1. Introduction: the Coordination between Environment and Development in the Future

The year 2006 is the first year of the 11th Five-Year Plan Period as well as the new beginning for the development of the Xiaokang Society (well-off society) in an all-round way. At this critical moment, it becomes extremely important to have an overall prospect of China’s environment and development in the next 15 years or even a longer period.

China will face a series of major internal and external changes in the process of building the Xiaokang Society in the next 15 years or even a longer period, which include increasing population, big changes in economic scale , economic structure and efficiency, continuous rise of the living standards of urban and rural residents, various growing social conflicts, increasingly obvious trend of globalization and stronger contribution of science & technology to economic development. In particular, China will face enormous challenges in resources and environment.

In the year 2020, China will achieve the goal of the Xiaokang Society in an all-round way, reaching world average level in terms of per capita economy and realize the second step of the Three-step Strategy, which will lay a solid foundation for China to become an advanced country in the mid-21st century. By that time, will a variety of pollutants produced by China rank high in the world or will them be basically kept under control? The challenges that China will confront in terms of resources and environment depend on both China’s future economic growth pattern and its environmental governance capacity. Therefore, it’s especially important to choose the path of environment and development in the future and to enhance the environmental governance capacity.

The Chinese Government will adopt more effective measures to facilitate the transformation of growth pattern and improve the quality of economic development since the beginning of the 11th Five-Year Plan period. The transformation of economic growth mode will raise resource efficiency and reduce environmental pollution of per unit output. The focus of this report is not only on arguing for the necessity of adopting the strategy of “resource-efficient, environmental friendly, and social harmonious sustainable development”, but furthermore on analyzing the pre-conditions for implementing this strategy.

This report aims at providing an outlook for environment and development in China towards 2020 starting from now and analyzing the development paths of the environment and economic growth. Looking into the year of 2020, China’s total economic volume will quadruple if it continues the present developmental trend, and it will be only second to that of the USA. But how about the environmental pressure then? Following the current environment and development trend, China will be confronted with more grave environmental challenges such as energy shortage, air pollution, great international pressure for greenhouse gas emission reduction, the exacerbating water crisis, huge amount of household wastes, industrial solid wastes and the hazardous wastes, the seriously degraded ecosystem, the dramatic loss of the biodiversity, deteriorating fragile rural environment, the frequently sounding alarm of the newly emerging environmental issues concerning people’s health such as the indoor environmental pollution, ground ozone pollution, mercury pollution, and also the great international pressure upon China for its global environmental impact arising from its development etc.

Either out of the demand of domestic development or the need for a right international environment for its peaceful development, China has to avoid or abate the environmental contradictions. To meet the future possible grave challenges from the resources and environmental crisis, and realize the synchronized and coordinating development of environment and economy, it has to enable the strategy of “resource-efficient, environmental friendly, and social harmonious sustainable development”, while following the blueprint of the 11th Five Year Plan as guided by the scientific development concept. It has to establish the taxation and pricing system as well as the technological innovation system commensurate with that, and improve the environmental governance capacity, promote the sustainable consumption, production and trade (SCPT), expedite the transformation of the economic growth mode, maintain the total economic volume, adjust industrial structure and improve the production efficiency, so as to ensure the implementation of the strategy of “resource-efficient, environmental friendly, and social harmonious sustainable development”.

2. Overall Xiaokang Society: Prospect of China’s Economy in the Future

After two decades of rapid economic growth since reform and opening up, China’s economy has entered a new important development stage. This stage is a very important strategic opportunity for China’s economic growth. If China can make good use of this opportunity to overcome the difficulties, address the problems during this process and maintain fast economic growth, then China’s economic strength and overall national power will step onto a new platform and so will be the people’s living standard.

The Chinese government has set up the goal of quadrupling the per capita GDP and achieving a Xiaokang society by 2020. By that time, China will have entered a Xiaokang society with a GDP increasing rate of 7.2% totaling USD 4,000 billion and per capita GDP of USD 3,000. And in fact, the development over the last several years has far outstripped the planned indicator. This report tries to model the possible prospective of the future economy in China through the DRCCGE2004. In light of the released statistics, the annual economic increasing rate was 9.5% during the 10th Five-year Planning period. And the calculation from the baseline scenario estimates that the rate in the 11th Five-year Planning period will be 9.1%, a little lower than that of the 10th Five-year Planning period. The rate for 2010-2015 and 2015-2020 will be respectively 8.0% and 6.9%. On the whole, the first twenty years of this century will witness a rapid economic growth in China, at an annual rate of 8.3%. The total economic volume will also increase rapidly. According to the pricing in 2004, the total volume will reach USD 6,700 billion and per capita GDP USD 4,700.

3. Environmental Challenges: Prospect of China’s Environment in the Future

The present economic increase is at the cost of China’s resources and environment. With the rapid economic increase in China, the resources and environment will witness huge changes. Extrapolated on the basis of the current economic increase and the consumption of resources and environment, the resources and environment in China will face numerous challenges by 2020.

This section will analyze the prospect of the environment from now on to 2020 or even for a much longer period. The trend analysis is extrapolated on the basis of the current environmental situation, that is, what will be the future environmental situation if current development trend continues. This report projects the situation of the major resources and environment and shows that China will be confronted with seven severe environmental issues in the future, that is, air pollution, water pollution, solid wastes, eco-system, the future emerging environmental issues, global environmental issues and the external environmental impacts of China’s economic growth. Detailed analysis on environmental challenges in urban as well as rural areas will be elaborated in other reports.

3.1 Challenge 1: China will be faced serious energy security, severe air pollution and increasingly heavier pressure on reduction of emission of greenhouse gases.

3.1.1 the issue of energy security

The next 15 years is the critical period for China to complete the capital-intensive industrialization and the peak time of China’s population. It will be the period when the living standard of all Chinese people approaches to well-off level, too. During this period, there will be a dramatic rise in the total demand for energy in China. The reasons are as follows. First, the economic growth mode of high energy consumption and this industrial structure will inevitably lead to the high consumption of the energy; secondly, with the increase of per capita GDP, the energy consumption will go higher consistently; thirdly, the increase in the demand of energy is highly associated with urbanization; fourthly, the export of products from high energy consumption will remain at a high level.

Due to the limited energy resources in China, the relative backwardness of the energy technologies has further hampered the efforts to increase the capacity of energy supply. Therefore, China’s energy supply faces huge pressure. In the long run, the biggest challenge for energy security in China comes from oil. This is because, in the context of the present technologies, oil and natural gas finds no or nearly no substitutes for the transportation and petrol-chemicals sector. However, in terms of the natural situation of the energy resources, China is in lack of petrol-oil. In addition, the conventional fuels such as liquefied coal and the bio-diesel can only partly supplement the oil, and the new fuels such as hydro-fuel, fuel-cell, and solar energy can become quite competitive alternatives in the market only after 2030. Such problems as the increasing reliance on the import of the oil, the limited number of the oil-producing countries, and the low cleanness of the imported oil, and the inadequate oil emergency reserve as well as the oil geo-politics etc all have posed great challenges to China. According to the research of the EIA, in following the present economic development rate, by 2020, China will need 11.7 million barrels of oil per day, but if the economy increases at a higher rate, the daily oil need will be 13.1 million barrels; and if at a lower rate, the daily need will be 10.4 million barrels.

To sum up, China’s energy situation is very grave in the next 15 years and the energy security will face huge challenges. Nevertheless, we should have a holistic and objective understanding of the energy security problem for China. As a matter of fact, China’s increasing energy demand has its own particular features. First, the rising energy demand exists only in a certain period. Due to China’s industrialization and urbanization drive, energy will be in great need for infrastructure construction and construction of civil buildings. Once China completes its process of industrialization and urbanization, the increase in energy demand will be bound to drop sharply. Second, China is a scaled economy with a large population, which accordingly results in big gross energy consumption close to the sum of 15 EU member states in total. However, China’s population is three times of that of the 15 EU states, and China’s per capita energy consumption fails to reach the world average level. Third, at present, China is actually the world factory, with 40% of products for export. Those products consume much energy as well. Although they are not used in China, the energy consumed has yet been calculated into China’s gross energy consumption. The concerns of international community over China’s energy demands may be exaggerated considering the factors of period-based nature, per capita level of energy consumption, and import and export etc.

