Future of China in 2030

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Group Members

Guy Keidar
Gerrit Ledderhof
Chia Wei Lee
Johanna Little
Geoff Spielman

Introduction

This page is the main source for the scenario set Future of China in 2030.

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Research Questions

Government and Politics

Economics

Society and Culture

Environment

Short answers about the different questions...for more details, go to Key Environmental Drivers - China in 2030

What are the key drivers behind China's current environmental state?
The driving factors behind China’s environmental problems include an increase in the number of households, increased urbanization, explosive economic growth, failure to execute environmental policy, lack of public awareness and prioritization of economic growth over sustainability. The number of households in China has grown almost three times as fast as its population during 1985-2000. The average household has decreased from 4.5 to 3.5 people and because smaller households consume more resources per person, China’s rapid increase in household number and reduction in household size have had significant environmental consequences. China is also becoming more urban. From 1952 to 2003, the country's proportionate urban population tripled from 13% to 39%. (Liu & Diamond, 2005)

Another driving force behind China's current environmental situation is due to its economic growth. China is a large consumer of fertilizer and pesticides. The consumption of these industrial and agricultural products leads to air, water and land pollution and other forms of environmental damage. With increasing affluence, China’s per capita consumption of meat, milk and eggs increased four-, four- and eightfold, respectively, between 1978 and 2002. This means more agricultural wastes, animal droppings, fish droppings, fish food and fertilizer for aquaculture, tending to increase terrestrial and aquatic pollution. Additionally, China’s transportation network and number of vehicles have grown explosively. In 1994, after the number of motor vehicles had increased to six times the 1980 figure, China decided to make car production one of its four ‘pillar industries’ to stimulate economic growth, with the goal of increasing production (especially of cars) by another factor of four by 2010. This would make China the world’s third-largest vehicle manufacturer, after the United States and Japan — with obvious implications for highway expansion at the expense of arable land, greater dependence on imported oil, and the recently improved but still poor air quality in cities such as Beijing. Further, much of China’s economy — such as coal-mining and cement, paper and chemical production — still rests on outdated, inefficient or polluting technology, and overall industrial energy efficiency is only half that of the developed world. Coal is the country’s primary energy source and the main cause of its air pollution and acid rain. Although solar and wind power are potentially significant renewable energy sources, hydroelectricity will become more important over the next decade, particularly with the expected completion of the controversial 18.2-gigawatt Three Gorges Dam project in 2009. China is hosting the world’s three biggest development projects, all of which are expected to cause severe environmental problems. The Three Gorges Dam on the Yangtze River — the world’s largest dam, begun in 1993 and projected for completion in 2009 —aims to provide electricity, flood control and improved navigation at a cost of $30 billion, social costs of uprooting millions of people, and environmental costs associated with landslides, water pollution, soil erosion, biodiversity losses and the disruption of the ecosystem of the world’s third-longest river. Still more expensive is the South-to-North Water Diversion Project, which began in 2002 but is not scheduled for completion until around 2050. It is projected to cost $59 billion, to spread pollution, and to cause water imbalance in the Yangtze. Even that project will be exceeded by the ongoing development of western China, comprising over half of the country’s land area and viewed by China’s leaders as the key to national development.(Liu & Diamond, 2005)

Although China has made strides in writing environmental protection policy, the country still lags in execution of these policies. China declared environmental protection a basic national principle in 1983, laid out a broad strategy to achieve sustainable development in 1994, and in 1996 developed its first five-year plan on environmental protection. In 2003, the government proposed a new development concept emphasizing humanism and attempting to achieve sustainable development and harmony between man and nature, as well as coordinated socioeconomic progress among various regions and with foreign countries. In reality, although there has been much effort to control environmental degradation, economic development often takes priority at the local level and is still the main criterion for judging government officials’ performance. (Liu & Diamond, 2005) In 2006, premier Wen Jiabao listed three changes that China needs: to move from a GDP-centered model of growth to one that balances economy and environment and seeks the development of environmental protection; to change from a view of environmental protection as an obstacle to economic growth to the development of economy and environment in tandem; and to institute a range of methods to help resolve environmental problems. (Jun, 2007)

Public environmental awareness is low, in part because China’s investment in education is less than half that of developed countries as a proportion of gross national production. Despite holding 20% of the world’s population, China’s educational funding accounts for only 1% of world investment. Most parents cannot afford to send their children to university, because one year’s tuition would consume the average salary of one city worker or three rural workers. When there are conflicts between environmental protection and economic development, the former often loses to the latter. Economic performance often overshadows environmental protection as a criterion for selection and promotion of government officials.


What impact have these key drivers had on the environment?

The impact that China’s environmental degradation has on its people can be broken up into three categories: socioeconomic losses, health costs, and the effects of more frequent and damaging natural disasters.

Socioeconomic losses: The losses from pollution and ecological damage ranged from 7% to 20% of GDP every year in the past two decades. Besides heavy economic losses, pollution and resource competition have triggered numerous social clashes in China, including 18 conflicts over forest resource management in southwestern China. Similarly, water shortages in the Yellow River have triggered ‘water wars’ between people on the river’s upper and lower reaches, between people on opposite sides of the river, and between backers of industrial, agricultural and ecological needs.

