonia nitrogen emissions, total nitrogen emissions, and total phosphorus emissions in China’s wastewater pollutant discharge had been declining year by year in the period 2016–2019, yet 2020 saw a blowout of growth. Chemical oxygen demand and total phosphorus emissions were about five times the levels of 2019; ammonia nitrogen emissions were about two times those of 2019; total nitrogen emissions were about three times those of 2009. Only a small number of other pollution indicators decreased between 2016 and 2020 to about one-third. Chemical oxygen demand accounts for the highest proportion of all pollutants, reaching 25.648 million tons in 2020, 5.5 times the sum of all other pollutants (

Table 1. Changes in Wastewater Pollutant Discharge in China from 2016 to 2020 (Unit: 10,000 ton).

Year/Category	Chemical Oxygen Demand	Ammonia Nitrogen Discharge Amount	Total Nitrogen Emission	Total Phosphorus Emission	Other Contaminants
2020	2564.8 ↑	98.4 ↑	323.3 ↑	33.7 ↑	0.3734 ↓
2019	567.1	46.3	117.6	5.9	0.6293
2018	584.2	49.4	120.2	6.4	0.7158
2017	608.9	50.9	120.3	7.0	0.7639
2016	658.1	56.8	123.6	9.0	1.15994

). Taking the industrial sources of water pollution in 2020 as an example, it can be seen from the data in

Table 2. Discharge of Wastewater Pollutants by Industries in China in 2020 (Unit: 10,000 ton).

Categories	Textile Industry	Chemical Raw Materials and Chemical Products Manufacturing Industry	Agricultural and Sideline Food Processing Industry	Paper and Paper Products Industry	Food Manufacturing Industry	Wine, Beverage and Refined Tea Manufacturing	Other Industries
Chemical oxygen demand	14.0%	13.1%	12.7%	12.5%	-	-	47.8%
Ammonia nitrogen	9.3%	22.5%	11.6%	-	7.9%	-	49.2%
Total nitrogen	12.8%	20.9%	10.1%	6.9%			49.4%
Total phosphorus	9.0%	11.3%	26.2%			8.7%	44.8%

Note: The information is based on the relevant data of the annual statistical report of china’s ecological Environment 2016–2020 published on the website of the Ministry of Ecology and Environment, and the data for 2021 has not yet been published.

that the top four polluting industries are manufacturers of chemical raw materials and chemical products, the agricultural and sideline food processing industry, the textile industry and the paper and paper products industry. Chemical oxygen demand is a measure of organic pollution in water indicators; the greater the chemical oxygen demand, the more serious the organic pollution of water. Chemical oxygen demand results mainly from paper making, fruit juice and other industries producing industrial wastewater, from urban wastewater and from large-scale livestock and poultry breeding. The main sources of chemical oxygen demand are basically consistent with the sources of the top four pollutants discharged in 2020.

The main causes of water pollution are improper water use and discharge in life and production (including agriculture and industrial production). In terms of industrial wastewater pollution, some enterprises have seriously polluted water resources because of high treatment costs and the large investments necessary. Instead, they directly discharge industrial wastewater without treatment or discharge, without meeting the standards. Considering agricultural pollution, the irrational use of chemical fertilizers and pesticides causes soil pollution, destroys soil structure and soil ecosystems, and then destroys the ecological balance of nature. Runoff and seepage caused by precipitation bring nitrogen, phosphorus, pesticides in soil and organic wastes from pastures, and by-products of agricultural of processing plants into water bodies, which deteriorates water quality and causes their eutrophication. In terms of domestic sewage pollution, domestic sewage is generally very turbid, and biochemical oxygen demand is generally 300–700 mg/L. Domestic water consumption is large and its composition is complex. Domestic wastewater directly enters water bodies without treatment, causing serious pollution to aquatic environments. The fundamental reason for all water pollutants discharged directly into rivers and lakes without treatment lies in the absence of government supervision, inadequate enforcement of laws and lighter penalties for illegal sewage discharge, which makes these enterprises willing to take risks in order to maximize their benefits.

2.2. Main Indicators of Water Quality of Major Tributaries and Provincial Sections in Major Basins

According to the data in the China Ecological Environment Status Bulletin 2021 published on the website of the Ministry of Ecology and Environment in 2021, among the 3117 national surface water monitoring sections of the seven major basins of the Yangtze River, the Yellow River, the Pearl River, the Songhua River, the Huaihe River, the Haihe River and the Liaohe River, and the main rivers of Zhejiang and Fujian, the northwest rivers and the southwest rivers, the sections where the surface water quality reached Grades I, II and III accounted for 87.0%, an increase of 2.1% from 2020; those where the surface water quality was below Grade V accounted for 0.9%, a decrease of 0.8% from 2020. The main pollution indicators were chemical oxygen demand, permanganate index and total phosphorus [18]. The main indicators of water quality of the major tributaries and provincial sections in major basins and the changes compared with 2020 are shown in Table 2. It can be concluded from the data that all the indicators of water quality in 2021 are generally better than those in 2020, but the situation is still not optimistic based on the major tributaries, provincial sections and some basins with water at or above Grade III. Of the 60 detection data indicators in six categories of cross-regional provincial boundary sections, 17 showed a downward trend, 27 were flat, accounting for 73% of the total, and only 16 increased, accounting for 27% of the total. The main indicators of water quality at provincial boundary sections of major river basins and their changes compared with 2020 are shown in

Table 3. Main water quality indexes of main tributaries and provincial boundaries. Sections of major river basins in 2021 and their changes compared with 2020.

