Qian'an, Hebei Province, a steel enterprise has successfully solved the problem of circulating water concentration in high alkalinity and high hardness water sources by applying electrochemical descaling technology; A printing and dyeing company in Hangzhou, Zhejiang has adopted membrane treatment systems and smart water management technology, significantly improving the reuse rate of reclaimed water and water reuse; In Rizhao, Shandong, a pulp and paper company has comprehensively applied technologies such as biological treatment to achieve a combination of source reduction and deep reuse of wastewater... Nowadays, water resource recycling technology is more mature and efficient, and the water circular economy has great potential. Countrymen has more people and less water, and water resources are unevenly distributed in time and space. With the development of the economy and society, the demand for water resources continues to grow, and the contradiction between supply and demand is becoming increasingly prominent. In addition, the overall utilization efficiency is not high, and high-quality development and ecological environment protection are facing challenges of water scarcity. This situation urgently requires us to further transform our concept of water resource development and utilization, and vigorously develop a water circular economy. Water circular economy, with water resource conservation and recycling as its core, aims to achieve the coordination and unity of social and natural water circulation. It emphasizes water conservation in the usage process, through water-saving transformation of industrial enterprises, development of water-saving agriculture, promotion of water-saving products, etc., to minimize production and domestic water consumption and improve water resource utilization efficiency; In the process of sewage discharge, sewage is vigorously developed as a "second water source", treated and reused for industrial production or ecological replenishment of rivers, lakes and wetlands, reducing the consumption of primary water resources. To develop a water circular economy, the scarcity of water resources must first be reflected in pricing and institutional design. The scarcity of water resources is reflected in price, which endows water resources with economic value, such as water resource taxes paid by enterprises when extracting water, water fees paid by residents in their daily lives, and supporting various forms of water rights trading. The scarcity of water resources is reflected in the system, which manages the total amount and intensity of water use, such as improving the water-saving planning system and perfecting the water quota system. These systems and rules lay a solid foundation for the development of a water circular economy. We also need to strengthen the cultivation of the main body. On the one hand, it is necessary to actively guide various water consuming enterprises and other production entities to develop a water circular economy, such as encouraging large-scale water users in agriculture and industry to carry out water-saving transformation, and carry out the reuse of water and the recycling of recycled water. On the other hand, it is necessary to cultivate business entities that serve various links of the water circular economy, such as third-party water-saving service enterprises, sewage treatment and recycled water supply enterprises, water-saving product and equipment manufacturing enterprises, etc., to support the high-quality development of the water circular economy with dynamic business entities. Further improvement is needed in incentive and constraint mechanisms to generate endogenous motivation. From the perspective of incentive mechanisms, a series of policy combinations such as investment, pricing, finance and taxation can be used to support the development of a water circular economy. For example, implementing tiered water pricing for residents and reducing a certain proportion of water resource tax for taxpayers whose industrial water use efficiency reaches the advanced value of national water use quotas. From the perspective of constraint mechanisms, water use behavior can be regulated and guided through laws, standards, certifications, etc., such as implementing the "Water Conservation Regulations", implementing water efficiency labeling management for water products with high water-saving potential and wide usage, and gradually phasing out water products with lower water efficiency levels. General Secretary Xi Jinping pointed out that "to promote Chinese style modernization, we must take into account the issue of water resources". Vigorously developing the water circular economy, establishing development on the basis of sustainable utilization of water resources, ensuring water resource security to the greatest extent possible, maximizing water resource utilization efficiency, and making every effort to improve the quality of water ecological environment, will surely better promote the "harmony between people and water", and continuously write a new chapter in the Chinese nation's water governance and prosperity for the people. Zhang Deyuan, Associate Researcher at the Institute of Economic System and Management, China Macro Economic Research Institute