Health Costs: Environmental pollution imposes further costs through its impact on human health. From 1996 to 2001, China’s spending on public health increased by 80%, or more than 13% per year (from $35 billion in 1996 to $63 billion in 2001), in part to cope with environmental problems. About 300,000 deaths per year are attributed to air pollution. Average blood lead levels in Chinese city dwellers are nearly double those considered to be dangerously high and to endanger childrens’ mental development. The risk of respiratory disease increases with the outdoor concentration of total suspended particles. Even short-term exposure to air pollution can result in low infant weight and increased morbidity and mortality.


Natural Disasters: China is noted for the frequency, number, extent and impact of its natural disasters. Human actions have made some of these more frequent, especially dust storms, landslides, droughts and floods. Overgrazing, erosion, grassland degradation, desertification and partly human-caused droughts have led to more frequent, and more severe, dust storms. From AD 300 to 1949, dust storms struck northwestern China on average once every 31 years; since 1990 there has been one almost every year. The huge dust storm of 5 May 1993 killed a hundred people. Recent increases in droughts are believed to be due to deforestation that has interrupted the water cycle, and perhaps also due to the decrease in surface water resulting from draining and overuse of lakes and wetlands. Droughts damage about 160,000 km2 of cropland each year, double the area damaged in the 1950s. Flooding has greatly increased because of deforestation; the 1996 and 1998 floods were the worst in recent memory. Alternating droughts and floods have become more frequent and are more damaging than either disaster alone, because droughts destroy vegetation, and then flooding of bare ground produces worse erosion.


What are China's most significant environmental obstacles going forward?

China's largest obstacles to improve the environment lie in the failure to execute environmental policies, prioritizing economic growth over environmental protection, a lack of public awareness, and its continued economic growth. China has developed numerous environmental laws and policies, but most of them are just on paper. Chinese environmental laws and regulations were written largely piecemeal, lack effective implementation and evaluation of long-term consequences, and need a systems approach. Environmental protection agencies lack sufficient authority, financial resources and manpower. Environmental awareness is also low among the general public, government officials and business people. Most people think that environmental protection harms economic growth and do not recognize that environmental problems have already caused huge economic losses, severe social conflicts, enormous health costs and increased "natural" disasters (such as dust storms, floods, droughts). Furthermore, many technologies in China are outdated, inefficient and highly polluting. Finally, China's continued economic growth and changing lifestyles will continue to be a large obstacle in improving the environment. Although per capita consumption in China is still much less than that in developed countries, increases in consumption are accelerating. Diet is shifting more toward meat and away from grain. More cars are pouring into newly constructed and rapidly expanding highways. Divorce has become increasingly common, resulting in more and smaller households and thus lower efficiency of resource use. In 2004 alone, over 1.6 million couples split up. (PBS, 2006)

How will the state of China's environment affect the country's future?

If economic growth, rather than environmental protection or sustainability, continues to be a priority for China then the future looks bleak. Despite a fall in population growth rate, the number of Chinese is projected to reach almost 1.5 billion by 2030. The projected drop in household size to 2.2 people by the year 2030 alone would add over 250 million new households — more than the total in the entire Western Hemisphere in 2000 — even if China’s population size remained constant. These additional households will add to the inefficient use of energy and continue degradation of the environment.

The Chinese environment also faces many specific dangers. The number of cars is rising, and croplands and natural wetlands are disappearing. The harmful consequences of this will accumulate. With rising affluence, and hence meat and fish consumption, environmental problems from meat production and aquaculture, such as pollution from animal and fish droppings and eutrophication from uneaten fish food, will increase.

Potentially more important than all of these other impacts is a further consequence of China’s having the world’s largest population and fastest-growing economy. Total production or consumption is the product of population size times per capita production or consumption rate. China’s total production and consumption are already high, because of its huge population, despite its per capita rates still being very low. But China is rapidly becoming a developed-world economy. If China’s per capita consumption rates do reach such levels, and even if populations, production and consumption rates everywhere else remained unchanged, those rate increases alone would translate into a 94% increase in total world production or consumption in industrial metals, and a 106% increase in the case of oil. In other words, China’s achievement of developed-world consumption standards will approximately double the world’s human resource use and environmental impact. But it is doubtful whether even the current human resource use and impact on the world can be sustained. Something has to give, or change. This is why China’s environmental problems are the world’s.

What will China's environmental policy be going forward?

