1. Introduction

　　The China Council for International Cooperation on Environment and Development (CCICED) is a high level consulting body by the authority of the State Council, consisting of environmental protection exerts both from in and outside China. The Council provides constructive suggestions and recommendations to the Chinese government for its reference in making decisions, promotes financial support and assistance from international community for environmental protection in China.

　　The CCICED decided to establish the Working Groups in five areas at its first meeting (April 21-23, 1992). The purpose it to conduct investigation and research on important issues and make substantive preparations for discussion of the Council. Monitoring, Data Analysis and Pollution Control is one of the prior five areas. Because of its too broad contents, and upon the suggestion of Professor Qu Geping. Vice-Chairman of the Council, the CCICED separated the critical issue of pollution control from the original area of Monitoring, Data Analysis and Pollution Control for another independent group. In October 1992, the Working Group of Pollution Control was formally set up, which comprised both Chinese and international experts.

　　On the Chinese side: Professor Qu Geping (Co-Chairman)

　　Mr. Qiang Bighauan. Mr. Lin Dingshu

　　Mr. Wu Guanglai, Mr. Wang Fengchun

　　On the foreign side: Dr. T.Schneider (Co-Chairman)

　　Prof. M.J. Chadwick, Dr. Si Duk Lee

　　Dr. Nishioka Shuzo, Prof. A. Voss

　　2. Workplan

　　The objectives as described in the Terms of Reference are: with the support and assistance of the related agencies and departments on national and regional level s, the group will investigate and analyze the current state, trends and characteristics of environmental pollution in China as well as China's experience in pollution control; study and learn from the experiences of developed countries and newly-emerging industrialized countries on pollution control; in accordance with the new situation of market-oriented economic reform, conduct a thorough research on some strategic issues such as industrial pollution control, urban pollution control and control of major waterways and watersheds pollution; put forward recommendation on objectives and policy measures for pollution control with in the next decade which will be made available for the reference of the Chinese government in decision-making; and further improve the policy and management systems to achieve the harmonious and sustainable development of China's economy and environment.

　　The group will intend to spend five years in studying the following five sub-projects under the master project, "Some Strategic and Policy Issues of Pollution Control":

　　-China's present situation and expected trends

　　-Strategy for industrial pollution control

　　-Strategy of pollution control for township and village industrial enterprises

　　-Policy recommendations on urban pollution control

　　-Policies and management systems on pollution control of major waterways and watersheds

　　The group will submit annual sub-project reports, then combine them and present a final master report.

　　According to the workplan mentioned above, this year the report will focus on discussing the guidelines for China's pollution abatement. Based on surveys and analysis of the current state, future trends, characteristics of environmental pollution in China as well as the experience of pollution control, the report proposed the guidelines which should direct the follow-up sub-project research, and is important for the group to do further study on China's pollution control strategy.

　　THE BASIC GUIDELINES

　　FOR POLLUTION CONTROL IN CHINA

　　Part A Progress and experiences of pollution control in China

　　since 1980s, with implementing economic reform and open-door policy, China has made great achievements in economic development and improvement of people's living standard. In 1990, China's gross national product (GNP) reached 1,740 billion yuan and national income (NI) 1, 430 billion yuan. In terms of comparable prices, the annual average growth rate of GNP and NI was 9.6% and 8.7% respectively from 1980 to 1990. While the demand of the majority of people's food and clothing is met, part of the rural and urban residents are heading for a relatively comfortable life. This decade was the period with the highest economic growth rate in Chinese history. Generally, rapid economic growth is inclined to exert great pressure on environment. Concerned to this fact, the Chinese government made environmental protection as one of the basic state policies, formulated and effected t he strategy that environmental construction and economic, urban and rural construction should synchronize with each other in planning, implementation and development to achieve economic, social and environmental benefits together. In the light of China's practice, the Chinese government also developed three major environmental policies such as "Emphasizing Prevention and Integrating Prevention with Treatment", "the Polluter Treats" and "Enhancing Environmental management"; carried out a series of effective systems and measures and made significant achievements in environmental protection. AS A result, environmental state remained relatively stable on the whole.