Water Body		Number of Section	Proportion (%)						Change from 2020 (%)
			Class I	Class II	Class Ⅲ	Class Ⅳ	Class Ⅴ	Inferior Class V	Class I	Class II	Class Ⅲ	Class Ⅳ	Class Ⅴ	Inferior Class V
Yangtze River Basin	Main Tributary Provincial Boundary Section	935	7.0	69.3	20.5	2.6	0.5	0.1	−0.3	0.1	1.4	−0.8	0	−0.4
Yellow River Basin		222	5.0	45.9	27.5	14.9	2.3	4.5	−0.8	−0.3	3.1	1.6	−2.1	−1.3
Pearl River Basin		180	11.1	73.9	11.1	2.8	0.6	0.6	1.1	−0.5	0.5	−0.5	−0.5	0
Songhua River Basin		155	0	21.3	46.5	24.5	5.8	1.9	0	1.9	−6.4	5.8	3.9	−5.2
Huaihe River Basin		182	1.6	16.5	59.9	20.9	1.1	0	1.1	−2.7	11.0	−6.0	−1.1	−2.2
Haihe River Basin		191	5.8	29.8	32.5	27.7	3.7	0.5	−3.2	4.3	9.6	−2.1	−5.9	−2.7
Liaohe River Basin		63	0	25.4	44.4	28.6	1.6	0	0	3.7	6.1	−0.8	−0.1	−1.7
main rivers of Zhejiang and Fujian		198	8.6	62.1	24.2	4.5	0.5	0	3.0	−1.0	−2.6	0.5	0	0
Northwest rivers		107	40.2	54.2	1.9	1.9	1.9	0	−2.3	4.2	−1.9	0	0	0
Southwest rivers		133	9.0	75.9	11.3	2.3	0	1.5	3.7	−6.1	1.5	0.8	0	0

Note: The data are collated from relevant data of the Bulletin on the State of China’s Ecological Environment in 2021 published on the website of the Ministry of Ecology and Environment.

. In Table 3, it can be seen that the water quality of Class I and Class II in different sections of the ten major river basins that meet the drinking water standards in 2021 does not show an entirely positive trend compared with that in 2020. Two indicators of Class I water quality are reduced, and four indicators are flat, accounting for 60% of the total. Five indicators of Class II water quality were reduced, and one index was flat, accounting for 60% of the total.

Additionally, the China Ecological Environment Status Bulletin 2021 indicates that, in terms of lakes (reservoirs), among the 210 important lakes (reservoirs) under water quality monitoring, the proportion whose water quality lay at or above Grades I, II and III was 72.9% in 2021, 0.9% lower than in 2020. The proportion below Grade V was 5.2%, the same as 2020. Of the 209 lakes (reservoirs) monitored for water quality, 10.5% were oligotrophic, a 5.2% increase from 2020. Mesotrophic lakes accounted for 62.2%, a 5.1% decrease from 2020. The eutrophic lakes accounted for 4.3%, which was the same as that in 2020. Some important large lakes, such as Taihu Lake, Dianchi Lake and Chaohu Lake, are slightly polluted. The main pollution indicators in lakes are total phosphorus, chemical oxygen demand and permanganate index.

The main pollution indicators were the total phosphorus, chemical oxygen demand and permanganate index [18]. As for groundwater, among the 1900 national groundwater environment quality assessment points monitored, those with water at or above Grade IV made up 79.4% in 2021, while those with water reaching Grade V accounted for 20.6%. The main indicators exceeding the standard were sulfate, chloride and sodium. When it comes to water ecology in key basins in 2021, the water ecology measures in the seven major basins were mainly evaluated as ‘medium’ and ‘good’. Among the 701 monitoring points, the proportion with water ecology in ‘excellent’ condition was 40.1%, 40.8% were evaluated as ‘medium’ and 19.1% as ‘poor’ or ‘very poor’ condition [18].

2.3. System Construction for Watershed Ecological Compensation

Confronted with the actual state of water environment pollution in China’s basins, the central government and local governments have formulated and promulgated a total of 41 relevant guiding policy documents on ecological protection compensation mechanisms since 2015, including 9 at the central level and 32 at the local level (Table 3). These are dedicated to improving the ecological environment and achieving the goal of “lucid waters and lush mountains are invaluable assets”. Except for Hong Kong, Macao and Taiwan, 32 provinces (autonomous regions and municipalities directly under the central government) in China have enacted relevant documents on ecological compensation, including 26 policy documents on a basin’s comprehensive ecological compensation and 15 policy documents concerning horizontal ecological protection compensation through direct regulation and adjustment. The enactment of these ecological compensation systems and documents has promoted improvement in the HECRB mechanism, regional environmental protection and sustainable economic development, enrichment of the inter-provincial mutually beneficial and win-win cooperation practice in basins, and alleviation of the conflicts between the upstream and downstream interests.

As of January 2022, 18 provinces (autonomous regions and municipalities directly under the central government) in China have signed 13 cross-provincial HECRB agreements (

Table 4. Thirteen cross-provincial HECRB agreements in China.