3.1.2. Increasingly severe air pollution

Considering the influence of such factors as natural conditions, industrial structure, coal-dominant structure, transportation and population intensity, air pollution in China will present the following characteristics in the next 15 years:

• Growing Pressure on the Control of Regional Air Pollution

•

At present, the affluent coal resources still remain the dominating part for China’s energy consumption, and the proportion of coal is 76% and 68% respectively in the structure of energy production and consumption. The emission of hazardous gases from coal burning accounts for 65% to 90% of the total emission of hazardous gases in China amounting to about 80 million tons each year. In particular, acid rain pollution resulting from the emission of SO2 from the coal combustion power plants becomes more and more serious. It is estimated that the power sector will further expand. By 2010, the total demand for power will be 3.60 trillion kwh, and the installation electricity capacity will reach 7.70 trillion kwh, among which the thermal power will be 5.57 trillion kwh. By 2020, the total demand for power will reach 5.10 trillion kwh, and the installation electricity capacity will reach 9.70 trillion kwh, among which the thermal power will be 6.50 trillion kwh. At the same time, the coal consumption by the power sector will further reduce. By 2010, it is estimated that the national average coal consumption for power will be 360g/kwh, and then 320g/kwh by 2020. All these factors will influence the emission volume of the SO2 owing to energy consumption at different periods in the future in China. It has to be noted that mandatory indicators set out in the Eleventh Five-Year Plan requires the reduction of the emissions of the major air pollutant -- SO2 by 10%. The desulphurization efforts in power plants consume electricity as well, which means the reduction of SO2 emissions results in not only the increase in energy consumption, but also to remove more sulphur in turn.

• Huge Economic Losses and Serious Health Problems Caused by Air Pollution

The impact on the economic development caused by the air pollution in China has become prominent and resulted in alarming economic losses. Relevant studies on the economic losses caused by air pollution indicate that the losses arising from air pollution constitute 3% to 7% of China’s GDP. If calculated at the GDP of 2005, the losses would amount to 547 billion to 1.276 trillion Yuan. The World Health Organization claimed that in 2004, the atmospheric environmental quality of only 31% of Chinese cities met WHO standards. In eleven mega cities, the particles in the air causes a death toll of 500 thousand people as well as 400 thousand chronic bronchitis patients annually. One of the World Bank’s reports estimates that, should current situation go on, the losses from diseases caused by coal burning will take up 13% of China’s GDP by 2020. It has to be noted that little research on the economic losses resulting from diseases caused by air pollutions has been done and what’s more, only the direct economic loss per se has been calculated.

• Increasingly severe urban air pollution

Although China has made great efforts to control urban air pollution, the picture is still quite gloomy. Among the 342 monitored cities in 2004, cities reaching the Grade III air quality totaled 141, accounting for 41.2%. The quality of air in 69 cities was even below that level, which accounted for 20.2%. These figures mean that people in about 70% of the cities had been long exposed to the air below the standards. It has become a serious problem, especially with the cities in the northern part of China, metropolises, big cities, cities rich in coal resources etc.

The pollutants in urban air pollution are mainly referred to particles, SO2 and vehicle emission. It has to be noted that emissions from vehicle has become one of the main pollutants in urban air pollution. The emission of SO2 in China has ranked 1st in the world, and become the 3rd largest acid rain area after North America and Europe. The acid rain area has been expanding rapidly in China. In some cities such as Changde City in Hunan Province, Dexing City in Jiangxi Province, Lishui City, Anji City and Kaihua City in Zhejiang Province, etc, whenever there is a rain, acid rain occurs.

The sources of urban air pollution mainly come from direct combustion of coals and vehicle emission. With the upgrading of household fuels and relocation of factories from downtown areas, it is predicted that automobiles will play bigger and bigger roles in air pollution. According to the research, it was estimated that by 2004, the vehicle number would be 56.69 million by 2010, and 131.03 million by 2020. The pollution caused by the vehicles could be predicted roughly in the next 15 years while all the other factors remain unchanged (see figure 1). It has to be noted that Mr. Chen Qingtai (2004) projected that the number of cars would be 33.56 million but actually, it was 43 million in 2005. Therefore, there is every reason to believe that his prediction of the number of cars would be lower that the fact then. Accordingly, the pollution caused by cars we gave here would also be lower than that in the reality. Furthermore, China will lower the import tariff of automobile to 25% and that of its components to the average of 10% from July 1, 2007 according to the commitments made when entering WTO. Therefore, the market for private cars will enjoy a big expansion. It can be predicted that number of the vehicles will have a rapid increase in the next 15 years and the environmental pollution caused by the exhaust gas from the vehicles will be much more serious.

Figure 1. the pollutants discharged by the automobiles in China by 2020 (10,000 tons in unit)

Note:“1”refer to “CO”；“2”refer to “NO”；“3”refer to “HC” and the blue means lowest emission while the pink square means highest emission.

3.1.3 Increasingly international Heavier Pressure on Reduction of Emissions Of Greenhouse Gases

Coal is heavily consumed among all kinds of energy resources in China. And China is now in the transitional period from labor-intensive development to capital-intensive industrialization driven by heavy and chemical industries. This means continuous rapid rise of the emission of greenhouse gases in the next several decades. According to the latest prediction made by the EIA in June, 2006, in the context of three scenarios of reference development, high speed economic increase and slow speed increase, the emission of carbon dioxide in 2020 will reach 8.159 billion, 9.287billion, 7.164 billion tons respectively (see the figure 2 below). The total volume of greenhouse gas emissions will be equal to that of United States around 2015.

Figure 2. the GHG emission in China in three scenarios

(blue is the reference scenario, pink is the slow speed increase and the yellow is the high speed increase)

Source: EIA (2006),

In general, the climate in China has been in agreement with the trend of the global average temperature. In the last 50 year, in the context of global warming, the temperature in China witnessed dramatic increase. Among that, the increase margin in the North and Northeast of China is the biggest, almost a rise of 0.4℃ to 0.8℃ every ten years. It is estimated that by 2020 to 2030,the average temperature nationwide will rise 1.7℃ and by 2050，the national average temperature will increase by 2.2℃。China is the victim of the climate change, and over 70% of the population, 80% of the industries and agriculture and over 80% of the cities are all under the threat of multiple disasters. Since 1949, the death toll because of the disasters reached more than 500 thousand and the direct economic loss accounted for 3% to 6% of the GNP, 30% of the average fiscal revenue, tens times of that of the USA and Japan.

Under the current situation, it is difficult for China to adopt immense immediate measures to reduce greenhouse gas emission. First of all, China’s bid to build a Xiaokang Society depends on its economic growth, which is normally fueled by increasing energy consumption. Second, China is in need of plenty of energy in its industrialization and urbanization drive. Third, the coal-dominant energy structure in China is impossible to change fundamentally in the foreseeable future. Fourth, both China’s technical and capital capacities constrain its stride towards the road of low-carbon development. Fifth, or the most important reason, is that China fails to effectively control the air pollution in those conventional cities. There’re still more than 200 million people in China who live on less than 1 U.S. dollar a day. Therefore, the control of greenhouse gas emissions cannot be China’s first priority.

However, China’s social, economic, and energy policies actually impose significant effects on the reduction of greenhouse gas emission. Since the adoption of the family planning policy in 1970s, China has reduced 300 million births, which is more than the total population of the United States. Energy consumption and greenhouse gas emissions ultimately arise from the demands of residents. The efforts in reforestation and returning farmlands to forests and grassland enable China’s forest coverage to rise from 13% in 1980s to the current level of 18%, increasing the carbon sequestration dramatically. Thanks to China’s policies on energy conservation and energy efficiency, the coal consumption per unit electricity output has dropped from over 400g/kwh to the current 350g/kwh, and the integrated energy consumption per ton of steel has reduced to 0.85 ton compared with 1.2 tons in 1980s. China devoted much to the development of renewable energy, which includes hydro-energy, wind energy, and solar energy. China’s bid to reduce energy consumption per unit GDP by 20% during the Eleventh Five-Year Plan period will no doubt contribute largely to greenhouse gas emissions.

China needs to take actions to protect the global climate. In fact, China has been taking positive actions. It approved the Kyoto Protocol, and is actively engaged in CDM (Clean Development Mechanism) programs. As one party to Asia-Pacific Partnership on Clean Development and Climate, China is devoted to the development of and cooperation on clean energy technology, together with the United States, Japan, Australia, India and South Korea. China has conducted extensive cooperation with EU as well on carbon capture and storage, and development of renewable energy. Actually, it is the voluntary commitment of China to vigorously promote energy conservation, and the development of renewable energy. International cooperation is necessary for promoting China’s further actions. At the same time, as a developing country, China has low level of economic development and a large population. It is proper for China to give priority to satisfying basic needs in terms of energy consumption. Efforts should be made to control extravagance and luxurious consumption.

3.2 Challenge 2: Increasingly Severe Water Crisis

As a strategic resource, water resources will constitute a bottleneck for China’s future development, and water crisis is the primary issue concerning environmental security for China. At present, water issues in China today can be summarized as follows: the co-existence of lack of water and water being wasted, the prominence of the water pollution, the serious damages to environment, and the threat of flooding still looming etc.

3.2.1 water scarcity and water squandering

The absolute amount of water in China is not a small number, but the per capita water resource is far below the world par and the temporal and spatial distribution is uneven. The exploitation is very difficult. At present, the amount of water resources which can be exploited is about 800 billion m3and the per capita supply less than 530 m3. Since 1990, the water shortage has resulted in a reduction in crops more between 10 million cubic meters to 50 million cubic meters. There is still a population of 23 million who have difficulty in access to drinkable water.

Besides the total amount of water resources, the problem of water resources not being commensurate with productivity is prominent, which has led to water shortage not only in the north, but also in the south. By 2030, the water need will be approaching the total amount of usable water recourse, i.e. the upper limit.