　　1. Major Progress of Pollution Control in China

　　Over the past decade, the capability to control pollution comprehensively and utilization efficiency of resource and energy have been improved through adjusting industrial structure and allocation, overall developing technical innovation and building a large number of pollution control facilities. Energy consumption per ten thousand yuan of industrial output decreased from 13.36 tce (tons coal equivalent) in 1980 down to 10.50 tce in 1985 and 9.3 tce in 1990. The amount of industrial waste water, solid waste, smog and industrial particulate matter discharged for the thousand yuan of industrial output also dropped markedly. At the same time, the total amount of smog and particulate matter emission reduced. On the other hand, the standard-meeting rate of industrial liquid waste, collecting smog and particulate matter (from fuel burning) ratio and industrial particulate matter recovery ratio as well as the rate of comprehensive utilization of industrial solid waste all increased substantially, while the heavy metal release greatly reduced (Seen in Table 1). Under the case of industrial growth by more than 10%, industrial pollution rise slightly. Water quality of major rivers and most of the se a waters remained generally well. The full development of comprehensive urban environment treatment had achieved initial results. The standard-reaching area of p articulate matter controlled district expanded from less than 500 square kilometers in 1985 to 10, 468 square kilometers in 1992. There were 62.25 million residents in 314 cities using gas, and gas use popularization in cities covered from 15% in 1980 up to 42.2% in 1990. The urban central heating area reached 213 mill ion square meters. In some key cities, although coal consumption had doubled or even tripled, the amount of falling dust in the atmosphere reduced considerably an d TSP remained the same level or even gently fell. The daily treatment capacity of urban sewage surpassed 10 million tons. The state of water environment in some cities has been improved.

　　Table 1. Statistics of Prevention and Treatment of "Three Wastes"

　　Notes: (2) SO2 emission in 1982

　　Sources: 1. A Collection of environmental Statistical Data (1981-1985), Published by China Environmental Science press.

　　2. Environmental Statistical Yearbook, 1986-1990.

　　2. The way of environmental protection with China's characteristics

　　As a developing country with huge population and lower per capita CNP, China is making every effort to protect environment and has put environmental protection into political agenda. Over past 14 years ' economic reform and opening to the outside world, China's economic construction and comprehensive national power have been greatly enhanced. The way of environmental protection with China's characteristics is being explored and initially formed. AS practice showed, strategically, the following guidelines and policies should be carried on in the field of pollution control;

　　-Adhering to the strategy of paralleling the planning, implementation and development of environmental construction to those of economic, urban and rural construction; abiding by the principle of integrating environmental benefit with economic and social benefits; incorporating environmental considerations into the national socio-economic development plans and long-term programs; and committing macro management, adjustment and control under the guidance of the state plan, to ensure environmental protection and other undertakings of construction could be taken into full account and developed in a balanced and harmonious manner.

　　-Implementing pollution control strategy highlighting rational exploitation of natural resources and improvement of utilization efficiency of resources and energy; integrating socio-economic and environmental benefits in the process of pre serving and developing productive forces, meanwhile, making attempts to reduce pollutants by relying on the progress of science and technology.

　　-Continuing the policy of "emphasizing prevention and integrating prevention with control".

　　overall planning and rational adjustment of industrial structure and allocation;

　　development of comprehensive urban environmental treatment, treating "foul nuisances" (sewage, smog, solid waste and noise) in cities;

　　for any project on new construction, renovation or expansion, implementing environmental impact assessment (EIA) and "the three simultaneous regulations" which means that the pollutant treatment facilities must be designed, constructed and operated simultaneously with the principal part of the project, to strictly control the new pollution source emerging;

　　promoting combination of the centralized pollution treatment with the decentralized treatment to control the pollutants from industry and urban life.