No.	Subject Involved	Name of Policy Document	Ecological Compensation Assessment Standard or Objective	Compensation Fund
1	Guangdong Guangxi	Implementation Plan for Horizontal Ecological Compensation in the Upstream and Downstream of Jiuzhou River Basin (2015–2017)	Annual average water quality of cross-provincial Shanjiao section shall reach Grade III standard.	A total of 800 million yuan from the central finance; 300 million yuan in three years each from Guangdong and Guangxi.
		Implementation Plan for Horizontal Ecological Compensation in the Upstream and Downstream of Jiuzhou River Basin (2018–2020)	Annual average water quality of cross-provincial Shanjiao section shall reach Grade III standard.	100 million yuan per year each from Guangdong and Guangxi.
		Horizontal Ecological Compensation Agreement for the Upstream and Downstream of Jiuzhou River Basin (2021–2023)	Taking the water quality of cross-provincial Shanjiao section as the assessment standard, the annual average transboundary water quality shall reach Grade III standard with the monthly average compliance rate being over 80%.	Reward funds from the central government; 100 million yuan per year each from Guangdong and Guangxi.
2	Guangdong Jiangxi	Horizontal Ecological Compensation Agreement for the Upstream and Downstream of Dongjiang River Basin (2016–2018)	Taking the two cross-provincial sections of Miaozuili and Xingning Power Stations as the assessment monitoring sections, the annual average water quality of the effluent section shall achieve Grade III standard.	300 million yuan each year from the central government; 100 million yuan per year each from Guangdong and Jiangxi.
		Horizontal Ecological Compensation Agreement for the Upstream and Downstream of Dongjiang River Basin (2019–2021)	Taking the two cross-provincial sections of Miaozuili and Xingning Power Stations as the assessment monitoring sections, the monthly average water quality shall achieve Grade III standard, and strive to reach Grade II standard in 2021.	A total of 1.5 billion yuan of ecological compensation funds from the central government, Guangdong and Jiangxi.
3	Anhui Zhejiang	Agreement on Horizontal Ecological Compensation in the Upstream and Downstream of the Xin’an River basin (2012–2014)	Annual water quality shall meet the assessment standard. P ≤ 1 or P > 1	300 million yuan each year from the central government; 100 million yuan per year each from Anhui and Zhejiang.
		Agreement on Horizontal Ecological Compensation in the Upstream and Downstream of the Xin’an River basin (2015–2017)	Water quality stability coefficient shall be increased from 0.85 to 0.95. 0.95 < P ≤ 1, P ≤ 0.95, P > 1	400 million yuan, 300 million yuan and 200 million yuan in the three years, respectively, from the central government; 200 million yuan each year from each of Anhui and Zhejiang.
		Agreement on Horizontal Ecological Compensation in the Upstream and Downstream of the Xin’an River basin (2018–2020)	Water quality stability coefficient shall be increased from 0.85 to 0.95. 0.95 < P ≤ 1, P ≤ 0.95, P > 1	200 million yuan each year each from Anhui and Zhejiang.
4	Hebei Tianjin	Agreement on Horizontal Ecological Compensation in the Upstream and Downstream During the Project of Diverting Water from the Luanhe River to Tianjin (2016–2018)	Monthly average water quality of each assessment section shall reach Grade III or annual average water quality shall reach Grade II standard.	300 million yuan from central finance; 300 million yuan from each of Tianjin and Hebei.
		Agreement on Horizontal Ecological Compensation in the Upstream and Downstream During the Project of Diverting Water from the Luanhe River to Tianjin (2019–2021)	Taking the sections of Lihe Bridge and Shahe Bridge as the transboundary assessment sections, the annual average water quality shall reach Grade II standard.	100 million yuan per year each from Tianjin and Hebei.
5	Yunnan Guizhou Sichuan	Agreement on Horizontal Ecological Protection Compensation in the Chishui River Basin (February 2018)	Implement a “two-way compensation” standard to decide whether the downstream or upstream pays ecological compensation funds by the water quality of upstream boundary section that can be above Grade II or inferior to Grade II.	A total of 200 million yuan from Yunnan, Guizhou and Sichuan in the proportion 1: 5: 4, namely, 20 million yuan, 100 million yuan and 80 million yuan, respectively.
6	Beijing Hebei	Agreement on Horizontal Ecological Protection Compensation in the Water Conservation Area of Chaobai River Basin in the Upstream of Miyun Reservoir (2018–2020)	Three aspects (water quantity, water quality and upstream behavior control) are considered in the assessment reference. The total nitrogen is assessed on the basis of routine indicators of national assessment and rewards shall be given for total nitrogen decreases.	200 million yuan from Beijing; 100 million yuan from Hebei.
7	Chongqing Hunan	Agreement on Horizontal Ecological Protection Compensation in Youshui River Basin (2019–2021)	The two provinces (cities) shall be assessed on the water quality of Liye Town of the national surface water assessment section at the junction of Huayuan County.	According to the agreement, the amount of compensation for reaching or failing to reach the objective shall be 0.4 million yuan per month.
8	Anhui Jiangsu	Cooperation Agreement on Establishing Horizontal Ecological Protection Compensation Mechanism in Yangtze River Basin (December 2018)	The principle of “two-way compensation” shall be implemented. If the annual water quality reaches Grade II or above or Grade III, the downstream shall compensate the upstream. On the contrary, if the annual water quality achieves Grade IV, V or below, the upstream shall compensate the downstream.	40 million yuan or 20 million yuan from Jiangsu; 20 million yuan or 30 million yuan from Anhui.
9	Guangdong Fujian	Agreement on Horizontal Ecological Compensation for the Upstream and Downstream of Tingjiang-Hanjiang River Basin (2016–2018)	Adopting the principle of “two-way compensation”, it is required that the annual average value of the cross-provincial section of Tingjiang River and Meitan River shall reach Grade III, that of the cross-provincial section of Shiku River shall reach Grade III, and that of the cross-provincial section of Xiangdong River shall reach Grade V.	100 million yuan each year from Guangdong and Fujian.
		Agreement on Horizontal Ecological Compensation for the Upstream and Downstream of Tingjiang-Hanjiang River Basin (2019–2021)	Double-indicator assessment shall be adopted to examine both the pollutant concentration and water quality compliance rate.
10	Hunan Jiangxi	Horizontal Ecological Protection Compensation Agreement for Lushui River Basin (1 July 2019–30 June 2022)	The water quality of Lushui goldfish stone section reaching class III is set as the assessment objective.	According to the agreement, the amount of compensation for reaching or failing to reach the objective shall be 1 million yuan per month.
11	Shandong Henan	Horizontal Ecological Protection Compensation Agreement for the Yellow River Basin (Yulu Section) (May 2021)	The principle of “two-way compensation” shall be implemented to assess the annual average water quality and the annual average concentrations of three key pollutants of chemical oxygen demand, ammonia nitrogen and total phosphorus in the cross-provincial section of the main stream of the Yellow River at Yulu section (Liuzhuang section at the national level) in 2020 and 2021.	Fluctuating compensation: 60 million yuan each year as the basic compensation for water quality. In terms of compensation for changes of water quality, the compensation for a decrease of 1% shall be 1 million yuan, and the maximum compensation is 40 million yuan.
12	Gansu Sichuan	Horizontal Ecological Compensation Agreement for Yellow River Basin (Sichuan-Gansu Section) (October 2021)	The Maqu section water quality of the main stream of the Yellow River shall reach Grade II standard in the national assessment.	100 million yuan co-funded by Sichuan and Gansu at the ratio of 1:1.
13	Sichuan Chongqing	Implementation Plan for Sichuan-Chongqing Horizontal Ecological Protection Compensation in Yangtze River Basin (2021–2023)	Conduct water quality assessment for the two national assessment sections of the Zhutuo section of the Yangtze River and Gaodong Power Station section of the Laixi River.	100 million yuan each from Sichuan and Chongqing for protection and governance of the main stream of the Yangtze River; 50 million yuan each fro, Sichuan and Chongqing for conservation and governance of important tributaries of the Yangtze River (Laixi River).

