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Looking into the Future: Many Challenges Lie Ahead

The 30 years of rapid economic development that China has experienced are equal to 100 years or more of development in Western developed countries. One can well imagine the accumulated problems and confronting challenges. Generally speaking, the challenges fall into three categories.

First, although China's resources and environment have made great contributions to sustaining three decades of rapid economic growth, China will be increasingly confronted with the arduous pressure of energy conservation and reducing resources consumption.

Under conditions of a large population but weak economic strength and technical competence at the beginning of reform and opening-up, when meeting people's basic living needs was the country's most pressing problem, China employed its natural resources to cultivate a modern industrial system and accelerate all-round economic and social development.

It is estimated that during the past 30 years, the mining of mineral resources has directly generated some 10 to 30 percent of China's GDP, as well as contributing substantially to the remaining 70 to 90 percent. Meanwhile, the utilization efficiency of resources has improved, and China has sustained its economic boom with a much lower resources consumption growth than GDP growth. During the period in question, China's GDP increased 11-fold, while water resources consumption grew by only 30 percent, energy consumption increased 3.4-fold and ecological acreage utilization increased two-fold. In 1978 China's energy consumption per RMB 10,000 of GDP was 15.68 tons of standard coal. This figure was 5.06 tons in 2006. In 1980 industrial wastewater emissions per RMB 10,000 of GDP were 1,187.3 tons. This dropped to 70.6 tons in 2006.

Compared with developed countries, however, China still needs to improve further. In the rating of resources performance levels of 59 major countries, China ranks sixth from the bottom. China's energy consumption per RMB 10,000 of GDP is three to 11 times that of developed countries. In terms of strategic resources, China is confronted with severe shortages, particularly of oil and iron ore. China's external oil dependence reached 47 percent in 2006 and iron ore exceeded 50 percent, presenting profound challenges for China's economic security. Accordingly, China must establish a resource-conserving and environmentally-friendly society to relieve the stress brought by resource deficiencies and restricted environmental carrying capacity. Technological advancement and independent innovation should be fully tapped to enhance resources utilization efficiency and change the current development mode.

Along with the further expansion of the economy, environmental fallout has become increasingly severe. The pollution problem has spread from developed regions to backward areas, from urban to rural areas, and the overall environmental trend has been "improvements in some areas, but a worsening overall situation." According to the 2007 Report on the State of the Environment in China publicized by the Ministry of Environment Protection in June 2008, the water quality of 50.1 percent of the 407 sections of 197 rivers tested was at IV-V level (suitable for industrial and agricultural use only). In the seven major water systems, the Yellow River and Huaihe River suffer medium levels of pollution, while the Liaohe River and Haihe River are highly polluted. Although the emissions of principal pollutants have taken a downturn, the environmental situation is still serious.

Generally speaking, there are various and complicated reasons for China's resources and environmental problems. The main reasons include: a large population requiring the consumption of massive amounts of resources just to ensure survival; a relatively weak technical capability and management ability; and relatively low utilization efficiency of resources and the environment. China is experiencing industrialization, and the experiences of other countries show that industrialization inevitably demands the consumption of resources and pollutes the environment. Over the past 20 years, global manufacturing has largely been transferred to China, and to a certain extent China has become the world's factory. The toll on its resources and environment is the cost China has paid not only for the Chinese people's survival and development, but for the development of the world economy as well. This combination of factors means China is confronted with enormous pressure and challenges when it comes to resources and the environment, and must achieve a sustainable mode of economic and social development.

Second, China is undergoing a transitional period of social and economic development, marked by unbalanced development and inequality between urban and rural areas, as well as between different regions.

Since the reform and opening-up, owing to restructuring and regional economic disparity, resources have flowed into the cities from rural areas, and into east China from central and west China. While the flow has accelerated China's industrialization, urbanization and overall economic growth, it has also broadened the social and economic gap between urban and rural areas and among different regions.

In 1978, the proportion of GDP aggregate in eastern, central and western China was 52.4 percent, 30.7 percent and 16.9 percent respectively. In 2006 the figures were 61.8 percent, 25.3 percent and 12.9 percent. The per capita GDP ratio between the three regions was 1.75:1.17:1 in 1978, and 2.48:1.28:1 in 2006.