Many cities in China are confronted with the problem of water shortage. Among 661 cities, about 420 cities are short of water, among which 114 cities are in severe water shortage. Some of the northern cities are even forced to limit the quantity of water provided. The daily water shortage in cities has reached 16 million cubic meters and the annual water shortage 6 billion cubic meters. According to rough estimation, annual economic loss owing to the shortage of water has reached 200 billion RMB Yuan. With the expansion of cities, the problem of water shortage will still exist and become even more serious.

With more severe water pollution, over-exploitation of underground water, and squandering, the issue of resourcewise water shortage will be exaggerated. In 2004, among those major 15 cities through which 7 biggest rivers ran， channels in 13 cities were heavily polluted, among which 16% reached Grade V while 36% even exceeded that limit. Throughout China, nearly half of sources for drinkable water in cities and towns are not up to par. And 26.5% of the coastal areas exceeded Grade IV. Urban water pollution mainly comes from industrial wastes and domestic sewage. And what’s more, domestic sewage has increased rapidly, which is gradually becoming the main factor of urban water pollution.

The over-exploitation of underground water in many cities has caused huge losses to underground water resources, brought about many geologic disasters such as ground settlement and fissures in the ground, and threatened the safety of cities and its people. For example, along Yangtze River, three regional settlement areas have been formed such as Shanghai, Suzhou-Wuxi-Changzhou Area in Jiangsu, Hangzhou-Jiaxing-Huzhou Area in Zhejiang etc. In such cities as Dalian, Qinhuangdao, Qindao, Yantai, Ningbo, Beihai and Laizhou, there has been a serious problem of sea water erosion. What’s more, there has been squandering and low efficiency of water use both for industrial and household use in cities. With the urbanization process, the cities in China will be confronted with three serious issues, that is, water shortage, sewage disposal and water environment control.

Table 1. the annual water demand in the future for China (unit: 100 million m³)

For a long time, the water conservation has been neglected, which has given rise to the low efficiency of water use either for industrial, agricultural or even household purpose and great squandering. One m3 of water can yield 1 Kg crops only while it can be 2 kgs in the developed countries. The water amount for each 10 thousand RMB Yuan output in industry is 91 m3, 5 or even 10 times of that of the developed countries. For each one ton of steel, the water use is 3 to 5 cubic meters in the developed counties, but it would be over 70 cubic meters in China, and the water for refining each one ton oil would be 0.5 ton but China would be 2.43 cubic meters on average. With the increase of the population and the development of the industry and agriculture, if there are no water conservation measures taken, it is estimated that by 2030, there should be an additional amount of 200 billion cubic meters to 250 billion cubic meters of water in need.

The global climate change might have both positive and negative impacts at the same time which is not certain to date, but it is very likely that in the draught year it will worsen the water shortage problem in the North and Northwest of China. However, it will increase the precipitation in the upper reach of the Yangtze River and it brings more disasters too.

To solve the problem of water shortage, Chinese government has taken series of measures on water conservation and has been undertaking several huge water diversion works, which might have alleviated the problem of water shortage by 2020.

3.2.2 water pollution

The total amount of industrial and urban wastewater is 63 billion cubic meters each year with annual increase of 1.8 billion cubic meters. About 80% of the wastewater is discharged into natural waters without any treatment. In theory, this wastewater can pollute all surface water across China. As a result, the Haihe River, Huaihe River and Liaohe River in northern China become dark and smelly, virtually becoming super drainage ditches. While the Taihu Lake, Chaohe Lake and Dianchi Lake in southern China almost lose their services due to severe eutrophication and occasional water algae bloom owing to the inflow of large number of organic pollutants. Today, water pollution is worsening and spreading from tributary to the mainstream, from cities to rural areas, from surface to the ground and from land to sea. At present, over 90% urban waters are under pollution, 700 million people drink water with the concentration of colibacillus exceeding national standards and the drinking water for 170 million people has been polluted by the organic pollutants. At present, in 61% of all the cities in China, there are no sewage treatment plants. The treatment percentage of urban sewage is only 42% and among all the installed treatment facilities in the cities, one third has been operating and stopping from time to time, and another one third do not operate at all. To a large extent, water pollution is the cause for water shortage and vice versa: on the one hand, water shortage makes it hard to dilute pollutants; on the other hand, pollution damages limited water resources and greatly deteriorates water supply. To solve this problem, Chinese government has been adopting effective measures to prevent and control water pollution. It is predicted that water pollution in those areas with a well-developed economy can be effectively curbed much earlier than those with a relatively less developed economy. By 2020, the problem of water pollution in China is very likely to be alleviated.

3.2.3. Overexploitation of the water and land resources and the degradation of ecosystem

Over the years, the industrial and agricultural activities and development have seriously damaged the forest, grassland, lakes, wetland which are closely associated with conserving the water source and as a result, it has aggravated the phenomenon of water shortage but also caused water loss in large areas and the potential threat of flooding. The exploitation of Yellow River, Huai River and Hai River has exceeded 50% of their capacity which has damaged the watershed ecosystem. The area of groundwater which has been overexploited has been expanded from 87000 km2 in the 1980s to 180,000 km2 today. It has given rise to the serious ecological problems such as land cave-in, hardening of the water, and back flow of the sea water. Since 1950s, over 20 tributaries in the upper reach of the Yangtze River have shrunk averagely 37.1%, a loss of total lake area of 12,000 km2. The trend of soil loss in the upper reach has not been arrested basically, the living environment for the water lives has been damaged, and the shrinking of wetland caused by urbanization and exploitation has been very serious.

Nationwide, the intensity of the soil erosion has been abated, but the situation in general has not changed too much. The area of soil erosion accounts for 37.4% of the state land. 745 counties are still facing the problem of serious soil erosion, accounting for 33% of all the counties. The direct economic loss from the soil erosion was 64.3 billion RMB Yuan in 2002, 0.62% of the GDP. The soil erosion has worsened the poverty. Among the poor counties of national level, 59% of them have serious soil erosion problem. It deserves to note that the construction and development activities which have worsened soil erosion have become a new factor for soil erosion. In terms of soil and water conservation and desertification treatment, Chinese government has taken series of significant measures. Recently in some areas, the problems of soil erosion and desertification have been effectively curbed and by 2020 it is very likely that these problems will be solved.

3.3 Challenge 3: A Continuous and Rapid Increase Of Municipal Waste, Industrial Waste and Hazardous Waste

With the socio-economic development in China, the increase of the number and size of Chinese cities, and the improvement of people’s living standards, the amount and variety of solid wastes increase sharply, and become the pressing problems in need of quick fix for the further healthy development of society and economy. This report forecasts the prospect of China’s solid wastes by the year 2020, through analyzing and summarizing the production, disposal, treatment, and recycling of domestic wastes, industrial solid wastes, hazardous wastes and imported wastes in China, discussing the major factors and drive that affect the change of solid wastes, and prospecting the visions of the production, disposal, treatment, recycling, and managerial mode of China’s solid wastes. The details are as follows.

3.3.1 Municipal Wastes

With the rapid urbanization rate and the improvement of the consumption capacity, the urban domestic wastes is about to witness sharp increase, and rural domestic wastes becomes prominent and by 2020, regarding the environmental protection, the urban and rural areas will face a stern challenge posed by the domestic wastes.

According to forecasts of China’s urbanization trend, the proportion of urban population will have come up to 43% and 60% respectively by 2010 and 2020, when 600 million and 863 million people will live in cities in China. Calculated at the current wastes output in Chinese cities of 444 kg/person, 264 billion and 398 billion tons of domestic wastes will be generated respectively in 2010 and 2020.

Municipal wastes in China have posed great pressures on the development of cities. Firstly, with an increasing amount of Municipal wastes, there has been heavier pressure on cities in terms of the disposal and comprehensive utilization of Municipal wastes. In 2004, the amount of solid industrial wastes in China reached 1.2 billion tons, an increase of over 0.4 billion tons over that of 2000. The amount of urban domestic wastes has been on steady and sharp rise. In 1980, it was less than 0.05 billion tons but in 2004 reached 0.34 billion tons with an annual increase rate of 8.5%. On average, the innocuous treatment rate of urban domestic wastes is 57.76%. And in about 160 cities, there is no such kind of treatment at all. About two-thirds of cities in China have been surrounded by domestic wastes. Huge amount of rubbish and wastes is simply buried underground or piled upon on the ground in the suburbs of cities or along the banks of rivers or lakes, which has brought many problems such as water pollution, shrinking water quality and widespread epidemics etc. Secondly, the impacts of hazardous wastes upon the environment have become quite serious. In 2004, the amount of hazardous wastes reached 9.63 million tons. However, there has been a rather low innocuous treatment rate. In 2004, in among 155 cities, there was no innocuous treatment of hazardous wastes at all. The hazardous wastes being directly discharged into the environment without such innocuous treatment accounted for a rather high percentage, which threatened the safety of the environment and people’s health.