Note: The information was collected and organized by the authors using relevant materials published on the government websites of the provinces (municipalities directly under the central government and autonomous regions).

), of which the Xin’an River HECRB mechanism is the most representative. The involved HECRB modes in all the basins that have signed compensation agreements mainly include the main stream mode, the “main stream + important tributaries” mode and the tributary mode [19]. In terms of the compensation reward and punishment mechanisms, most of them are one-way compensation mechanisms of “the downstream compensating the upstream”, whereas there are relatively few based on a two-way compensation reward and punishment mechanism of “mutual compensation between the downstream and the upstream”. Provinces have also promoted other HECRB work in addition to the cross-provincial HECRB agreements. For example, as of September 2021, all of the 133 counties (cities and districts) with cross-regional rivers in Shandong Province have signed the HECRB agreements, taking the lead in achieving full inter-county HECRB coverage in China. Likewise, in Sichuan Province, a horizontal ecological protection compensation mechanism has been established in the main stream of the Yangtze River and its important tributaries, realizing full coverage in the main stream, tributaries and 21 cities (prefectures).

With regard to the determination of the amount of horizontal ecological compensation in river basins, each river basin has formulated a corresponding specific compensation scheme according to the actual situation of the river basin. Taking Xin’anjiang River Basin as an example, according to the Pilot Implementation Plan of Water Environment Compensation in Xin’anjiang River Basin, the calculation formula of compensation amount is as follows:

$$p={\mathrm{k}}_0{\displaystyle \sum }_{i=1}^n{k}_{i }\frac{c_i}{c_{i0}}$$

(1)

In the formula, p is the ecological compensation index of the Jiekou section; k₀ is the stability coefficient of water quality; k_i is the index weight coefficient; c_i is the annual average concentration value of a certain index; and c_i0 is the basic limit of a certain index. In the course of three rounds of pilot projects, Anhui and Zhejiang provinces have comprehensively studied and evaluated the process of ecological compensation, and constantly updated and optimized the compensation mechanism. After each round of the pilot, the compensation fund settings and compensation standards had different degrees of change. Anhui and Zhejiang provinces agreed that if P ≤ 1, Zhejiang will compensate Anhui 100 million yuan a year, and if P > 1, Anhui will compensate Zhejiang 100 million yuan a year. In the Jiuzhou River Basin, the standard is based on the water quality of cross-provincial boundary mountain corner section as the assessment standard, ensuring that the annual average value of cross-border water quality reaches Class III standard. If the monthly average value reaches at least 80% the standard rate, compensation of 100 million yuan per year is given to the upper reaches by the lower reaches. Conversely, 100 million yuan is given to the lower reaches by the upper reaches when the target is not reached. Lishui River Basin has implemented an assessment target of Class III for the water quality of Lishui Goldfish Stone Section. According to the agreement, failure to reach the target shall be compensated at 1 million yuan per month. The assessment methods and compensation amount of other river basins are generally based on the requirement for the water quality of a section to meet a standard, and there is no uniform standard for the specific amount, which is agreed by the upstream and downstream governments (Table 4).