　　-Sticking to the policy of "the polluter treats" and "the exploiter protects" and clearly defining the responsibility of environmental protection and the principle of the polluters pay.

　　stressing prevention and control of industrial pollution through technical inn ovation, and use high-efficiency and low-emission clean technology in place of backward one;

　　implementation of the pollutant discharge "permit" system"

　　setting deadlines for treatment of major serious pollution sources;

　　laying equal stress on both resource utilization and conservation, and the exploiters should bear the responsibility and expenses of protection and recovery of ecological environment;

　　implementing effluent fee system to have the polluters pay to compensate the damage or loss caused by pollution.

　　-Enhancing environmental management. It seemed to be particularly important in China's present circumstances of underdeveloped economy and limited environmental investment.

　　formulation and improvement of environmental laws and regulations;

　　establishment of the responsibility system, examining both socio-economic and environmental benefits;

　　formation of an institutional framework of environmental management which performs on the national, provincial, municipal, county, township and even the basic unit level, to strengthen coordination and supervision;

　　-Development of dissemination and education in environmental protection to awake all nation's environmental awareness; advocating that everyone have his responsibility to conserve environment; linking the monitoring and supervision of professional teams with that of the public to bring public opinion into full play.

　　Part B The problems in pollution control facing China

　　Over the past ten years or more, the environmental state in most of the cities and major rivers remained relatively stable and did not deteriorate increasingly with rapid economic growth, however, this kind of control is low-level and its basis is unstable. With population growth, economic development and the raise of people's consumption standard. resource depletion and pollutants discharge will augment. So China is still faced with serious challenges in pollution control

　　1. With the high speed of industrial development, waste water release is increasing, and the annual growth rate of urban domestic sewage has amounted to 7%, of which large quantities discharge without treatment. The organic pollution of the water in urban and its surrounding area is w45bvgftrorsening; the indexes of three nitrogens and hardness in ground water of partial cities are inclined to rise. With the increasing demand for water and aggravating water pollution, some areas short of water resource in North of China will suffer from serious water crisis.

　　2. The rise of coal consumption caused SO2 emission with an annual growth rate of 5%. In most of cities, the concentration of SO2 in the atmosphere lay between two-grade and three-grade of national air emission standard, and the TSP concentration has exceeded two-grade standard. Acid rain is gradually expanding in the southwest of China.

　　3. Vehicles in cities is growing by nearly 10% per year, but the road conditions and pollution control measures fell short. The pollution of tail gas and noise was serious and will be getting worse.

　　4. The cumulative piles of solid wastes reached 6.75 billion tons, covering 56.0 000 hectares of land. Poor disposal let to the serious second pollution; and a lot of toxic and harmful wastes discharge without effective treatment will be a potential threat.

　　5. With the over-speed development of township and village industrial enterprises (TVIEs), a large number of TVIEs with small size, scattered distribution and backward technology boomed, which made environmental pollution has a tendency of expansion from cities to the rural areas.

　　6. China is transferring to a market economy and the market mechanism will become increasingly important. In is likely to lose control of environmental pollution if environmental policies and management can not timely adjust to the new situation.

　　In short, the state of China's environmental pollution is that pollution has been controlled in some areas but on the whole it is getting deteriorate. Environmental issue, as an important component affecting socio-economic development, must be taken seriously.

　　Part C State situation analysis and pollution control strategy

　　Analysis of China's conditions and environmental issues provides a basis to research and formulate China's pollution control strategy and policy. In our on-going research, we should consider the following principle characteristics:

　　1. China, as a developing country with a population of 11 billion is one of the largest countries in the world. It is abundant in resource reserves and formed national power to a certain degree. However, China still belongs to low-income countries because of her lower per capita CNP. Currently, the major environmental problems are caused by economic underdevelopment, and the ability to address the problems is also affected by economic bearing capacity.