At present, the annual per capita domestic wastes in cities is about 440 kilograms. And especially in those municipalities and capitals of provinces, people produce more domestic wastes. About 60% of the total domestic wastes has been produced by the people in those 52 cities with a population of over 0.5 billion. At the same time, with fast economic growth and improved living standards, there has been a trend of the rapid increase of domestic wastes in the medium-sized and small-sized cities. According to forecasts of China’s urbanization trend, the proportion of urban population will have come up to 43% and 60% respectively by 2010 and 2020, when 600 million and 863 million people will live in cities in China. Calculated at the current wastes output in Chinese cities of 444 kg/person, 264 billion and 398 billion tons of domestic wastes will be generated respectively in 2010 and 2020.

No statistics are available for domestic wastes in rural areas, but it will experience rapid increase from a quantitative perspective. In recent years, along with China’s fast economic growth in rural areas and improving living standards of rural residents, the amount of rural domestic wastes grows steadily, with more complex composition and difficulty in treatment. Pollution caused by rural domestic wastes has become one of the major elements affecting the production and life of rural residents, rural urbanization drive and sustainable development. Meanwhile, due to the improvement of rural living conditions, the popularization of gases, and the increase in applying chemical fertilizers, a large quantity of organic wastes, such as stalks, fruit vines, and straws, fails to be utilized or returned to the farmland, and is discarded instead as wastes. This has considerably increased the domestic wastes in rural areas, which creates increasingly bigger hazards. Therefore, given the development trend of China’s rural domestic wastes, this problem tends to emerge at present. By 2020, rural environmental protection will face stern challenges from the issue of rural domestic wastes. The Chinese Government should attach great importance to this issue.

3.3.2 Industrial Wastes

Along with the expansion of the industrial scale, the industrial restructuring and the improvement of the industrial technologies, the volume of the solid industrial wastes for reuse will be increasing. However, since the industrial level on the whole is still relatively backward, the efficiency of raw material and energy use is still quite low, and the industry is still on the stage of rapid development and featured by heavy chemicals. Therefore, the amount of solid wastes to be discharged into the environment will be likely to increase and it is possible to reach the peak by 2020.

With the expansion of industrial scale, industrial restructuring and rising technical level, more and more industrial solid wastes are under comprehensive utilization. However, more and more industrial solid wastes are discharged into the environment in the process of rapid industrial development due to overall backward industrial level, low utilization rate of raw materials and poor energy efficiency in China. Nearly 20 million tons of industrial solid wastes are discharged directly into the environment each year, and another 26 million tons are just stored without proper ultimate treatment. Therefore, high-speed industrial development creates great pressure on the environment.

If China further changes its concept on the management of industrial solid wastes, promotes cleaner production, and vigorously develop circular economy, China’s industrial solid wastes will reach full load before the year 2020 in accordance with inertial development.

3.3.3 Hazardous wastes

With the rapid industrial and national economic development in China, if no measures adopted to reduce hazardous wastes per unit of output, it will see an exponential growth of pollution caused by hazardous wastes which synchronizes industrial GDP growth. By 2020, discharge of hazardous wastes will exceed environmental carrying capacity by a large margin and it is liable to bring about secondary pollution.

With the rapid industrial and national economic development in China, if no measures adopted to reduce hazardous wastes per unit of output, it will see an exponential growth of pollution caused by hazardous waste which synchronizes industrial GDP growth. In reality, more investment will be made in environmental protection as the economy continues to grow and pollution caused by hazardous waste per unit of output will also drop. However, if the investment is not big enough or environmental technologies are backward, such a tendency of reduced pollution will slow down, falling behind economic growth in the long run. Finally, pollution will hover around a fixed value above zero and can not be eliminated. Pushed by the growth of GNP, pollution load of hazardous waste is bound to increase, exceeding the carrying capacity of the environment. In another circumstance, environmental load for hazardous wastes per unit output will surpass industrial growth rate, leading to sustainable industrial growth with zero discharge of pollutants. The objective of environmental decision-making is to optimize management scheme of planning so that load of hazardous wastes will reach its peak as soon as possible on the premise that the load will not exceed environmental carrying capacity. The peak value should be kept at a possibly lower level.

3.3.4 Imported Wastes

With the rapid economic development in China, the level of resources shortage will be even higher. And meanwhile the advantage of the low-cost labor is becoming obvious and yet our environmental management is far lagging behind that of the foreign countries. All of these factors will contribute to the constant and even sharp increase in the import of the wastes either legally or illegally. As such, the government of China should further strengthen the environmental management of the importing wastes and exercise the whole process environmental management of the importing wastes.

China has been importing wastes for a dozen of years, which are used as raw materials. The amount of imported wastes has maintained a momentum of fast growth. In 2004, the total import of wastes stood at 33.08 million tons, or USD 9.3 billion.

Electronic wastes from foreign countries also surged into China on a large scale, spreading from Guangdong Province to other provinces such as Hunan, Zhejiang, Shanghai, Tianjin, Fujian and Shandong. Though the Chinese government has banned the import of electronic wastes, and Basel Convention stipulates that it bans exporting all hazardous wastes in any reason from developed countries to developing countries, however, the spread of electronic wastes in China is still worrying. According to statistics, among the alarmingly increasing amount of electronic wastes, 80% are exported to Asia, of which 90% entering China. This can be attributed to two factors: one is profit and the other is the inadequacy of laws and policies in China. In the meantime, some export countries are to blame for failure to observe Basel Convention.

3.3.5 Summary

The research above shows that the development trend of the solid wastes in China will present the co-existence of challenges and opportunities. Reuse of solid wastes has become the core and key field in fulfilling China’s strategy of building a resource-efficient and environment-friendly society. Currently, development of circular economy has been put as priority and on high agenda for economic growth and environmental protection.

Only through developing an environment-friendly and resource-efficient society, strengthening environmental management and promoting circular economy, can we achieve 3R with a view to curb the growth of solid wastes as China aims to quadruple its economic growth by 2020 while the increase of solid waste will not synchronize.

Reuse of solid wastes has become the core and key field in fulfilling China’s strategy of building a resource-efficient and environment-friendly society. Currently, development of circular economy has been put as priority and on high agenda for economic growth and environmental protection. Strengthened management of wastes, the application of advanced technology in reuse and recycling of waste and the development of a resource-efficient and environment-friendly society will continuously promote China in recycling and reusing of solid wastes, reducing the generation and release of solid wastes. At the Sixth National Conference on Environmental Protection held in April 2006, it has explicitly put forward the strategy of three transformations, and vigorously developing circular economy is an important means to achieve this goal.

3.4 Challenge 4: Degraded Ecosystem and Loss of Biodiversity

China has made a series of achievements in such aspects as the establishment of nature reserves, the conservation of endangered species, the protection and recovery of forests. However, the ecosystems are still very fragile, and on a whole, the trend of loss of biodiversity and the worsening ecosystem has not been curbed with the following reflections:

3.4.1 the degradation of the ecosystem service

In 2000, the ecological quality assessment made by SEPA showed that nearly one third of the national land ecosystem was fine, but one third of them was bad or fairly bad.

The forest system has been for long over-exploited and it reached the peak in 1990s and the primitive forest was left little and the fragmentation of the forest vegetation is severe which has resulted in the bad function of the water conservation out of the soil erosion and the loss of habitats for the wildlife. The extraordinary flooding in Yangtze River and Songhua River has prompted the central government of China to make the resolve of banning logging and implementing the virgin forest conservation project. After that, 6 major forestry projects were launched, so as to recover and retrieve the forestry resource and the eco-system in China. However, the status and trend of the forestry resource in China is not optimistic. In general, the situation is as follows.

- Inadequate in total volume. The forestry coverage in China is only 61.52% of that of the world average.

- Uneven distribution. The 5 provinces and regions in the northwest of China accounting for 32.19% of the national land have a forestry coverage of only 5.86%.

- Poor quality. The management of artificial forest is not at a high level, attaching importance to planting but not to caring, and the issue of mono-species is also serious. The health of forest faces challenges, and the introduction of alien trees posed potential threat to the local biodiversity.

- Serious forestry loss. At present, the annual loss of forestry land nationwide has been 739.4 thousand hectares.

- Still serious over-logging. Annually the amount of logging exceeding the quota has been an average of 755.421 million cube meters.

Due to the decreased quality of the forest, as well as the logging-ban of the virgin forest for the conservation of forestry of public goods, the production of forest in China since 1998 has dramatically decreased and there has been increasingly huge demand for timber as raw materials with the rapid economic development, resulting in a sharp increase of the import of forestry resources. And the import of them will be inevitable in a fairly long run, while the export countries and areas are also facing the problem of exhausting the forest. We therefore have to make a rational arrangement for the demand and importing of forestry resources in the context of the global sustainable use of the forest.

China is a country with large area of grassland, 0.4 billion ha of various natural grassland, accounting for 41.7% of the national land, 64% of the national vegetation. For a long term, due to the impact of the various factors such as the human and nature, the 90% of the usable grassland has degraded to a certain extent and the degrading area has increased with additional 2 million ha annually. The situation of the partially treated, generally deteriorating is yet to be fully controlled. The overloading for the grassland is very serious, the rate in the north is normally 36.1% and there is no chance for the grassland to rehabilitate and the productivity of the grassland has been decreasing, which will affect badly the soil itself.