The signing of HECRB agreements at different levels has had several positive impacts. Firstly, it manages to increase incentives for pollution control in the upstream and downstream areas of a basin and form a long-term mechanism of basin protection and governance featuring clear responsibilities and cooperation in governance. Secondly, it steadily increases the water environment quality of the cross-section, and significantly enhances the coordination ability in the upstream and downstream of the basin, thus generating sound ecological and economic returns. Furthermore, it creates a positive social atmosphere of “government advocates, general public protects, enterprises participate in and I take the initiative” in the whole society. That is, the government changes the concept of development, enterprises consciously fulfill their responsibilities in environmental protection, and the public take an active part in environmental protection [20].

While the 13 horizontal ecological compensation agreements have played a positive role in the protection of water environment in the corresponding river basins, there are also corresponding shortcomings and defects. These include the absence of systematic legislation, imperfect financial support (there are large gaps in compensation funds and limited sources of compensation), rigid compensation mechanisms (insufficient coordination of multiple subjects and relatively distinct compensation methods), insufficient public participation and other issues.

The general basis for compensation is described in the document titled the Guidance on Accelerating the Establishment of Horizontal Ecological Protection Compensation Mechanism for the Upstream and Downstream of the River Basin released by four ministries and commissions including the Ministry of Finance. The water quality and quantity of the cross-section of the river basin shall be set as the compensation benchmark. The cross-section water quality of the basin can only be better, not worse. In cases where the country has determined an objective based on the section water quality, the compensation benchmark shall be higher than the national requirements. The local governments can select permanganate, ammonia, total nitrogen, total phosphorus and flow, sediment and other monitoring indicators, or select some of the indicators based on the actual situation; they shall take the average value over 3 to 5 years before signing the compensation agreement as the compensation benchmark. The details can be determined through independent negotiation between the parties representing the upstream and downstream areas of the basin [21].

3. Problem Analysis

Although the central government and local governments have recently issued relevant policy documents on ecological compensation, our analysis of these documents and the HECRB coordination practice reveals the following deficiencies in the construction of HECRB coordination mechanisms.

3.1. Absence of Laws and Regulations: Lack of Systematic Legislation on HECRB from the Central Government to Local Governments

At present, the central government and local governments have enacted 41 guiding policy documents on ecological protection compensation mechanisms, but the top-level laws and regulations of HECRB are still insufficient, and HECRB work mainly relies on various “policy documents” formulated by the central government and local governments. At the national level, there are no specific laws and regulations on ecological protection compensation, and the corresponding provisions are scattered in other laws and regulations that stipulate river basin ecological compensation, such as Article 31 in the Law on the Prevention and Control of Water Pollution revised in 2008, Article 31 in the Law of Water and Soil Conservation revised in December 2010, and Article 76 in the Yangtze River Protection Law enacted in December 2020. However, these three legal provisions are simply declarative provisions for in principle watershed ecological compensation without any substantive content [22].

As early as 2011, the Ecological Compensation Rule was included in the legislative work plan of the State Council and a draft was developed led by the National Development and Reform Commission. Nevertheless, this rule has not been promulgated and implemented after more than a decade. In November 2020, the National Development and Reform Commission issued the Ecological Compensation Rule (Draft for Comments) to solicit opinions from the public, but it has not been formally promulgated and implemented. At the local level, only the three provinces of Yunnan, Guizhou and Sichuan are making concerted efforts to protect the Chishui River. In May 2021, the “decision + regulation” form of “legislative package” set a precedent for being the first cross-basin joint legislation in China. Except for this legislation, no related legislation has been enacted on ecological compensation in other cross-provincial basins. In the Xin’an basin, where the horizontal compensation pilot has been relatively successful, though having introduced local laws and regulations to supplement the ecological compensation system, there is still a lack of particular laws and regulations for regulating ecological compensation. Moreover, the existing local laws and regulations are less systematic with single and scattered contents. Hence, it is necessary to formulate tailored legal norms so as to enhance their systematicity and authority, and ensure the smooth implementation of the policies [23].

3.2. Deficiencies in Coordination Mechanisms: Imperfect Diversified and Market-Oriented Compensation Coordination Mechanisms under the Guidance of the Government

(1)

Deficiencies in overall coordination make the watershed ecological compensation scattered and unsystematic. Due to the local restrictions to local governments’ management functions as well as the lack of comprehensive and specific laws and regulations on ecological compensation, governments in the upstream and downstream of a basin can only conduct temporary consultations in the form of agreements. A lack of systematicity and sustainability of watershed ecological protection brings difficulties in promoting China’s HECRB coordination mechanism universally.

