Despite reports that some provinces were dropping out of the
green accounting project to protect their own interests the
official told that the 2005 report would "actually expand to cover
31 provinces and municipalities," displaying "a great leap forward
for the concept of Green GDP."
Officially called the Environmentally-Adjusted GDP Accounting
Report the Green GDP document is intended to drive home to the
public and officials the waste created and environmental damage
done related to economic growth.
Simply, the Green GDP is calculated by deducting the cost of
natural resource depletion and environmental degradation from
traditional GDP. The report for 2005 will be released next month,
said Pan Yue, vice-minister of the State Environmental Protection
The first report, for 2004, was published in September last
year. Officials told that the Green GDP report is a complex
accounting project which takes around two years longer than the
compilation of conventional GDP figures for a fiscal year.
The 2004 report showed that the financial loss caused by
environmental pollution totaled as much as 511.8 billion yuan
(US$64 billion), 3.05 percent of the nation's economy, based on the
traditional GDP accounting method.
The new report will include two more indices to make the
evaluation of environmental losses more accurate, Pan said. One
will compute the cost of transportation pollution and the other the
cost of cleaning-up pollution.
The scheme was launched in March 2004 by SEPA and the National
Bureau of Statistics. In the last two years an accounting analysis
has been made of physical quantification of environmental
pollution, imputed treatment cost and the environmental degradation
cost for 42 industries.
Pilot projects were launched in the three municipalities of
Beijing, Tianjin and Chongqing and the seven provinces of Hebei, Liaoning, Anhui, Zhejiang, Sichuan, Guangdong and Hainan.
Pan admitted that initially SEPA did meet with many difficulties
ranging from technical issues to resistance from regional and
industrial officials. But much to his relief SEPA had managed to
work with the 10 regional governments to work things through, Pan
The general environmental situation remained bleak as a result
of what Pan called catering to immediate interests and reckless
Last year China flunked its target of cutting major pollutants
by 2 percent. Instead there was a growth of 2 percent.
And SEPA officials explained that the retirement last year of
two vice-ministers senior to Pan, Zhu Guangyao and Wang Yuqing,
didn't mean Pan had been promoted. SEPA doesn't have the position
of a "first vice-minister" as some Chinese-language press had
reported, they said.
'Pollute, then treat' isn't an appropriate
Editor's Note: Pan Yue, vice-minister of SEPA, has been in the
media spotlight for the so-called environmental protection "storm"
his administration launched in 2005 to curb the country's
Pan, a strong advocate of Green GDP, has been pushing hard for
the program amid resistance from some local government leaders.
They fear more rigid environmental protection measures will hinder
local economic growth. Pan, in an interview, explains the ambitions
of his administration and himself -- to build a clean, green
Q: It's believed that China could not avoid the practice
of "polluting first, then treating it" as experienced by some
developed countries. What's your comment on this?
A: It might be true that some of these countries could first
develop their economy and then begin to engage in environment
protection. But China really cannot afford such a model.
Firstly, when China started its industrialization and
modernization drive in the late 20th century, the developed Western
countries had already completed their primitive capital
accumulation and established a series of international rules in
their favor. Under such circumstances, it's impossible for China to
transfer its cost of pollution to the rest of the world.
Secondly, the population-environment structure in China is
different, so we cannot blindly copy the Western model to pay
attention to environment issues only after the country has achieved
a per capita GDP of US$8,000. China may already be facing a severe
environment situation when its per capita GDP reaches US$2,000.
Economic crisis can be resolved through macro-control but an
ecological crisis will inevitably lead a country to disaster.
Thirdly, China has taken the road of socialism and the
traditional Chinese culture is a culture of harmony. That means
China will never practice any form of eco-colonialism. The only
correct path for us is to pursue sustainable development, namely a
path of peaceful and environment-friendly development.
Q: Did the SEPA seek international experience and
cooperation in China's Green GDP calculation?
A: In China's Green GDP calculation, we've tried to ensure
consistency in concepts, definitions and classifications of its
indicators with the System for Integrated Environmental and
Economic Accounting which is promoted by the UN Statistics
Division. At the same time we've worked closely with the
The World Bank set up a special technical support program to
help research the Green GDP accounting which was concluded last
month. We also received encouragement and support during our work
from the UN Statistics Division, the United Nations Environment
Programme, the European Union, Canada, Norway and the
Q: The SEPA last Thursday named 82 projects with a total
investment of 112.3 billion yuan (US$14.44 billion) that failed to
pass environment appraisal and suspended appraisals for all the new
projects in four cities and for four of the country's major power
groups. The media described the move as another "environmental
protection storm." What do you think?
A: No matter what it's labeled my judgment criteria is that: if
each time we can solve new problems and help set up new systems
then it's of significance. If it can't solve a problem or establish
a system merely to serve the whims of the media then it's
meaningless and will be soon forgotten.
Two years ago the SEPA issued an interim regulation on public
participation in environment appraisal. A regulation on environment
appraisal was also submitted to the Office of Legislative Affairs
of the State Council.
These regulations, together with our ongoing move to stop
environment appraisal of a whole region for a single violation and
a regulation under discussion to open environment information to
the public are all part of our constant efforts to create a new and
better mechanism and system.
Q: By calling a halt to projects that violate
environment appraisal rules the SEPA has substantially affected the
economic interests of local governments. How will you overcome
A: At present, driven by local and industrial interests, the
situation of illegal construction and operation is getting worse.
It has severely disrupted the country's macro-control and
industrial structure and put mounting pressure on the environment
The mild environment management and legal measures we once used
in the past have proved to be ineffective. Therefore, we have to
explore new ways of management.
The policy to stop environment appraisal of a whole region or
whole industrial group for a single violation is a major innovative
way of enhancing the administrative powers of the environmental
Q: The SEPA has constantly promoted the inclusion of
environmental protection achievements in the official performance
evaluation system. Do you think it can effectively prod local
officials to pay more attention to environmental
A: The move is very necessary. But a scientific objective and
appraisal system should be set up first. Like the Green GDP
calculation system a strict rewards and punishment system and
accountability should be adopted to ensure governments at all
levels will implement it.
We'll do what we can to speed up the legislative process of a
detailed regulation to evaluate the environmental protection
performance of officials and make it an important reference for
their promotion or appointment. Only by doing this can we change
the officials' "economy-overriding-all" perspective and to one of
low energy consumption, high utilization and low emission.
Q: Are you confident that the country will meet its
pollution control target?
A: The central government has made it compulsory to cut
discharge of major pollutants by 10 percent for the country's
economic and social development in the 11th Five-Year Plan period. The solemn
commitment indicates the central authorities had considered
environmental protection strategically important to the country's
long-term growth and to the interests of the people.
The SEPA has signed responsibility contracts with provincial
governments and six state power groups, including the China Huaneng
Group, to reduce the discharge of pollutants. The SEPA has also
released guidelines on the allowance quotas of wastewater discharge
and sulphur dioxide emissions.
Q: Some media reports claim you've been promoted the
first vice-minister of the SEPA. Is it true?
A: I'm now a vice-minister because two SEPA vice-ministers have
just retired so you can't say I was promoted. However, promoted or
not, it doesn't matter so long as I can work for the country and
(China Daily January 18, 2007)