　　-To develop economy and speed up industrialization so as to eliminate poverty is of the first importance. Enhancement of economic power is essential to resolution of environmental issues, but rapid economic activities will bring great pressure to environment, therefore, coordination of environmental and economic development is a hard and challenging work for China.

　　-While the industrial technology has gained some improvement, on the whole it is backward with high resource and energy consumption per unit of product (Seen in Table 2) and high coefficient of pollutants discharge. There is an urgent need for China shows great potentiality of obtaining economic benefits and environment amelioration.

　　Table 2. Energy consumption of several major products

　　Source: Papers Collection of Workshop on Energy Efficiency and its Impacts on Environment, Energy Ministry And World Bank.

　　-The work of environmental protection started late and was confronted with serious environmental problems from the right beginning. Its rapid development will need substantial inputs which contradicts insufficient capital.

　　2. The objective of China's economic reform is to establish the market economy. It is a significant turn, from highly-centered planned economy to market economy. Accordingly, a series of system reform and policy adjustment will be needed.

　　-The shift from planned economy to fully-developed market economy will be a long and complicated process. It is inevitable to create friction and collision between two systems in the transform period, which will have impacts on the field of environmental protection.

　　-Market mechanism will be conducive to the growth of resource utilization efficiency, thus to control of pollution by reducing the wastes. Nevertheless, the market itself does not reflect social costs caused by environmental destruction. It cannot provide restrictive mechanism to curb pollution. Therefore, the government should play a leading role in the area of environmental protection. Now the critical issue lies in how the government employs more economic measures to implement environmental management. This has been a weak link in the system of China's pollution control policy.

　　-After the enterprises are pushed to the market, the old ones, especially the state-owned ones will treat pollution by their own accumulate funds. It will be a long process for the enterprises to form the ability of self-development and self-regulation, particularly to the present deficit enterprises, accounting for approximately one-third of China's total enterprises. What impacts of the long-stage transition will pose on pollution control will depend upon the results of policy modification and coordination to a great extent.

　　-Accompanying with the change of government function, the reform will be penetrated in government department. The previous sector management network of pollution control will very greatly. The regional and local management network is becoming a gap or weakened at some areas. How to modify and improve environmental management is undoubtly an important issue.

　　3. China is at a stage that population structure is changing at the largest scale and the fastest speed in Chinese history. A large number of agricultural population is shifting to the second and the third industry, and also from the rural to the urban area.

　　-TVIEs developed rapidly. By 1990, there have been 18.5 million of TVIEs with total workers 92.64 million in China. They are expected to develop more speedily in the 1990s, and hundreds of millions of agricultural population will move to the second and the third industry. With the development of TVIEs, small towns and industrial zones will spread all over the vast rural area. Much attention should be given to environmental planning and pollution control in the construction of towns and villages to avoid likely adverse effects.

　　-The process of urbanization has speeded up greatly. The number of cities has grown from 138 at the early period of the PRC's founding to 484 in 1990, 58 of which were large cities with a population over 500,000. While urban population was only a share of 28.6% in total population, its absolute figure topped the world.

　　By the of this century, the number of cities will have exceeded 600,and the populace living in the cities will probably go up to 0.32 billion. The former poor urban infrastructure will not meet with the demand of swelled population, which will overburden the city ecological system and create serious urban environmental problems. Therefore, urban pollution control is an arduous undertaking.

　　-With economic reform and opening to the outside world, came in the so-called "rural laborers tide/that thousands of millions of peasants flowed like tide to the coastal relatively developed area or to the cities. Those people not yet counted in urban population actually have brought heavy pressure to bear on transportation line and urban environment.

