Engaging China with the Environment

by Ted Franklin

September 2007



Containing Chinese instability in the global market will require creative solutions that exploit weaknesses within the nation’s economic framework. One such weakness is the failure of the Chinese government to ensure environmental standards for the nation’s rapid growth. It is true that the government has made steps to curb environmental degradation by upgrading the State Environmental Protection Agency (SEPA) into a cabinet level ministry and placing environmental guidelines on new development. However, the Chinese embassy cites 50 ‘official? environmental accidents from 1997-2003 with only 20 people held accountable. Such figures represent the discrepancy in China between the ‘official?standard and real authority to implement change.

Herein lies the dilemma throughout Chinese development. From empty skyscrapers to false “made in China?labels to environmental standards that merely appear on paper, Chinese growth is geared for speed and not quality. Such growth is catching up with the authoritarian government. Ma Jun, from the Institute of Public and Environmental Affairs, a Chinese NGO focusing on water pollution, reports a 29% yearly increase in pollution-related protests. This summer, Beijing pressured the World Bank to remove one-third of a report entitled “The Cost of Pollution in China?due to concerns that it might be “too sensitive?and cause “social unrest? The report estimated that 750,000 die prematurely in China, largely from air pollution in cities.

The Netherlands Environmental Assessment Agency reported in June of 2007 that according to data collected by BP, China has become the leading emitter of CO2, surpassing the United States by 8%. One WHO report puts 7 of the 10 most polluted cities in the world in China, which epitomizes the environmental problem but is by no means its lone example. The Three Gorges Dam, set to be the world’s largest hydro-electric dam has met a range of criticisms linked to ecological problems such as landslides and erosion but also social concerns as more than 1 million people have already been displaced. Each week two new 600-megawatt coal-fired plants are brought online. In the summer of 2006, New York Times reported a sulfuric cloud that scientists tracked from northern China, across the Pacific Ocean, to filters at Lake Tahoe in California.

Therefore, as western nations approach China and wish to use the environment at the negotiation table, they have the advantage that pollution and other environmental crises are not only destabilizing China domestically but also have global repercussions. With these weaknesses in mind, pressure can be placed internally and externally on the Chinese government.

The internal problem of Chinese environmental policy relates to human rights. The heavy use of pesticides is resulting in high rates of birth defects and polluting watersheds. According to Beijing officials, 70% of lakes and rivers were polluted and over 300 million rural Chinese lacked safe drinking water in 2005. As already mentioned, air pollution kills more than 400,000 people each year. Coupled with such poor health conditions, the WHO has ranked China’s healthcare system at 187th out of 191 countries. These are only some of the issues that cause the Chinese government to fear “social unrest? As the looming threat of an unstable China becomes clearer, policy makers should push such issues as a strategy for containment.

As governments continue to realize the scope of global warming, fear of such a crisis throughout the world will provide both a problem and an opportunity. In the long term, governments will be forced to provide solutions to calm fears, but in the present, they can use the fear of global warming to place external pressure on developing nations.

Fear of an environmental crisis such as global warming provides a global platform for an alliance against China. It is a common denominator across a range of societies and for this reason might provide the consensus needed in western democracies to place pressure on China. If governments make positive connections between the coming environmental crisis and the 6.2 billion tons of carbon China emits, pressure from the western public will follow.

There is a second benefit to pressuring China via the environment. Businesses are increasingly finding consumers interested in environment friendly products. There is big business in protecting the environment, not only at home but also in China who has recently placed orders for wind turbines to be installed along the coast. Also, China has consistently promised to seek cleaner coal technologies and has plans for installing at least two nuclear plants each year. Germany is benefiting from the new boom in environmental technology with exports in that sector reaching 6bn euros in 2006, an increase of 30% from 2005.

Of course, the initial reaction of many to such statements would be to point out the failures of the United States and the west at protecting the environment. While it is a valid statement that the United States and the west deserve criticism for their environmental policies, they are doing something about it. Be it in clean coal initiatives or subsidies for alternative fuels, the last few years have seen a growing surge of “green technology? often supported at the governmental level. This trend is evident in the markets as green industry and technology are surging from investment. The United States has been very careful in this regard due to a continued dependence on foreign oil and not wishing to compromise or endanger those contracts. For the sake of containing China, the current quantity or quality of US involvement in potentially compromising environmental technology is much less important. What is needed is a convincing set of policies that satisfy the public that the US is trying to avert environmental disaster to a greater extent than China.

The world has failed to realize the opportunity afforded by the environment and consistently granted concessions to China. A controversial UN program, the Clean Development Mechanism, takes funds from developed nations through a complex market of pollution credits and gives the money to the developing world to create projects aimed at limiting emissions. China receives three quarters of those funds despite having over $1 trillion in foreign exchange reserves. As mentioned earlier, the World Bank bowed to Chinese pressure and omitted a section of the Cost of Pollution in China. By not publishing their complete findings, the World Bank is complicit to the injustice described in their report. The world allowed China exemption under the Kyoto Protocol. Secretary of the Treasury, Henry Paulson, failed at talks in 2006 to make any strong stance on the currency issue. There is a trend of concession to the Chinese ruling elites, which is harmful for the entire world, including the unrepresented Chinese populace.

Perhaps the most egregious offense on the part of the west, is allowing China to become the dominant player in Africa, particularly in the eastern and southern regions. Their actions in Sudan typify their presence on the continent. China provides the infrastructure required to exploit the vast oil reserves in Sudan and extracts the oil. In return, China provides the al-Bashir government military aircraft, vehicles, and small arms that are then used in human rights abuses in Darfur and the oil-rich south. Coupled with this complicity in such crimes, the Chinese encourage environmental destruction while prospecting for oil with scorched earth campaigns that ultimately displace the local populations. This scenario is played out with a wide range of resources across the continent: from wood to metals. China’s presence in Africa is an example of how the west needs to use the environment. The media has decried China’s role in Sudan and caused mounting pressure for the Chinese to pust the Sudanese government to work to end the Darfur conflict. Pressuring China means tying its economic growth to global environmental degradation and human rights abuses. It should resonate with self-interested western citizens that China’s growth has profound effects throughout the world and not only inside the Middle Kingdom.

This past month, China indicated for the first time that it might initiate their “nuclear? option if the United States were to impose sanctions on Chinese goods. China holds $900bn in mixed US bonds and has hinted it might liquidate those funds, an action that would trigger a dollar collapse. This paper by no means seeks to propose the environment as the sole ‘weapon?or weakness in the Chinese system to counter such a threat. Yet, the ecological shortfalls of China’s growth have broad implications for the world that could potentially be used to build consensus for an alliance. This is particularly the case as the global environmental crisis becomes clearer. Therefore, the environment is only one facet of a multi-prong approach to pressure the authoritarian regime to liberalize socially, increase quality standards at the expense of growth, and allow the Yuan to adjust to a market-determined exchange rate.





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