China Wakes Up to Its Environmental Catastrophe

By Elizabeth Economy 

March 13, 2014 

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At its worst, the “airpocalypse” that settled over Beijing and northern China in late February had a fine particulate matter reading 16 times the recommended upper limit, turning Beijing into a veritable smoking lounge. Satellite images, a click away on the Internet, showed a massive toxic haze. Farther south, cadmium-tainted rice has been a staple of Guangzhou’s food supply since at least 2009. The dead pigs that floated down Shanghai’s Huangpu River last year were grotesque enough to haunt citizens even in their sleep.

With such scenes as a backdrop, Premier Li Keqiang suitably declared a “war on pollution” at the National People’s Congress (NPC) in early March and outlined an array of targets, policies, and campaigns to address the environmental ills. His pronouncements are just the latest attempt to stay ahead of an issue that could be a grave threat to the leadership’s credibility.

China’s new leaders, including President Xi Jinping, haven’t embraced environmental protection by choice. They’ve been compelled by a new political reality: an informed Chinese public. Throughout 2011 and 2012, American Embassy officials in Beijing measured and tweeted the true levels of hazardous pollutants in the capital. (Twitter (TWTR) is banned in China, but information boomerangs to Sina Weibo, the country’s dominant microblogging platform, and spreads there just as fast.) Soon, the Chinese were demanding that their own government provide similar data. Beijing complied in 2012, and popular pressure to address the scourge of air pollution grew, even as Li sought to tamp down expectations of a quick solution. “There has been a long-term buildup to the problem,” he said in January 2013, “and the resolution will require a long-term process.”

Over the course of the new leadership’s first year in office, however, playing for time has become unfeasible. A July 2013 study found that air pollution in China’s north reduces life expectancy by an average of five and a half years. Water pollution has been linked to increased rates of cancer in almost 500 villages along China’s highly polluted rivers. An analysis by research firm Beijing Zhonglin Assets Appraisal estimates that Beijing’s traffic congestion costs the city about $10 billion a year in lost economic activity and $7 billion in environmental damage. The capital’s tourism industry has also been hit hard by the life-threatening smog, with the number of visitors to Beijing dropping 10 percent in 2013. Overall, environmental degradation and pollution are estimated by the Chinese Academy of Environmental Planning to cost the $9.3 trillion economy the equivalent of 3.5 percent of gross domestic product annually.

Almost two-thirds of the country’s wealthy, citing China’s pollution, have left or plan to leave

Most important, the Chinese people are voting with their feet. Almost two-thirds of the country’s wealthy—those with assets of $1.6 million or more—have left or plan to leave the country, with the environment one of their most frequently cited reasons, according to the Hurun Report, a Shanghai-based wealth research firm. Those who can’t leave are taking to the streets: The environment has surpassed land expropriation as the leading inspiration for the more than 180,000 popular protests each year.

Much of what the leadership has proposed thus far (targets to limit energy consumption, sulfur dioxide emissions, and chemical oxygen demand, a measure of water quality) is simply a continuation of previous environmental efforts. Even a policy to hold local officials responsible for how well they protect the environment—promoted by the Chinese leaders as a new initiative—has been around for decades but never effectively enforced. Sweeping campaigns such as the one Li announced at the NPC to shut down 50,000 small coal-fired furnaces and remove 6 million high-polluting cars and trucks from Chinese roads sound good, but they’ve traditionally fallen well short of their targets. And a policy to relocate China’s most polluting industries to the western provinces neither serves the country’s long-term environmental interests nor advances stability in a politically fraught region.

What are needed are not bold promises but bold structural reforms. Better coordination among the multitude of government agencies and other actors with a stake in environmental policy is at the top of the list. While Beijing has been busy establishing commissions on economic reform, domestic security, and cybersecurity, it desperately needs to restore the State Environmental Protection Commission—an oversight body eliminated during a government reorganization in 1998. Such a powerful supraministerial commission, which would have the power to convene ministries and push for the resolution of environmental problems, is essential to resolving ongoing interagency battles on issues ranging from pollution fees to resource management.

Funding for environmental protection has hovered at 1.3 percent of GDP for well over a decade, although Chinese environmental experts have called for an increase to 2.2 percent merely to keep the situation from deteriorating. The leadership recently pledged allocations of billions of new dollars to the environment, for example promising a $1.6 billion fund to reward cities that meet air-quality goals. During their first year in office, however, Xi and Li actually presided over a 9.7 percent decline in environmental spending—largely because subsidies for energy-efficient products ended—and spent only 86 percent of the funds available for environmental protection. As the pair continue to announce policies and programs, they must ensure that the financial support exists to implement them.

Xi has hinted at the potential for judicial reforms, which will be crucial given that corruption pervades the environmental protection system, from monitoring to enforcement. According to a former head of a local environmental protection bureau in Jiangsu province who was not authorized to speak on the record, an entire industry involving local governments, assessment agencies, and project developers has grown up around the falsification of environmental impact assessments (EIAs). In November 2013 an oil pipeline burst in Qingdao, killing or injuring more than 100 people; a faulty EIA process was partly to blame for the deaths. As Chinese environmental journalist Liu Jianqiang commented in reference to the Qingdao disaster, “It is common in China for EIAs to be faked and planning assessments to simply not exist—and so our country is littered with such ticking time bombs.” Equally disconcerting, about half of the money allocated by Beijing to local officials for environmental protection is spent on other priorities. Addressing these issues of corruption and official malfeasance will require a legal system capable of holding local officials and businesspeople accountable.

Transparency is the first emerging bright spot in China’s environmental protection effort. A daily review of local air quality has now become a citizen’s right, and a new policy to bring about real-time reporting of the emissions from 15,000 Chinese factories, slated to begin last January, will be another important step. In some cases, local governments have even started acting on their own. Despite Beijing’s refusal to publish the results of a national soil contamination survey, land and resource officials in Guangdong province provided a report on soil pollution in the Pearl River delta region to the local people’s congress. The results showed that 28 percent of the land in the area—including 50 percent in the cities of Guangzhou and Foshan—has excessive levels of heavy metals.

Chinese experts want to ensure that when policies are advanced, they’re rooted in a sound understanding of the problem. As Peking University professor Xie Shaodong has noted, it’s questionable whether China makes the “relevant assessments” of its environmental policies in the same way that foreign governments do. Particularly when large-scale campaigns are launched, good policy can be ignored. In the push to clean up the air in Hebei province, a local township recently shuttered scores of cement factories. Not only did the air quality not appear to improve, but thousands of workers are also now without jobs.

President Xi and Premier Li must contend with one of the greatest, if unplanned, legacies of the Hu Jintao and Wen Jiabao era: the environmental awakening of the Chinese people. With their rafts of policy pronouncements, Xi and Li signal that they recognize the changed political landscape. The question before them now is whether they’re prepared to meet the Chinese demand not simply for bold promises of change but also for change itself. 

Economy, director of Asia studies at the Council on Foreign Relations, co-authored By All Means Necessary (Oxford, 2014).