　　4.China has a vast territory, varied conditions and unbalance of economic development

　　-There exists a great disparity in natural environmental condition between the East and the West, the South and the North of China. For dance with the precipitation distribution, that is generally in accordance with the precipitation distribution, that is, more water in the southeast and less in the northeast of the country, with a gradual de-crease from the south -eastern coastal areas to the northwestern interior. a region short of water seriously.

　　-Mineral and energy resources are also dispersed unevenly, mainly in the west, central and northwest of China, where resource and energy exploitation and rough -processing industries are relatively concentrated on, leading to a higher pollutants discharge per ten thousand yuan of output value.

　　-Regional economic development was unbalanced, also in the last decade, this unbalance has been aggravated. Among three areas, compared by economic development degree and people's income level, the coastal areas had the most developed economy and the highest people 's income level, and the middle area ranked the second, and the western area was lagged far from them, In addition, there has been a few poor areas where the issues of food and clothing is still unable to be solved.

　　-China's population distribution is rather uneven.3/4 of the population is concentrated on the eastern and central parts of China, making up44%of the total land area, whereas 1/4dispersed in the southwestern land. This population distribution reflects the characteristics of regional unbalance in socio-economic development as well as national conditions.

　　-In terms of technological economic level, great disparity is seen among various sectors. China has not only the modern enterprises reaching 1980s'international advanced technological level, but also the old ones only equivalent of 1950s 'or 1960s'levels, and even still many wide-spread small manual enterprises. Consequently, greater disparity can be found in resource and energy utilization efficiency and in prevention and treatment of pollution.

　　Faced with the above situations, environmental policy should not only reflect difference and deal with each case by its condition, but promote progress and avoid protecting backwardness. This issue should be care-fully attended to.

　　5.Coal will continue to China' s major source of energy for a consider-able period of time, which is determined by energy resource characteristics and economic development level.

　　-China is one of the largest countries in coal production and consumption .Her per capita consumption, however, is very low, In1990, China's total primary energy, output is 1.04 billion tce including 1.08billion tons of raw coal, but per capita consumption is only 0.92tce, representing about1/3of the world average. By the end of this century, coal production and consumption will rise to around 1. 5billiontons.

　　-China depends on coal as her major source of energy, which provides 73%of the total commercial energy consumption. Also, coal offers 75%of industry fuel and power, 65%of raw materials for chemical industry and 85%of fuel for urban residents. In the next one decade or two, this composition will change slightly although hydropower and nuclear energy will be developed actively.

　　-Low ration converted into second clean energy is one of the reasons for serious air pollution from coal burning. (See table 3,the composition of China's coal consumption)

　　-The duality of China's energy consumption is low per capita consumption and high energy consumption per unit of output. That is right the key reason causing China's energy and environmental issues.

　　China's energy and environmental measures is only in accordance with the fact of coal as a major fuel at present stage .The difficult point for policy-making is just at here.

　　Table 3.Commposition of China's Coal Consumption

　　Part D The guidelines and recommendations for China's pollution control strategy and policy orientation in1990s

　　Based on the above analysis of the current state new situation and problems facing China, it is seen that China's development is at a historical turning stage, not only for economic construction, but for environmental protection. A severe test is put ahead of the government in coordination of the relationship between development and environment. In view of current conditions and general trend, it is impossible to have environmental quality improved greatly in 1990s (possible in some local areas), but every effort must be made to generally control the increasing tendency of pollution, because the environmental state next century will depend upon our today's efforts made. The future will be worrying unless the objectives can be reached that economic construction has an enormous leap, environmental pollution, for the most part, has been controlled, and major cities' environmental quality has been improved. Realization of the objectives will depend o n many factors such as policies, management, technology and investment. In order to further implement the guideline that environmental construction and economic, urban and rural construction should synchronize with each other in planning, implementation and development, some recommendations and suggestions on pollution control strategy, including economic incentive policies, environmental protection investment and environmental planning, environmental protection investment and environmental sound technology progress, are proposed as follows:

　　1. Adapting to the changed situation and emphasizing economic incentive policies to protect environment

　　In the socialist market economy, market is a tie of all enterprises' economic activities, and play its basic function on resource allocation under the macro management of the government. Accordingly, marker-oriented policies and measures should also be applied in environmental protection to influence or modify the behavior of resource users and polluters.