At present, the large-scaled ecological conservation and construction drive has been launched. Some preliminary effects have been brought about in terms of grassland protection and project construction. The grassland covered in the projects has seen obvious recovery and the productivity has improved. Grazing ban and rehabilitation pilot work has been undergoing successfully. The areas for graze-ban and rehabilitation in the Inner Mongolia, Ningxia, Jilin, Gansu, Sichuan, Yunnan Provinces and Regions reach nearly 26.6 million ha . It is planned to take 5 years to make some recovery for the seriously degraded grassland the ecologically fragile area as well as the water head source of the major rivers. By 2020, the trend of the general degrading environment of the grassland will be basically brought under control.

The area of wetland in China (excepting the rice paddy field) is 38.48 million ha , ranking first in Asia, and 4th in the world. Among that, the natural wetland area is 36.2005 million ha , accounting for 3.77% of the national land. At present, the natural reserve of the wetland nationwide is 16 million hectares, and around 40% of the natural wetland has been effectively protected.

Due to the long-standing infringement upon the wetland and its development, the natural wetland has been shrinking by a large margin, and the disappearance and degrading still serious. Up to now, 50% of the wetland has been lost. According to the survey by the State Forestry Administration, among the 376 pieces of key wetlands, 117 pieces of wetlands have been or are being threatened by the blind development or transformation, accounting for 30.3% of the surveyed wetland. This threat mainly targets at the coastal area, the middle and lower reaches of the Yangtze River and the swamp area in the northeast of China. The exploitation, the change of its function and the urban development has been the major cause for the reduction in the area of the wetland as well as the degrading function of the wetland.

In the seas and lakes with economic value, the over fishing has been very rampant, which has not only damaged the natural economic fishery resources, but also seriously affected the ecological balance of the wetland and menaced the safety of the other water lives.

The soil erosion area nationwide is 3.67 million square kilometers, accounting for 38% of the national land. In recent years, the trend of soil erosion and soil damaging has been worsening. And nationwide the newly added soil erosion area has been 10000 square kms annually. The area of desertification has been expanding and area of that has been 2.62 million square kilometers in the past few years, with a expansion of more than 3400 kilometers each year. But this year the problem has been somewhat alleviated.

Due to the dual effects of climate change and human activities, the permanet ice area has been shrinking and the desert expanding. The various ecosystems are degrading to a certain extent. There is still some ecological carrying capacity in west China as a whole. But over capacity occurs in some other parts of China. Human influence on ecosystems is much bigger than in any time of the history. And eco services are on continuous degradation and will aggravate in the next 50 years.

Almost each kind of pollutant finally finds its way in soil. About 90% of pollutants in the world will finally be deposited in soil. Soil pollution has become a worldwide issue. In China, there has been quite heavy soil pollution. According to preliminary estimates, at least 13 million hectares of soil nationwide has been polluted by pesticides and over 0.1 million hectares of soil by industrial wastes. There has been a loss of over 10 million tons of grain reduction due to soil pollution. The agricultural economic loss due to soil pollution totaled 20 billion RMB Yuan. And the issue of food safety has become a serious concern for the urban residents.

3.4.2 The proportion of the endangered species still on the rise

It is generally thought that 15-20% of the fauna and flora in China are being threatened, above the world average level of 10-15%. In 2004, referring to the revised IUCN standards, the Chinese experts made an overall assessment of 11211 species in China and found that the proportion of the endangered species are as follows: invertebrates—34.74%, vertebrates—35.69%, gymnosperm—69.91%, angiosperm—86.68%. Those data, particularly the flora’s endangered ratio, is far exceeding the estimate made before. And for those extremely endangered species (sub species) such as white dolphin, long arm monkey of Hainan, South China tiger, Poor’s antelope, their future is not so optimistic within the next 15 years. And the damage of the seed gene has also been serious. In Guangdong and Hainan Provinces, the richest homes of the wild rice resources, among the 1182 distribution points of wild rice, 80% of them have disappeared. If this trend continues, the wild rice will vanish in China in the next 15 years. With the fast pace of the economic development and aggravating human activities, all that has resulted in the loss of habitats and fragmentation as well as the worsening of quality.

Out of luxurious consumption, the trade in wildlife constitutes the immediate reason for the reduction in the species and their extinction. It has also witnessed a sharp decrease in the number of the normal trading species, such as musk deer which was once widely spread. However, due to the rampant poaching, their number has reduced sharply and they have been upgraded to grade I protected animals from the grade II of state standard. Another example is giant salamander, recognized as a valuable specialty for meal. Due to the expensive illegal trading price, this animal is rarely seen in the wild. The wild Chinese turtle and the wild orchard are also rare in the wild. The trade and consumption of the wildlife has not only caused the ecological degradation, but also potential health problem. The spread of SARS in 2003, and the avian influenza in recent years have impressed the human beings greatly the correlation between the over-exploitation and the infecting diseases. The illegal trade in the wildlife contributed little to the economy, but its damage to China’s image is huge, and it has all the perils but no benefits.

3.4.3 Alien invasive species

The threat of the alien invasive species is wide and it involved various eco system. There are many of the invasive ones which has posed grave threat to the eco-system and social economy in China. In the context of the banning logging of the virgin forest, and forbidding the human damage to the ecology, the invasive alien species have become the major factor for degrading the eco-system and loss of biodiversity. Particularly it has become the numebr one factor for the water ecosystem, and the tropical area in the south and the sub-tropical area. These threats include loss of biodiversity, reducing the number and categories of the species, endangering and extinction of the species (alien fishes are the number one factor for endangering the local ones in Yunnan Province), the monontonous ecosytem or its degradation, the change of or damage to the natural scenes, and threats to the local genetic diversity etc. Meanwhile, it has posed great threat to the human health, and brought about huge economic loss to the agricultural, forestry and aquacultural sectors. A conservative estimate claimed that the annual economic loss might come to hundreds of billion RMB yuan.

On the whole, our protection on nature far lags behind the development and utilization of natural resources. Consequently, the vicious cycle of “eco-degradation—excessive utilization—more degradation—further utilization” occurs. On the one hand, poor population in remote areas falls into further poor life due to ecological degradation. On the other hand, a small percentage of wealthy people have conditions for fast transformation and accumulation between capital and resources, and this has accelerated ecological degradation. At present, over 90% rural poor live in areas with poor environment. At the same time, China’s demands for some resources have gone beyond the carrying capacity of land and resources due to steadily fast economic growth and low resource efficiency. As a result, China’s ecological footprint generates a decisive impact not only on China itself, but also on the whole world.

3.5 Challenge 5: Emerging Environmental Issues in the Future

Apart from the above well-known environmental problems, indoor environmental pollution, ground ozone pollution, mercury pollution as well as various types of diseases triggered by unsound environment would combine to form the emerging set of environmental problems in the future.

3.5.1 Indoor environmental pollution

Indoor environmental pollution is one of the most serious environmental problems in China, which is directly connected with health problems caused by environment. The level of particular matter (PM) is generally higher than that of the outdoor, surpassing 500 mg/m3 given cooking and heating is fuelled by biomass (or coal). In such case, the PM concentration in the kitchen would be the highest exceeding 1,000 mg/m3. In particular, a great portion of rural residents would be exposed to the environment with the pollution level failing to meet national and international standards if rural houses with unsound ventilation continue to utilize biomass fuels and raw coal extensively and inefficiently. As a result, these residents would fall victim to respiratory illness or even death. Housing decoration in urban areas and the use of higher-than-the-standard material for furniture would cause serious health problems to urban residents if indoor pollution is not rigorously controlled. In addition, the issue of the environmental pollution inside the cars will become more prominent.

3.5.2 Ground ozone

Ground ozone constitutes the major part for urban smog, mainly contributed by vehicles.

