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February 11, 2010

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China's high cost of prosperity and GDP

CHINA'S first national census of pollution sources has highlighted the glaringly high price the country has paid for its rush to prosperity.

In a report issued Tuesday and hailed by environmentalists as a big step toward greater transparency, China makes no secret of the magnitude of its pollution problem, which turns out to be much worse than previously reported.

Several issues addressed by the report may send chills down people's spines. Notably, the pollution of the country's waterways in 2007 was more than twice as grave as was shown in official figures released at the time.

The surge in pollution figures revealed by the census is caused in part by the expanded scope of the survey and in part by different calculating methods.

For a country that is yet to be freed from the grip of a "GDP cult," this report came as a compelling negation of the decades-old economic growth formula, in which high GDP is valued above almost everything else - whatever the cost to people and the environment.

Zhang Lijun, vice minister for environmental protection, emphasized the link between pollution and industrial growth in some regions, during a press conference on Tuesday.

"Emissions of industrial pollutants vary wildly across regions and industries, with more developed and densely populated localities leading the nation in dumping major pollutants like sulfur dioxide and nitrogen oxide," Zhang said. "It's a structural problem."

More disturbing is the fact that for the very first time agricultural pollution has been taken into account when the census, which took two years to complete, was compiled. And it is found to pose no less a threat than industrial pollution to China's fragile water systems.

For instance, the chemical oxygen demand (COD) - a major gauge of water pollution - required to feed the growth of agriculture totals 13.24 million tons, or 43.7 percent of national chemical oxygen demand, according to the report.

Given so many gloomy facts, the candor with which China owned up to its pollution levels is laudable. But candor alone will not guarantee less pollution in the future, so long as some officials and business people are still left unchecked - and in some cases eagerly encouraged - to ravage the environment for quick development profits.

Those people who fall under the spell of the "GDP cult" and discharge untreated sewage (among other things) into China's rivers simply don't realize or don't care that worsening pollution will eventually take its toll on their profits and worse - stymie their sustainable growth.

Of every 10 yuan (US$1.46) they make from their operations, half the sum or even higher may eventually be lost in the form of belated pollution control costs, according to some research.

This inherently flawed quest for GDP was summed up by Pan Yue, also a vice minister for environmental protection, when he wrote in a 2006 opinion article: "... more realistic estimates put environmental damage at 8-13 percent of China's GDP growth each year, which means that China has lost almost everything it has gained since the late 1970s due to pollution."

At the press conference on Tuesday, vice minister Zhang Lijun said: "China's pollution levels may peak by the time its per capita income reaches US$3,000." China's current capita income stands at around US$2,100 but it is way above US$3,000 in certain coastal areas where industries are clustered.

In contrast with many Western countries, where pollution levels begin to decline after per capita income hits US$8,000, China's "different growth path" - as Zhang put it - may enable it to "scale back pollution at an earlier point." However, he gave no reason for his optimistic, but not unqualified, assessment.

The high price China has paid for its long-overdue environmental protection is ultimately borne by its own people. Numerous villages along the country's prosperous eastern coast have reported a startling surge in cancers and lead poisoning among residents due to chemical plants operating in their vicinity.

The newly released census may well prompt some genuine reflection on the mixed blessings of China's hectic growth - and alarm.

Things are likely to get worse before they get better, and this adage rings true for a country like China where pollution has swollen to epic proportions - but any attempt to combat it is likely to encounter resistance from some local officials who simply cannot define "prosperity" as anything beyond GDP figures.




 

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