(2)

The coordination mechanism subject is fairly singular, and the coordination mechanisms for diversified and market-oriented ecological compensation are not perfect. Through the analysis of 13 cross-provincial HECRB agreements, it is concluded that the coordination mechanisms mainly involve governments in the upstream and downstream areas and the compensation of funds simply refers to mutual compensation between governments in the upstream and downstream areas, with little involvement of relevant enterprises, social organizations or the public in the basin.

(3)

The durations of compensation agreements are too short to form a long-term mechanism for coordinated governance. Similarly, it was found in the analysis of the 13 cross-provincial HECRB agreements that the coordinated governance for each basin is carried out by means of three-year agreements. Such agreements need to be renegotiated once they expire, which fails to achieve a long-term mechanism for coordinated governance.

(4)

The scope horizontal coordination is small, which makes it difficult to effectively achieve the effect of coordinated governance in the whole basin. According to statistics, there are over 1500 rivers with a basin area of more than 1000 square kilometers in China, 228 rivers with a basin area of more than 10,000 square kilometers, and over 100 major tributaries in the seven major basins. To date, the country has only signed 13 cross-provincial HECRB agreements, in which a basin area of 0.327184 million square kilometers is involved, consisting of around 3.4% of the land area. On account of complex relationships among the main streams and important tributaries of the seven major basins, only the Henan–Shandong section and the Sichuan–Gansu section in the main stream of the Yellow River signed an ice-breaking agreement on horizontal compensation in 2021; in 2021, Sichuan province and Chongqing selected the main stream of the Yangtze River and the Laixi River Basin as the first batch of pilot rivers in the main stream of the Yangtze River, and signed a compensation agreement.

3.3. Single Compensation Mode: Failure to Effectively Promote the Combination of Resource Protection, Development and Utilization

Various compensation methods are stipulated in documents such as Opinions on Deepening the Reform of Ecological Protection Compensation System issued by the General Office of the Central Committee of the Communist Party of China and the General Office of the State Council, the Guidance on Accelerating the Establishment of Horizontal Ecological Protection Compensation Mechanism for the Upstream and Downstream of the River Basin released by the Ministry of Finance and three other ministries and commissions, and implementation plans at the provincial level. These compensation methods include “financial compensation, fixed cooperation relationship, industry transfer, talent training, and co-construction of parks”. Market-oriented compensation methods of “encouraging emission trading and water right trading in the upstream and downstream of the basin” and the PPP-type compensation method of “purchasing ecological products and services” are also specified [24].

It can be seen from the signing of HECRB agreements, the compensation mode that is actually adopted tends to rather singular, basically a “blood transfusion” from government to government, i.e., direct financial compensation. It has many advantages, such as its simplicity and easy operation. The drawbacks are its dependence on a single source of funds, huge pressure on the government’s finance, and the high costs of supervision. Additionally, such a method makes it difficult for the market to fully play its role, which is inconducive to the optimal allocation of resources and the innovative development of the compensated area. The compensated area is less able to use its non-financial advantages to make up for the fund shortage, and the financial compensation cannot directly benefit the public or enterprises [25].

With respect to the cross-provincial HECRB practice, it was observed in the 13 horizontal compensation agreements that except for the HECRB agreement of the Chaobai River basin and the Xin’an River basin, only a form of monetary compensation is specified, whereas indirect compensation methods such as co-construction of parks, industry transfer, fixed cooperation relationships and talent training are rarely seen in the agreements [26,27]. The third round of the Xin’an River HECRB agreement proposed to encourage the establishment of green funds, public-private partnership (PPP) mode and financing discounts in order to increase social capital investment in comprehensive governance and green industries in the Xin’an River basin [28]. As for the practice of market-oriented compensation methods, emissions trading and water right trading have not really started, trading rules and trading platforms are not clear, and cross-provincial transactions are not on the agenda. Furthermore, PPP-type ecological compensation also has not been included in the scope of compensation methods [29].

3.4. Shortage of Compensation Funds: Difficulties in Using Existing Compensation Funds to Make up for Actual Investment in Environmental Governance by Governments in Upstream Areas

According to the horizontal compensation pilot situation, the compensation amount is far from covering the investment required to improve the water quality of the section, and it is difficult to increase the actual investment. Considering the horizontal ecological compensation pilot of “the Xin’an River basin”, which is China’s first cross-provincial river basin, during the three rounds of ecological agreements from 2012 to 2020, each subject had invested a total of 4.8 billion yuan in ecological compensation. Huangshan City in the upstream area has received compensation funds totalling 3.58 billion yuan while investing up to 12.6 billion yuan in watershed environmental protection, resulting in large deficits and great financial pressure during the three rounds of agreements [30].

In the meantime, studies have shown that in the process of promoting the ecological compensation mechanism in the Xin’an River basin, the growth rate of comprehensive benefits in the upstream area has gradually slowed down, and the average economic benefit is the lowest, which means that the ecological compensation policy of the Xin’an River basin has no marked effect on promoting regional economic and social development [31,32].

