Quantitative analysis of climate change impact on Zhangye City’s economy based on the perspective of surface runoff

Abstract Zhangye City is a representative agricultural city in China where agriculture depends heavily on precipitation in the Heihe River Basin; water use for agriculture plays a key role in the sustainable development of total water resources. This study, based on the predicted surface runoff by GCM, uses a CGE model with a water-land resources account, to analyze the impact of climate change on Zhangye City’s economy and agricultural water consumption. The results show that climate change increases surface runoff by 8.84%. The increasing surface runoff contributes most to the total water consumption, increasing by 8.11% accompanied by a small GDP expansion of 0.12%. Relative to the industrial structure, agricultural sectors benefit most. Contrarily, export-oriented industrial sectors see a decrease in benefit, resulting in employment migrating to lower value-added agricultural sectors. From the water types, the consumption for underground and other water also rise by 6.69% and 5.73% respectively, due to the economic scale expansion effect of the agricultural sectors. For varieties of crops, grain crops consume more water because of its greater water intensity. And the land is mostly transferred from economic crops to grain crops. Therefore, the government should pay attention to changes in the consumption propensity of water resources, continue to promote agricultural water-saving measures and the adjustment of agricultural planting structure.