Ground ozone is mainly formed through the comprehensive functioning of water steam, NOX and volatile organic compounds in urban areas by the heat from the surface ground and sunlight. NOX is produced from vehicles and power plants when they are in the state of high temperature or combustion, while automobiles, chemical plants, refrigerator and many industrial and domestic products are the sources of volatile organic compounds. Generally speaking, the concentration of ground ozone increases from the morning with the edging up of resource consumption and air pollution level. In the afternoon, with daily temperature reaching the peak, the photochemical reaction of NOX and volatile organic compounds gives rise to the surging of the concentration of the ozone. The concentration begins to drop in the evening. As indicated by scientific research, ground ozone often appears higher concentration level in sunny and high air pressure weather. As trusted by the United Nations Economic Commission for Europe (UNECE), researchers from Great Britain conducted a detailed investigation in 2002 focusing on the hazard of ground ozone pollution involving 45 countries in Europe and the former Soviet Union. The investigation shows that Europe loses around 6 billion Euro Dollars in its agriculture sector each year due to the damage of ozone smog, among which France is the largest sufferer with 1.5 billion Euro Dollar losses each year followed by Germany of 1 billion Euro Dollars and 200 million Euro Dollars for Great Britain. The investigation also demonstrates that different agricultural products respond differently to the ozone pollution. For example, vineyards almost show no impact while wheat, potato and beans are among the ranges of the hardest hit. Around one third of the total loss incurred in European agriculture by ozone pollution is from wheat and one fifth from potato. Furthermore, ozone pollution causes great damage to herding grasslands. In this connection, the loss of European agriculture by ozone pollution will increase by 4 billion Euro Dollars if such indirect losses in the production of meat and milk from ozone pollution are also taken into account. In addition, as shown by the study results by the Department of Forestry and Environment of Yale University of the US published in the Journal of American Pharmaceutical Association in November of 2004, ozone pollution can cause pre-mature death of humans. This study, sponsored by US EPA, had made a comparative survey between the change of mortality rate and the local atmospheric ozone pollution level from 1987 to 2000 in 95 cities covering around 40% population of the US. The results indicate that the daily mortality rate of the people surveyed would increase by 0.52% in the following week after a weekly increase of one billionth concentration of ozone pollution, and the mortality rate from cardiovascular and respiratory diseases would consequently climb 0.64% and even higher as 0.70% for the elderly aged within 65~74. Another 4,000 lives can be saved in the US annually if the amount of such pollutants in the lower layer of the atmosphere can be cut down by around 35%.

Due to the damage of ground ozone, the EU started to perform the ozone pollution reporting system from September of 2003. As per this system, all the EU member countries must master and analyze its concentration of ozone in the troposphere. Relevant report should be immediately made to the public if the ozone concentration surpasses 180 µg/m3. In a bid to control the ozone concentration under the warning line of 240 µg/m3, relevant countries will take measures of restricting highway transportation and use of paint-solvents etc. In the US, 36 governmental organizations have embarked on the joint move of cutting ground ozone pollution. The Organization of Smog Removal Cooperation in Georgia is one of them composed of 120 local governmental organizations, universities and private companies. This organization has laid down the warning grades for smog concentration based on study and called for the public to reduce ground ozone pollution via mass media of radio and TV broadcast, etc. Besides, it has also called for the public to take more public transportation and handle such works of car refueling, lawn trimming, spray-painting and running diesel-engine vehicles at night.

With the increase of vehicles, the problem of ground ozone will be even worse in China’s urban areas. Now China has not yet started to control ground ozone in a comprehensive manner.

3.5.3 Mercury Pollution

As a new pollutant, mercury is gradually being recognized by people.

Mercury is the only metal element existing in the form of liquid, and it can be volatilized into the air under normal temperature. A portion of the mercury coming into the air can deposit onto the ground and into the ocean in the local or regional area near the discharging source together with dust and rain, while the rest will circulate globally with atmospheric circumference. Mercury can also be transmitted to other parts of the world with the movement of oceans. It has already been listed as a global pollutant by United Nations Environment Program (UNEP) and is the only chemical substance exerting global impact and having the quality of trans-national pollution apart from greenhouse gases (GHG). On February 3rd of 2003, UNEP released its Global Mercury Assessment in Nairobi, indicating that the amount of mercury in atmosphere, water and soil almost tripled since the industrial revolution and the amount of mercury in places around industrial areas is even higher. Presently, the steady increase of mercury amount worldwide is mostly attributable to human activities. The annual discharge amount of mercury into the atmosphere from various anthropogenic pollution sources ranges from 1,900 to 2,200 tons, among which 1,500 tons is from coal-based thermal power plants and refuse incineration, accounting for 70% of the total. Asian countries take up 860 tons of the total amount and stands at the first place globally followed by Africa, Europe and North America. Since China is heavily dependant on the burning of coal for power generation, the discharge of mercury inevitably represents a big share of the world’s total. As also demonstrated by the report, the level of mercury contained in the body of one twelfth or around 5 million women in the US is higher than the safety standard, and there are as many as 300,000 newborn babies with defects in their mental and nervous system by mercury pollution each year with the figure possibly mounting to tens of million worldwide. Mercury can be regarded as a chemical substance of acute physiological toxicity. It can enter into human body via respiratory tract, esophagus and the skin, and over-absorption of mercury could lead to mercury poisoning. A series of international studies all show that the damage of methyl mercury to human is much more serious than previously anticipated and any form of mercury in the environment can be transformed into the virulent methyl mercury under certain conditions. After entering the human body, methyl mercury will invade the nerve system of human, especially the central nerve system. Relevant pathological study has proven that methyl mercury can penetrate the barrier of placenta to harm fetus, causing congenital diseases to newborn babies. Mercury pollution can cause heart diseases, hypertension and cardiovascular diseases as well, and it can affect the normal function of liver, hypothyroid and the skin of human beings. Methyl mercury in the natural environment is mainly the resultant from mercury and other compounds under the functioning of microorganism in the water body and the soil and can be passed along the aquatic food chain for high density of bio-accumulation. The amount of mercury contained in larger oceanic fish species at the top of the food chain such as shark, swordfish, tuna, hairtail and seal dog is of the highest level, while the amount of methyl mercury in the predatory fish species on the top of the food chain in ponds, lakes and rivers is also of the largest. We human beings would also be exposed to the harm of methyl mercury from the taking of fish, shellfish and marine mammals polluted by mercury.

3.5.4 Health Problems Caused by Environmental Pollution

There are more and more environment-related health problems. Health represents harmony between men and nature. Once such a balance is broken, people’s health will be affected and diseases occur. Major problems concerning environment and health of our times are as follows:

The production activities of human beings not only alter the composition of chemical elements and chemical substances at the surface of our earth and speed up the cycling of harmful elements such as heavy metals in ecosystem, but also discharge a great number of non-existing chemical synthetics into the environment. These elements and compounds would ultimately affect the ecosystem and human health. In particular, the long-term impact of persistent organic pollutants (POPs) on health, which is difficult to degrade, has attracted great concern as one of the global environmental issues.

The ecological damage from human activities has already undermined the health of human itself. Desertification and land desertification can exert direct impact on food security in drought-stricken areas on the one hand and result in the increase of sand storm weathers in adjacent or neighboring regions on the other. As a result, the amount of inhalable PM in the air will be on the rise, posing threat to health. The loss of biodiversity would reduce the productivity of ecosystem, thus diminishing nature’s ability in providing materials and services to human being and shaking as well as weakening the capability of ecosystem to withstand natural disasters of flooding, drought and storm. Abusive hunting and reckless eating of wild animal species have broken the dividing line between human being and wild animals, adding to the potentials of transmission of infectious diseases from animals to human. Along with global warming and human damage to ecosystem comes the possible resurgence of some long-existing infectious diseases in China. For example, China is still a nation with a high epidemic rate of TB worldwide, and the number of active TB patients mounted to around 5 million in 2000 nationwide with even upward trend in some regions. Meanwhile, some new forms of contagious diseases such as Lyme disease and AIDs are showing a gradually accelerating growth in China.

Climate change can induce corresponding change in the ecology and the environment, resulting in crucial changes to the geological epidemic characters (e.g. the expansion of epidemic scope) of a range of organism focus-based diseases including diarrhea, schistosomiasis, trypanosomiasis, yellow fever, Pasteurella Pestis and cholera. In recent years, besides the potential resurgence of some basically extinct infectious diseases such as TB, new infectious diseases such as SARS and monkeypox emerge threatening the life and safety of human beings. What’s more, climate, ecological and environmental changes also create the shift of the balance of environmental life elements, thus changing epidemic rules of related diseases such as endemic.

Diseases related to environmental chemical factors mainly include endemic diseases caused by insufficient or surplus of life elements in the primary environment as well as environmental health problems incurred by pollution. China is the hardest-hit country by endemic diseases, and fluorine poisoning caused by high concentration of fluorine in drinking water and the pollution from high fluorine concentration in domestic coal burning has covered 1,063 counties in 28 provinces (cities and districts) nationwide with a population of 70 million in the endemic-afflicted areas. 30 million patients have been identified at present. The area under the control of arsenic poisoning caused by high concentration of arsenic in drinking water and the pollution from high arsenic concentration in domestic coal burning has expanded to provinces of Inner Mongolia, Shanxi, Ningxia and Guizhou, covering a total population of 2 million. The endemic area demonstrates a trend of further widening with the ongoing of relevant survey. Iodine deficiency incurred by the lack of iodine can be found in 2,300 counties in 29 provinces. The endemic area of Keshan and Kaschin-Beck diseases caused by iodine-deficiency has a population of around 50 million, and such diseases still plague provinces and regions of Tibet, Qinghai and Shanxi. Diseases related to environmental pollution include the chronic poisoning by heavy metals and their long-lasting damage, such as the harm of lead on the intelligence development of children, impact of SO2 and NOX in the air on respiratory diseases, the long-standing harm of the pollution from pesticides and organic pollutants, especially in terms of their harm to human reproductive ability and their carcinogenic nature.