Likewise, in April 2021, Shandong Province and Henan Province signed the Horizontal Ecological Protection Compensation Agreement of the Yellow River Basin (Henan–Shandong Section), which is the first cross-provincial HECRB agreement in the Yellow River basin. The agreement stipulates that based on the water quality monitoring results of the annual average water quality reaching Grade III standard in the cross-provincial boundary section of the Yellow River mainstream between Henan and Shandong, Henan shall give Shandong 60 million for each level of decline; conversely, for every level of increase, Shandong shall give Henan 60 million. Till July 2022, due to the fact that the water quality of the Yellow River section entering Shandong has always remained above Grade II, Shandong, as a beneficiary, has fulfilled its commitments by providing a total of 126 million yuan as ecological compensation funds for Henan. For example, in 2021, Sanmenxia City of Henan Province carried out a comprehensive governance project in the whole basin of the Yellow River tributary, and the total investment amount was estimated to be 2.48 billion yuan. However, Sanmenxia City only received 15.54 million yuan from the Henan provincial guide fund for the Yellow River HECRB, a drop in the ocean. In fact, a large gap exists between the income of ecological compensation funds and the expenditure on environmental governance, with the result that some local governments in the upstream lack stamina for investment in environmental protection. Other transboundary basins are also facing shortages of funds, from which it can be concluded that in the ecological compensation practice, the compensation funds disbursed through horizontal compensation transfer are far from making up for the actual investment in environmental governance from governments in the upstream areas.

4. Measures to Improve HECRB

4.1. Perfecting Laws and Regulations on HECRB

There are many related stakeholders concerned with HECRB mechanisms, and the system design is indeed complex. Hence, it is necessary to establish a corresponding legal system to regulate the mechanism and urge governments in the upstream and downstream areas to communicate and cooperate actively. With regard to legislative technology, it should be based on the civil property rights system, combined with environmental protection, civil system, economic development, ecology and knowledge of other fields. Furthermore, it is necessary to clarify the legal nature, legislative purpose, basic principles, legal basis, application scope, national financial subsidy mechanisms, local government cooperation mechanisms, social subject trading mechanism, and safeguard mechanisms of ecological protection compensation to afford legal guarantees for ecological protection compensation.

In legislation, the central government should speed up the introduction of Ecological Compensation Law, Ecological Protection Compensation Rule and other supplementary laws and regulations to provide strong legal support and institutional guarantees for HECRB; the provincial legislatures and other competent legislatures should enact targeted laws on the HECRB system in view of their own legislative authority and the practical experience of ecological compensation in the region, and steadily promote the legalization of HECRB policy.

When it comes to accessory systems, the central government and local governments should formulate more detailed and precise rules for implementation of ecological compensation given the problems of current laws and regulations in practical application in ecological compensation. It is also necessary to develop ecological protection compensation implementation systems catering for different fields and regions so that a legal system for ecological protection compensation is gradually established [33].

4.2. Building Diversified and Market-Oriented Compensation Coordination Mechanisms under the Guidance of the Government

In December 2018, the National Development and Reform Commission, the Ministry of Ecology and Environment and seven other departments jointly issued the Action Plan for Establishing a Market-oriented and Diversified Ecological Protection Compensation Mechanism, which specified the establishment a market-oriented and diversified ecological protection compensation mechanism by 2020. Therefore, HECRB is supposed to move towards a diversified and market-oriented co-governance mechanism under the guidance of the government and establish an ecological compensation mechanism characterized by multi-subject co-governance (Figure 1).

On the one hand, it is necessary for the government to play the leading role. The ecological environment governance and ecological compensation between the upstream and downstream areas of basins need to be arranged in a unified way, and the consultation should be led by the government [34]. The central, provincial, municipal and county (district) governments need to clarify their responsibilities in HECRB, give full play to the corresponding main functions, strengthen the coordination mechanisms among the governments at the same level, and sign horizontal ecological protection compensation agreements. They also need to further clarify the compensation factors, compensation methods, compensation methods and compensation standards, and ensure the establishment and implementation of horizontal ecological protection compensation mechanisms [35,36].

On the other hand, it is necessary to reinforce the influence of the market and the public in the construction of the ecological compensation mechanisms of a basin. While taking full advantage of the government’s leading role, we need to encourage the public and enterprises to shift from “passive” to “active”. Meanwhile, in each link of system construction, the main elements of the public and the market should be fully considered, and the coupling of government, enterprises and the public should be fulfilled to establish ecological compensation coordination mechanisms at the city level with multiple governance and inter-governmental coordination. These mechanisms should be subject to coordination from the central government, consultation between provincial governments, and then be implemented by the enterprises with the public’s active participation.

4.3. Exploring Various Compensation Modes According to Local Conditions and Actively Advancing Indirect Horizontal Ecological Compensation

In the central and local policy documents such as Opinions on Deepening the Reform of Ecological Protection Compensation System and Guidance on Accelerating the Establishment of Horizontal Ecological Protection Compensation Mechanism for the Upstream and Downstream of the River Basin, it is encouraged to make a comprehensive use of government-led modes, market-based modes, PPP type and other compensation methods in the horizontal ecological protection compensation of river basins [37,38]. The capital compensation method in the government-led model is a typically the “blood transfusion” method, i.e., direct financial compensation, which benefits the compensated local government. In contrast, the implementation of “hematopoietic” indirect horizontal ecological compensation of market transaction type and PPP type can benefit not only the compensated local government, but also a myriad of stakeholders located in the compensated area including public, enterprises, organizations of all kinds and third-party institutions. This is likely to enhance the enthusiasm and initiative of enterprises and the public to participate in environmental protection. The “hematopoietic” indirect horizontal ecological compensation is conducive to improving the innovation ability of the compensated area, and also upgrades the hard power and soft power of the compensated area [39].