　　In short term, economic policies should be focused on the following four aspects:

　　—Augmentation and improvement of effluent charge system. Effluent charge system has been put into practice for many years in China and gain some achievements. However, the existing two problems downplay its role. The first one is too low per u nit charge to check pollution. The polluters would rather pay fee not actively treat pollution The second one is too narrow charge range, only charging over-stan-dard fee within the industrial enterprises. Therefore, it is an urgent need for amen ding the effluent charge regulation. Per unit charge should not be less than the average treatment cost. Nevertheless, due to current limited economic capability of most of the enterprises, as an interim measure, per unit charge at least should not be less than the operation costs of treatment of the same pollutants. The fixed per unit charge also needs to be altered, and the mechanism varied with and adjusted to the commodity price index should be formed. Furthermore, the range of effluent charge should be expanded, applied to not only industrial enterprises, but all polluters including service, communication and transportation, ect. In order to stimulate improvement of energy resource quality and energy conservation and control of pollution from coal-burning and vehicles, fee should be paid by contents of ash and sulphur in coal exceeding the stipulated standard. Besides, addition al fee should be paid for oil pollution.

　　—Implementation of pay use of environmental resources. Two policies should be studied at the moment. One is to charge compensation of environmental resources which means that the cost to treat/recover environmental pollution/destruction caused by resource exploitation should be compensated. There is a little difference between resource compensation, resource price and resource taxation. The other policy is to carry out the pay use of environmental carrying capacity and the tradable pollution permit to encourage polluters to reduce pollution on their initiative.

　　—Formulation of environmentally-sound credit policy. The undertakings relating to environmental protection belong to public utilities, some of which have not direct economic benefits, but in macro facet, they reduce external diseconomy and have socio-economic benefits. So preferential policies in investment and credit should be given to those projects on environmental protection although they cannot gain directly. Recommendations are proposed for establishment of national and local environmental protection funds to provide loans with discount and lower interest for the projects concerning environmental protection.

　　—Implementation of tax priority policies in environmental protection (including special and local taxation). Recommendations are put forward that the projects on treatment of environmental pollution should be exempt from tax on investment direction adjustment, energy, communication, electricity power development and urban infrastructure matching. In order to stimulate the enterprises to eliminate pollution in the process of production by technical innovation, the enterprises can be lowered or exempted from tax on reduced pollution load through technical innovation converted to equivalent treatment inputs. The present lower or free of taxation policies on waste comprehensive utilization need to be further bettered and implemented. More preferential policies should be formulated to support the newly -emerging specialized enterprises which collect, treat and reutilize "three wastes" (waste water, waste gas, solid waste).

　　2. Administrative compulsory management in pollution control based on environmental regulations is necessary to continue strengthening. In the course of shift to the market economy, it's undoubtedly necessary to take more economic measures in environmental protection, but it is only one-sided if administrative measures are thus ignored. In fact, the most effective policies on pollution control are combination of above two kinds of measure. As western experiences show, the market often can not either reflect the costs of environmental damage or restrict pollution. So the government had to interfere it, formulated laws and standards, established strong environmental management institutions, formed a set of strict supervision mechanism, as a result of long-term efforts environmental pollution has been alleviated. China's own experience has also proven the fact. Therefore, much attention should be paid to macro environmental management in the procedure of two systems transition.

　　- Persisting in implementing environmental impact assessment, the three simultaneous regulation, the responsibility system, discharge permit system, the system of setting deadline for pollution treatment and quantitative examination system of urban environmental comprehensive treatment, etc., and continue to develop and improve them in new situation.