3.5.5 Newly Emerging Environmental Problems Brought about by New Technologies

Biotechnology and nanotechnology are the potential driving force for future economic activities. Inevitably they will have huge impacts on industrial manufacturing, production and environmental technologies etc. Apart from the assessment on products about their influences on people’s health, safety and environment, environmental assessment and monitoring should be conducted within the whole sector. A stricter environmental monitoring system should be established to make sure that huge amount of investment in biotechnology and other innovative technologies will eventually do great good to both economy and environment. Among those problems, the environmental influence by biotechnology should deserve special attention.

3.5.6 Other Emerging Environmental Issues

Other emerging environmental issues are also worth noting such as soil pollution, underground water pollution and electronic wastes pollution etc.

3.6 Challenge 6: Continuously Worsening Global Environment

Global environmental issues have become increasingly outstanding in the context of globalization. Global environment in 2020 will be influenced by two determining factors: the potential discharge of global pollutants and effective global environmental governance. As a big developing country, China’s development goal for building a overall Xiaokang society in 2020 and its role in global political structure in the future will have a great impact on world environment.

With the progress of globalization, international environmental issues have begun to take on complicated political, economic, legal and institutional trend, substantially affecting the political and economic interests and national environmental security of each country. As far as global and regional scope is concerned, global environment keeps deteriorating, and regional environmental disputes become more and more outstanding at present. All these problems have transcended the traditional category, intertwining with national sovereignty, diplomacy, economy and trade and environmental security, and drawing increasingly extensive concern from international communities.

As generally recognized internationally, major environmental problems around the globe of our times include the following : the depletion and damage of ozone layer; climate change marked by global warming; rapid loss of biodiversity; land degradation and desertification; worsening marine environment; and pollution caused by chemical substances etc.

The above-mentioned problems will directly influence the existence and sustainable development of human beings. Take climate change issue for example. It’s undisputable that climate change has already exerted its influence upon various parts of human social life, and the frequent occurrence of extreme weather events in 2004 also had connections to climate change to a certain extent. Another example is biodiversity which may not demonstrate huge impact on our present daily life but would have far-reaching significance to the existence and development of the entire human race.

International environmental problems are distinctively featured by the following characteristics:

3.6.1 Environmental problems becoming more closely associated with international politics, economy and trade as well as societies and the various environmental problems are correlated.

A growing number of environmental problems are increasingly associated with international politics, economy and trade as well as societies. Take climate change as an example. It’s not merely an environmental problem but more a political and economic one. Under the GHGs emission reduction and limit mechanism established by the Kyoto Protocol, the space for GHG emission in the atmosphere conspicuously becomes a kind of scarce economic resource. Ownership of this kind of resource will consequently engender GHG emission rights and the room for economic development. To this end, the negotiations on the issues relating the United Nations Framework Convention on Climate Change (UNFCCC) and its Kyoto Protocol are becoming more and more heated. It is because of this reason that the US refused to ratify the Kyoto Protocol in the interest of its internal groups. In contrast, Russia approved the Kyoto Protocol in this year in order to gain a bigger share of international interests.

Various environmental problems are becoming more and more interlinked such as the connection between climate change and the depletion of ozone layer, and one between biodiversity and desertification and so on. How to reinforce cooperation among different conventions would be the primary concern of international communities in the future.

3.6.2 Most of the global environmental problems remaining on the trend of further deterioration

By 2020, most of the global environmental problems remain on the trend of further deterioration judged from the present situation. Take POPs for example. Such substances have been detected in soils in different nations around the globe, and varieties of POPs have also been found inside human body. On October 18, 2004, Worldwide Fund for Nature (WWF) released a blood testing result, indicating that 55 kinds of harmful or even carcinogenic substances including DDT were detected in the blood of 13 EU environmental ministers. As for climate change, as shown by the simulated GHG emission situation indicated in the 3rd Assessment Report by the Intergovernmental Panel on Climate Change (IPCC), the GHG emission from human activities will raise the atmospheric CO2 concentration from 280 ppm before industrial revolution to 540~970 ppm by 2100. And the situation may not be alleviated by 2020. There is no optimistic sign about the improvement of other global environmental issues by 2020 such as biodiversity, marine pollution and desertification.

3.6.3 Only few international environmental problems improved

Generally speaking, global environmental problems are evolving on the trend of further deterioration. However, with great endeavor of international communities, a few number of international environmental problems have been somewhat curbed. And the most typical example is the issue on the depletion of ozone layer. Due to the special mechanism arrangement for ODS, especially the support of effective financing mechanism, developing countries have contributed vital efforts in ODS reduction, among which China made great contributions by cutting down over half of total world volume.

3.6.4 Environmental problems related to world trade coming into focus

Environmental problems connected with world trade will become more and more pre-eminent with the dramatic increase in the global trade volume.

The effect of scales and structure of trade will lead to environmental changes. Due to the global trade, intensive resources-consuming products can flow from one country to another, so as to change the total volume of output and the production structure of the exporting country, and lead to the heavy burden on the resources and environment for the exporting country. At present, the large volume of textiles and iron and steel exported by China has resulted in the increase in the waste water from the textile and printing as well as the increase in the emission of air pollutants.

Trade can also lead to the environmental change out of its product effect. Due to the global trade, the products with obvious or potential pollution features may flow from one country to another. At present, the used and waste electronic goods imported into China have brought about far-reaching and profound impacts on the soil, ground waster, and people’s health in China.

3.6.5 The Lack of good global environmental governance system to address global environmental issues

Absence of effective global environment governance is responsible for continued deterioration of global environmental issues apart from persistent discharge of pollutants worldwide. UNEP, UNDP and other organizations under the framework of United Nations all have institutional deficiencies that restrain from effective management. Multilateral environmental agreements and their secretariats have limited coordination capabilities, particularly the ability in establishing and enforcing a mechanism for convention compliance.

In fact, the current UNEP is still a relatively powerless organization, whose main problems lie in its coverage of wide range of issues, limited exertion of rights, and a big discrepancy between the number of its staff, insufficient funds and large amount of work. It is universally recognized that UNEP is supposed to be in charge of monitoring the changes of environmental conditions. An UN Environmetnal Organization (UNEO) should be established to exert more influences. UNEO interacts with WTO and other economic organizations, thus revealing the nature that global environment is closely interwoven with global economy. But agreements have been reached among all countries, and environmental groups as to whether to establish UNEO, or just strengthen the construction of current environmental organizations.

The current international and domestic organizations and groups involved in environment and development affairs will still act as the driving force in the next five years. The organizations empowered with carrying out international treaties include UNEP, GEF, UNCSD, the department in charge of environmental issues under UNDP, other UN agencies and secretariats, and other departments. There are still some regional organizations which have made commitments to maintaining a good environment and sustainable development such as ASEAN, APEC, some departments of main development banks in charge of environmental affairs. In addition, environmental departments and bureaus in each country, some non-governmental organizations such as IUCN, WWF, WBCSD, IIED, WRI, IISD and some other agencies will contribute a lot. For example, agencies in the reinsurance industry have expressed the wish to quicken their pace and keep up with climate change.

People have reached the agreement on at least one issue, that is, international and national moves under the framework of the current MEAs are too slow. Usually few measures will be taken to punish those countries where no clear objectives have been met. Sanctions are seldom imposed on those who refuse to cooperate. There isn’t any dispute-settling mechanism. And even if there is one, it is quite powerless and mainly in charge of coordinating between the current MEAs and trading agreements and other treaties. Obviously, the framework and conventions established by the Global Summit in Rio de Janeiro in 1992 were quite meaningful and precious, but its impacts on international structural change and economic changes in some countries and areas were not fully appreciated until the present day. In fact, these conventions are now gradually being adopted and combined in the national legislation process.

The in-depth reason lies in that major developed countries in the world lack political will to improve world environment and the sense of responsibility for global environment. The present deteriorated global environment is mainly caused by developed countries in their industrialization process either in terms of GHG or ozone layer protection. However, developed countries do not have the sense of responsibility and blame the failure to protect environment on developing countries. On the other hand, developing countries, due to their political weakness in international arena, cannot lead the process of establishing global environment governance. Thus such a situation of lack of global environmental governance regime takes hold.

In the past 35 years, China has benefited a lot from the international environmental decision-making process at many meetings from Stockholm in 1972 and the World Summits in 1992 and 2002 etc. China has signed nearly all conventions and treaties in these meetings and other global conferences. And it is also the first to set up its national agenda for the 21st century. So China has a lot of opportunities to put those ideas and experiences concerning global environmental management into practice while realizing its rapid domestic economic growth.

3.7 Challenge 7: China’s Increasing External Environmental Impacts with a Rapid Economy

China’s economy has maintained an annual average growth rate of around 9% since 1978, which is greatly appreciated by the rest of the world. However, a lot of people also feel worried about the tremendous expense of China’s economic growth at the cost of its domestic and even global environment during its ever-deepening integration with the global economy. It’s true that inevitably China’s booming economy will bring about huge external environmental impacts. And Chinese government has taken serious attitudes to deal with these problems and adopted series of effective measures. But some western media exaggerated China’s negative impacts on global environment. The view playing up ‘China Environmental Threat’ also spreads in western world, which purported that China’s economic growth constitutes grave threat to the environment of other countries or even the whole world. Meanwhile, such views as China’s carrying out the policy of new colonialism in African countries also appeared in some mainstream western medias, such as New York Times, Financial Times. All these are not based on the facts. Through survey and the analysis according to International Law, we have come to following conclusions.