Hence, while giving full play to the leading role of direct financial compensation, it is particularly important to explore a variety of compensation modes in view of local conditions, develop indirect horizontal ecological compensation methods such as market transaction type and PPP type, and build a diversified and multi-layered ecological compensation method with government and enterprises as the main body, and markets as the hub and specialization as the platform (

Table 5. Diversified river basin transverse ecological compensation model.

Ecological Compensation Mode	Compensation Type	Applicable Object	Compensation Subject	Advantage and Disadvantage
Government-oriented	Capital compensation of counterparts, Cooperation, Industrial transfers, Talent training, Co-construction of parks	Public welfare, Ecological public service	The government is the investor and is responsible for the main ecological protection and restoration.	advantages: Reasonable compensation and easy operation can be given to ecological protectors. disadvantages: Single source of funds, government financial pressure, difficult to supervise.
Market Transaction Type	Emissions trading, Water rights trading, Green finance, Green mark, Green procurement,	Semi-quasi-public welfare ecological public service with strong economic benefits	Enterprises are the investors, and the market is mainly responsible for ecological protection.	advantages: Broadening the sources of funds and reducing the pressure of government funds. disadvantages: Imperfect legal mechanism and high transaction costs.
Government and social capital cooperative type	Public-private partnerships, Government purchase of services	Quasi-pure public welfare ecological public service with weak economic benefits	Enterprises are the main investors, and the government is the regulator and service buyer.	advantages: Strong public welfare is conducive to stimulating public enthusiasm for environmental protection. disadvantages: Need to strengthen government guidance and supervision.

). The indirect horizontal ecological compensation mode is mainly embodied in the continuous and indirect economic compensation realized by industry transfers, fixed cooperation relationships as well as joint construction of parks. The competitive compensation is realized by green technology assistance, talent output, purchase of ecological products and services, knowledge training, etc., and the ecological compensation of market transaction type and PPP type such as water rights and emission rights [40,41]

4.4. Widening the Financing Channels for Horizontal Ecological Compensation with Multiple Measures

In terms of increasing the investment of horizontal ecological compensation funds, there is a lot to do for the central government and governments in the upstream and downstream areas. First, the central government needs to continue to increase capital investment and better coordinate so that the downstream areas reasonably share the ecological environment management costs of the upstream areas, thereby maximizing the economic benefits of the upstream area while improving the water environment in these areas, and thus ensuring the long-term and stable development of horizontal ecological compensation mechanisms [42]. Second, governments in the upstream and downstream areas should actively explore diversified financing channels. In addition to directly accepting central investment funds and horizontal transfer payments, they should also explore diversified financing channels, strive to attract social capital, and join hands to broaden the sources of compensation funds. On the one hand, they need to take active steps to explore horizontal ecological capital financing. Backed by the central policy, they need to explore a green financing method of “government guidance + market-oriented operation”. At the same time, the central financial department should coordinate the financial departments of the compensating areas and the compensated areas. It should also participate in horizontal ecological compensation by mobilizing enormous financial resources, work with relevant policy-oriented financial institutions to play a part in credit enhancement, guarantee, discounts and reward, etc. In addition, it should encourage financial institutions to provide finance in the compensated areas and solve the problem of insufficient funds while making full use of the economic value of ecological products. On the other hand, in line with the requirements of green development in the compensated areas, the central government and local governments should encourage the financial institutions in the compensated areas to study and popularize green financing compensation products such as green credit, green corporate bonds and green asset-backed securities as well as green investment compensation products such as green trusts, green stock equity funds and green PPP [43,44]. It should also promote diverse green insurance compensation products and continuously attract social capital that meets the access conditions to participate in the planning, construction and operation of eco-industrial projects in the compensated areas.

5. Conclusions

With the continuous development of research and practice of inter-basin management, the role of horizontal ecological compensation in river basin management is receiving more attention. At the same time, the horizontal ecological compensation of river basins in western countries also shows a certain degree of inadaptability in China. Taking the current water quality status of major water bodies and domestic ecological compensation systems as an example, this paper introduces the development and practice of river basin horizontal ecological compensation in major river basins in China, and analyzes some problems and difficulties in the practice of river basin horizontal ecological compensation in China. The study shows that the traditional approach to river basin management has not adapted to the new problems and situation of river basin management in China. The study has a certain reference value for the current river basin management in exploring diverse ecological compensation methods, improving the laws and regulations of river basin management, diversifying the market-oriented ecological compensation coordination mechanisms, and broadening the channels of fund compensation. In addition, it provides a reference for river basin management in other developing countries.

With the development of river basin management mechanisms, the main body of public participation in river basin management is increasingly diversified. The deep cooperation among the government, enterprises, community organizations and citizens has become an important force in river basin management. Clarifying how to improve the legal status of public participation in horizontal river basin management and how to standardize the work content and behavior norms of different participants in participatory river basin management will be the important focus of further research.

Because the author’s professional expertise is mainly in environmental resources law and public governance rule of law, this research places more emphasis on theoretical development. The use of empirical research is relatively weak, due to a lack of professional ability in the statistical analysis of data, so this study relies less on statistical analysis of relevant data and the establishment of corresponding models, which is a shortcoming of this study.