　　- Current multi-sector management in water environment is disadvantageous to water resource management and water pollution control, and will aggravate environmental disputes. So research should be focused on establishment of unified management system of pollution control by waterways and watersheds to effect the definite responsibility system.

　　- Enhancement of environmental supervision and management calls for powerful institutions with high-efficiency, especially in China, a developing country with huge population. The network of environmental supervision management at various levels need to be further improved.

　　3. Classified guidance in the light f characteristics of each region. As it is summarized above, China has a vast territory and exists great disparity among regions in natural condition, resource reserve, population density, economic development level and major environmental problems, also the same between city and rural area, old city and newly-built city, large-, middle-sized enterprise and small enterprise. Therefore, the guidance to pollution control should be classified according to different conditions so as to get the best result of coordinative development of economy and environment. In principle, the research should consider t he following aspects;

　　- Owing to different level of economic development, the requirements for objective of pollution control are different. Furthermore, the disparity of environmental carrying capacity among regions calls for environmental standard, especially for the pollutants discharge standard suitable to regional conditions. Local standards can be allowed to set more strictly than national standard or more leniently. In underdeveloped areas, feasible standard rather than stringent one should be stipulated so that it could be widely conformed to.

　　- Formulating different environmental economic policies between developed areas including cities and underdeveloped areas in accordance with economic bearing capacity of each region.

　　- Different from newly-built cities and economic zones, old cities are heavily polluted. So in implementing quantity examination system of comprehensive urban environment treatment, different basis among cities should be identified. On the other hand, preferential policies and funds should be given to the old cities to make them address accumulated environmental problems.

　　- China's current pollution control policies and systems mainly focused on control of pollution from the large-sized and middle-sized enterprises. This lends a sense of urgency to the need for study of pollution control indirect policies and measures for many widely-spread small enterprises.

　　- China's environmental protection emphasized industrial pollution control and urban environmental treatment. In order to make environmental measures more suitable to the local conditions, it is necessary to transfer the centralized jurisdiction of environmental management to the municipal government.

　　4. Combining environmental planning and construction of centralized control facilities with the new area development and old city renovation. Now in China, many economic development zones and small industrial zones are being developed; mean while, at many old cities, the new area construction is becoming involved in the old city renovation. This objectively provide advantage to environmental comprehensive treatment and pollution centralized control, but also present a new issue, because neglect of planning or making improper plan will have long-term unfavourable impacts on economic development and environmental protection. Therefore, we should pay much attention to integration of planning, allocation and centralized pollution control.

　　- For all new economic zones, only after making a series of plans and assessing their impacts on environment, can the construction start. Wise planning must be made in light of the regional environmental carrying capacity.

　　- The economic development zones must be constructed with centralized pollution control facilities whose quality should be as high as possible.

　　- Urban domestic pollution is evidently tending to increase. We should accelerate the construction of urban public utilities such as central heating, gas use, solid refuse disposal and sewage treatment, combined with old town renovation.

　　- Setting up the industrial zones to develop TVIEs, integrated with the planning and construction of villages and towns; furthermore, to build TVIEs with rational and relatively aggregate allocation and make them form a scale economy. As a major part of environmental planning, comprehensive treatment and centralized pollution control must be incorporated into the allocation planning so as to leave land space for their development and avoid potential unremediable damage.

　　5. Gradual raising the proportion of environmental protection investment. From 1 986 to 1990, China's environmental protection investment has accounted for about 0.7 % of GNP. The objectives of environmental protection is that by the year 2000, China's environmental pollution will have been essentially controlled and the environmental qualities of major cities will have been improved. It is estimated that to achieve the above objectives, the required investment will be around 1 % of GNP of the same period. So the proportion of environmental protection investment must be raised step by step.

　　- Incorporation of the investment plan of environmental protection to national economic and social development plans and budgets at various levels.

　　- Strictly carrying out standards and environmental management system on construction projects, to ensure to provide necessary investment in fundamental construction and industrial technical innovation for pollution prevention and treatment.