3.7.1 China’s Development is Conducted under the current international legal Framework

China’s trade practices accused by some westerners as damaging the environment such as trade in oil, minerals and legal timber trade, all fall into the category of legal and free trade under WTO legal system. They are not involved in MEAs or fall into the blank or grey area of these laws. Even if some laws have provided principles on environmental protection, there are no explicit provisions restricting such trade practices. China trades with its partners in accordance with the principle of free trade instead of violating any of the international laws.

Even though the trade between China and its partners has exerted environmental impacts sometimes, the responsibility should be borne by all parties, including manufacturers, consumers and traders of the whole product chain rather than China itself. As the product chain extends, the end users are often western countries. For example, it is said that China has posed threat to tropical forests by importing timber from Southeast Asian countries. Nonetheless, 70% of the timber are made into furniture and then exported to overseas market in EU and US. China’s environmental impact on Southeast Asia is far more exaggerated than the economic benefits it brings to the region.

3.7.2 Only a Little Of External Environmental Impacts is Caused by Poor Enforcement of the International Treaty

For instance, during the implementation of CITES, we find that the illegal import of ivory by Chinese firms does have some external environmental impact. But China is also a victim to such illegal activities. A case in point is smuggling of cashmere made from Tibet antelope in international market, which leads to dramatic decline in the number of Tibet antelope population.

3.7.3 Positive External Environmental Impacts Stimulated By China’s Development are Fully Neglected by The Western media

China’s development not only brings about external environmental impact, but also is influenced by outside environment. Since China’s trade pattern is goods dominant, the result is often that products are exported while pollutants are left over. So China is more affected by negative environmental impacts whereas the positive environmental benefits it brings about to other countries are almost ignored. Trading in coke, textiles, footwear, toys, waste paper and electronic wastes all serve the interests of foreign countries. Take electronic products as an example. China’s import in wastes has been on the rise in recent years. The amount of imported wastes used for raw materials totaled 33.08 million tons in 2004, increasing by 7 folds compared to 4.58 million tons in 1996. Of the imports waste paper, steel scraps, waste hardware and electric appliances as well as waste plastics account for larger proportions, making up 36%, 28%, 15% and 12% respectively in 2004. Massive import of solid wastes by China not only eases the pressure of environmental pollution of export countries and their waste disposal cost, but also generates considerable economic and environmental benefits to China through processing and reuse of wastes as raw materials. Because it may have less impact on environment to import and reuse wastes than to explore natural resources for refining. For example, we can reduce environmental pollution from mining activities and smelting waste residues through importing waste scraps, which also helps save energy and improve productivity. The environmental impacts brought about by China’s development resulted from changes in the division of labor in the process of international industrialization. China is the major place of resources consumption and pollution as well as the main victim in current international economic and trade pattern.

3.7.4 China itself is Bearing Environmental Impacts by Other Countries.

In the context of economic globalization, China itself is also bearing environmental impacts by other countries. The main investment by the western countries, which act as the major economic partners, has been in the sector with intensive labor and environmental, resources and energy implication in more than two decades, that is, the major pollution industry has been shifted from the western countries to China. For example, the iron and steel, construction materials, cement, those sectors have been transferred from Europe, USA, and Japan into China. It took more than 20 years for China to have become the global manufacturing base, particularly the heavy chemical industrial base. The shift of industry, is also the shift of global pollutants. And the major environmental impact is that the environmental pressure for the western countries has been less, but that for China, it is bigger. Furthermore, China has exported the manufactured goods into other countries and left the pollutants in China. At the same time, certain pollutants have flown into China as so-called resources. For example, large volume of e-wastes is flooding into China from the developed countries. Among them, some are imported legally, but most of them illegally, in violation of the Basel Convention.

3.7.5. Market Failure at Global Level

Neither positive and negative external environmental impact caused by China nor environmental impact on China by the foreign countries is internalized. Other countries also have similar problems. The fundamental problem lies in market failure in global level. Therefore, to enhance global environment governance and overcome global market failure is the ultimate solution to the above issues. No country can solve these problems by itself.

3.7.6. Too much stress on the environmental externality will limit China’s rights to development

Stressing the negative environmental externality for China, it will limit China’s right to development. As provided in the first clause of the first article of the Declaration of Right to Development, right to development is “an undeprivable human right, and thanks to this right, each person and all the people of the countries have the right to participate, promote and enjoy the economic, social, cultural development and under this development, all the human rights and basic freedom can be fully realised”. Peace, development and human rights are the base for the collective security and the human welfare, and the three are mutually supportive and cannot be separated. The security without development is empty talk, the human rights without development is a mirage, a castle in the air. The right to development is the cornerstone to promote the realizing the economic social and cultural rights well as the civil and political rights. However, 20 years after the adoption of the Declaration on the Rights to Development in 1986, development is still a dream out of reach for many developing countries. Globalization has not benefited all the world, and the rich becomes richer, and poor poorer. The trade barriers in the developed countries, and agricultural subsidies etc. have put the developing countries in a more and more unprivileged position.

3.7.7. China is Willing to Enhance International Cooperation to Solve External Environmental Problems as A Responsible Country.

In a word, ‘China Environmental Threat’ is founded groundless and lacks support by international laws. The external environmental impact caused by China’s economic boom does not violate WTO laws as viewed from international laws. From the perspective of China’s engagement in international environmental agreements and its fulfillment of obligations, China always maintains responsible and positive attitudes. Compared with the economic benefits China has brought about for other countries through its development, stress on global resource and environment by China is exaggerated unfairly while the environmental benefits China has contributed to global environment are totally neglected. China should not be viewed as destroying world environment, but making positive contributions to world environment and development. Given the economic and environmental benefits it generated to foreign countries, its environmental impact is largely exaggerated. Specifically, ‘China Environmental Threat’ is moral judgment out of double standards rather than based on the foundation of international laws. Currently, there are many legal grey areas in international laws, which call for global environmental cooperation to improve international environmental legal system. As a big and responsible country, China needs to enhance international cooperation in the field of environmental protection, and engage in the building up of global environment governance system so as to minimize its external negative environmental impact. For ensuring China’s peaceful development, China needs to strength its soft power in the field of environment.

3.8 The Pollutants Discharge in the Baseline Scenario Of Trend Extrapolation

We have illustrated the discharge of 5 pollutants in the future, by applying the DRC-CGE model, based on the scenario baseline analysis and the changes in the technologies of the pollution discharge. It can be seen from the figure that against 2005, the volume of SO2, dust and soot, CO2 discharge rise respectively by 15%, 1%, 33% by 2010, while the COD discharge volume will reduce by 12%. It can also be predicted that against 2005, the volume of SO2, dust and soot, CO2 discharge, COD discharge rise respectively by 70%, 33%, 107% and 34% by 2020.

In the baseline scenario, the SO2 is expected to increase by 15% during the 11th Five-year Planning Period, i.e. by 3,882,000 tons. For all the factors affecting the SO2, economic increase is the number one leading to the increase in the SO2 discharge and also the most important one. Based on our analysis, during the 11th Five-year Planning Period, the economy will maintain high level of growth, at an annual rate of 9.1%. Such a high economic increase will, to a certain extent, lead to a rapid increase of the SO2 discharge. The data shown in the figure 5 shows that, while all the other factors remain unchanged, the expansion of the economic scale will lead to the increase of SO2 discharge by 14.53 million tons, 50% more than that of the 2005, two times of the actual emission.

4. Scenario Analysis: resource-efficient, environmental friendly, and social harmonious sustainable development

4.1 The 11th Five-year Plan is the strategic step for arresting the environmental deteriorating trend

The possible challenges to the resources and environment forecasted from the trend extrapolation based on the history and status quo will never be tolerated, and it is also a huge challenge to the peaceful development for China. The above-mentioned resources and environmental crisis can never be allowed to occur. Otherwise, it will bring disasters to the future generations and also affect the environment and human development globalwise.

We have to choose the other path of environment and development, and have to resolutely control and improve the resources and environmental state while maintaining the economic increase. The 11th Five-year Planning as approved by the National People’s Congress in March of this year, is the right development plan for the next five years, aiming at change the present resource and environment situation, and it was formulated in line with the scientific development concept.

The 11th Five-year Planning noted it should promote the economic development in a coordinating, sustained and healthy manner and enhance the overall social progress. It should be led by the concept of scientific development to integrate the economic and social development, stick to the idea of putting people first, change the development mindset, make innovations on the current development mode and improve the development quality, and implement the “5 integrations”, so as to bring the economic and social development into the track of comprehensive and coordinating sustainable development.

As requested by the general request for building the Xiaokang society in an overall manner, the 11th Five-year Planning requests that the following major economic and soci