Role of Virtual Water from the Perspective of Generalized Trade

In practice, virtual water trade played a more important role in our daily life and production process than physical water trade. Virtual water trade was capable of alleviating the water scarcity issue by transferring virtual water embodied in products from water-rich regions to the water-scarce ones such as Urumqi. In practice, however, the transfer of virtual water was not always the case, and its direction could even be the opposite. For instance, in Xinjiang, a huge volume of virtual water was transferred to water-rich regions despite the local water scarcity. This paper applied the term of generalized trade to investigate the paradoxical scenario that went against comparative advantage theory, and revealed that virtual water trade never played a monodrama but participated in a chorus with physical water trade, virtual energy trade, virtual labor trade, virtual land trade and others. Specifically, generalized trade, as all these forms of trade combined, drew a multiple-perspective portrait of traditional trade, and contributed greatly to the sustainable development of an economy.