Recognizing the environmental challenges the country faces, the Chinese government is hoping to build an environmentally-friendly society, and has set very ambitious environmental goals. By 2010, China aims to basically control the trend of environmental deterioration, improve environmental quality in some key regions and key cities, reduce the total emission of major pollutants by 10 percent, lower energy consumption per unit GDP output by 20 percent from the 2005 level, maintain cropland and increase forest cover from 18 percent to 20 percent. By 2020, China plans to significantly improve environmental quality and ecological conditions. Still, China's economic goal is to double its GDP by 2020, and we've seen from the past two decades that economic goals tend to be well surpassed while environmental goals are left largely unattended to. (PBS, 2006)

China is increasingly assuming responsibilities on the world stage by participating in environmental treaties. Many environmental laws, policies and regulations are being developed or improved. The Chinese public’s environmental awareness is rising. China has been pushing hard for cleaner production and sustainable development. Some environmental and product standards have reached developed-world levels. Energy intensity is declining. Technologies for production and for treating environmental waste are improving. To reduce air pollution in Beijing, the city government ordered that vehicles be converted to allow the use of natural gas and liquefied petroleum gas. China has phased out leaded petrol in little more than a year, something that took Europe and America many years to achieve. New cars must meet the exacting emissions standards prevailing in Europe. Since 1990, China has combated desertification on 24,000 km2 of land by reforestation and fixation of sand dunes. The Grain-to-Green program, begun in 2000, gives grain and cash subsidies to farmers who convert cropland to forest or grassland, and is reducing the use of environmentally sensitive steep hillsides for agriculture. By the end of 2003, 79,000 km2 of cropland had been returned to forest or grassland. By the end of this program in 2010, approximately 130,000 km2 of cropland are expected to be converted, making it one of the largest conservation programs in the world. China is also designing and adopting a green accounting system that includes environmental costs in the calculation of gross domestic product (or Green GDP).

Driving Forces

New Forces

The following forces were determined by our group:

Desertification of China
Amount of desert in China is increasing by 900 sq miles every year!
Rising costs of labour in China
China is beginning to become less competitive in relation to its regional peers due to rising labour costs, as Chinese workers begin to demand greater wage increases

Existing Forces

The following forces are already existing on the wiki that are explicitly related to China.

Political Driving Forces

Economic Driving Forces

Societal Driving Forces

Scenarios

References

News and Journal Articles

  1. Jun, Ma. (2007). How participation can help China's ailing environment. Available: http://www.chinadialogue.net/article/show/single/en/733-How-participation-can-help-China-s-ailing-environment
  2. PBS. (2006). China's Environmental Future. Available: http://www.pbs.org/kqed/chinainside/nature/environment.html.
  3. Liu, J. & Diamond, J.. (2005). China's Place in the World: Environmental Impact of a Giant. Available: http://www.csis.msu.edu/Publication%20files/China_Environment_Globalization.pdf

Previous Scenarios

  1. http://www.weforum.org/pdf/scenarios/China_report.pdf
  2. http://scenariothinking.org/wiki/index.php/Future_of_China_in_2020
  3. http://money.cnn.com/magazines/business2/business2_archive/2006/08/01/8382233/index.htm
  4. http://www3.brookings.edu/views/articles/li200707.pdf

Recommended Reading

  1. Barton, D. 2004. Facing China. The McKinsey Quarterly 2004 special edition: China today.
  2. Bekier, Matthias M., Richard Huang, and Gregory P. Wilson. 2005. How to fix China’s banking system. The McKinsey Quarterly 2005. Number 1.
  3. Bloom, Erik, Vincent de Wit, and Mary Jane Carangal-San Jose. 2005. Potential Economic Impact of an Avian Flu Pandemic on Asia. ERD Policy Brief Series No. 42. Manila : Asian Development Bank. November.
  4. Brahm, Laurence J. 2001. China’s Century: The Awakening of the Next Economic Powerhouse. Singapore: John Wiley & Sons (Asia) Pte Ltd.
  5. Chen, Kun, and Martin Kenney. 2005. University/Research Institute-Industry Linkages in Two Chinese Cities : Commercializing Technological Innovation. To be presented at “Universities as Drivers of the Urban Economies in Asia” sponsored by the World Bank and Social Research Council. 24-25 May.
  6. Courrier International. 2005. La Chine des Chinois. Hors-Série, Juin-Juillet-Août. France.
  7. Crane, Keith, Roger Cliff, Evan Medeiros, James Mulvenon, and William Overholt. 2005. Modernizing China’s Military: Opportunities and Constraints. RAND Corporation.
  8. Economy, Elizabeth C. 2004. The River Runs Black: The environmental challenge to China’s future. Ithaca & London: Cornell University Press.
  9. Hale, David (Hale Advisers, LLC). 2005. China’s Currency Conundrum. Central Banking Volume XVI No.1. London: Central Banking Publications.
  10. Smil, Vaclav. 2004. China’s Past, China’s Future: energy, food, environment. New York, NY and Great Britain : RoutledgeCurzon.
  11. UBS Securities Asia Ltd, UBS Investment Research. 2005. How to Think About China. Asian Economic Perspectives. Hong Kong. 6 January.
  12. Morgan Stanley Equity Research. 2004. New Tigers of Asia. India and China: A Special Economic Analysis. Asia/Pacific, 26 July.
  13. Orr, Gordon R. 2004. The aging of China. The McKinsey Quarterly 2004 special edition: China today.