The price scissors effect between agricultural produce and industrial goods means that the wealth farmers created flowed into industrial and urban development, restricting the development of agriculture and rural areas.

The widening gap between the rich and poor has also aroused social concerns. While the number of rich Chinese people listed in Forbes grows every year, China still has more than 20 million impoverished people. The issue of social security for low-income people has become increasingly pressing, while the problems of housing, and access to medical treatment and schooling have become the hot discussion topics at the annual National People's Congress and the Chinese People's Political Consultative Conference. Problems like soaring house prices, the high cost of medical and educational expenses, and imbalances in education resources restrict China's move towards sustainable development.

These problems, however, are concomitant with the current developmental stage. The unfairness caused by development can only be solved through further development. The equity we pursue is based on constantly improving people's living standards, sustainable economic and social development, and increasingly harmonious interpersonal relationships. The CPC Central Committee and State Council are keenly aware of the development imbalance between regions, urban and rural areas, and individuals. The idea of balancing urban and rural development, regional development and economic and social development advanced by the 17th CPC National Congress aims to solve the problems of development imbalance and unfairness. The Third Plenary Session of the 17th CPC Central Committee again emphasized "constructing socialistic new rural areas, and forming an integral pattern of urban and rural economic and social development." The ultimate goal is to close the gap between urban and rural development. The solution of these problems also requires time and further economic development.

Third, the frequent occurrence of natural disasters and industrial accidents has created a serious challenge as regards risk management.

China's peculiar geomorphological structure and complicated geologic environment means the country suffers frequent natural calamities. The floods in 1998, and the severe snowstorms in southern China and the Wenchuan Earthquake in 2008, all created economic losses in the order of hundreds of billions of RMB, not to mention great loss of life.

China is at an industrial development stage that relies largely on heavy industry and mining. Therefore, mining accidents and pollution are excessive, and production safety accidents occur more frequently than in other developmental stages. Meanwhile, China's enterprises are at an initial level of development, and their sense of social responsibility needs enhancement. Accidents resulting from the excessive pursuit of profit are frequent. The recent scandal involving Sanlu infant formula milk powder is a heartbreaking example of placing profit over people's health.

Seize Opportunities and Face Challenges

2008 marks the 30th anniversary of China's reform and opening-up policy, as well as a crucial time for fulfilling the concept of the 17th CPC National Congress. Having deeply researched the achievements and problems in the field of sustainable development over the past 30 years, the Chinese Society for Sustainable Development (CSSD) will keep on studying the challenges of the new era, and provide the government with timely counseling to map out further strategies and policies. The CSSD is going to contribute more proposals on China's social and economic development in the future.

Deng Nan, daughter of Deng Xiaoping. Member of the 17th CPC Central Committee and the 10th Chinese People's Political Consultative Conference (CPPCC).

Deng Nan graduated from the Physics Department of Peking University in 1970 and worked at the Institute of Automation and then at the Institute of Semiconductors, both affiliated to the Chinese Academy of Sciences. Later she served successively as deputy director of the Policy Bureau and director of the Social Development Department of the State Science and Technology Commission, vice chairwoman of the State Science and Technology Commission, and vice minister of the Ministry of Science and Technology. Deng currently serves as chief executive secretary of the China Association of Science and Technology, as well as chair of the CSSD.

Established on Jan 14, 1992, the CSSD is a non-profit organization made up of scholars, administrators and entrepreneurs from the fields of population, the environment and natural resources. The Ministry of Science and Technology entrusts the CSSD to the Administration Center for China's Agenda 21.

The CSSD contains five committees focusing respectively on the ecological environment, sustainable agriculture, natural disaster precautions and reduction, water resources, and living environments. Deng Xiaoping inscribed the title of CSSD's Journal of Population, Resources and Environment.

Since 2004, the CSSD has been engaged as a non-governmental organization that consults with the Economic and Social Council (ECOSOC) of the United Nations, and is associated with the UN's Department of Public Information.

(China Today January 14, 2009)

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