　　- Urban pollution control should have an appropriate share of the investment in urban infrastructure construction.

　　- Gathering funds for pollution treatment with economic means such as effluent fee and environmental resource compensation.

　　- In light of the principles of "the polluter pay" and "the beneficiary pays", application of policies and management measures to enable polluters and beneficiaries to finance.

　　- The government at various levels should appropriate some proportion of financial budget for environmental protection.

　　- Opening up the channels of credit funding for environmental protection.

　　- Expanding the scale of foreign investment in environmental projects to add to domestic limited for environmental protection.

　　6. Relying on the advancement of science and technology, and adopting environmentally-sound technologies to raise the benefits of environmental investment.

　　The ultimate resolution of environmental problems will depend on scientific and technological progress as well as advanced facilities which is also the basis of get the benefits from input to pollution control. Thus the research, development, dissemination and application of environmental science and technology should be encouraged to develop greatly.

　　- To research and develop or import new technologies, especially cleaning-coal technologies, to provide technical support for resource and energy efficiency and pollution abatement.

　　- To augment the technological research, development and dissemination relating to resources comprehensive utilization and transformation of "the three wastes" to useful resources.

　　- To screen, evaluate and promote the optimal appropriate technology of pollution treatment to obtain the greatest economic and environmental benefits with the least possible costs.

　　- To established a comprehensive information center/clearinghouse to implement efficient and cost effective information exchange and technology transfer.

　　- To enhance the "soft" science study including environmental predicting and planning; to formulate and implement environmental time-limiting standard to stimulate enterprises to employ advanced process technology and pollution control technical.

　　- To greatly develop environmental protection industry to turn the products of science and technology into actual productive forces, to manufacture a series of standardized and liable environmental instruments, equipment and other products.

　　- To expand the technological cooperation with international community, to import and absorb advanced technology of environmental protection abroad, and to attract foreign investment to develop environmental industry.

　　POLICY RECOMMENDATIONS SUBMITTED TO CCICED

　　BY THE WORKING GROUP ON POLLUTION CON TROL

　　With the development of township and village industrial enterprises (TVIEs), its impacts on environment become increasingly apparent. Environmental pollution is spreading from cities to the rural areas where a large amount of pollution is inclined to create serious health problems and damage to the agriculture development unless this trend is controlled effectively. Under this circumstance, the Chinese government should encourage to build public infrastructure and TVIE Development Zones, strengthen planning and guidance to integrate the development of TVIEs with the overall planning of small towns so as to change the scattered distribution of TVIEs to the aggregated one, and to implement centralized control of industrial pollution, which is a correct way to achieve sustainable development o f TVIEs. Luzhi Town in Jinangsu Province is such a successful example.

　　Annex: Luzhi Town, an Enlightening Case

　　In the south area of Jiangsu Province with highly developed TVIEs, there is a successful example, Luzhi Town in Wu County where TVIE development has been coordinated with town construction and environmental protection.

　　Luzhi Town is situated 25 kilometers far from the southeast of Suzhou, with a land area of 49.4 square kilometers and a population of 40,000, among which 20,000 live in the town built-up area. The town famous for beautiful rivers and lakes, long history and culture, is one of thirteen scenic spots in Tai Lake Landscape and Tourist Zone. The Baoshen Temple in the town is a national-level preserved historic relics. Luzhi's 72 half bridges and many rivers and lakes make it more like a picturesque "water" town. In the late 1980s, the local government formulated and implemented the guideline of "protecting old town and developing new area", resulting in effective pollution control and environment improvement while significant achievements in economic development are harvested.

　　Major measures are taken as follows:

　　1. Integration of planning and readjustment of distribution

　　In the middle of1980s, the town began construction from planning and developed new area backed by the previous town. The new area is divided into several sub-areas, including residential district on one side of the old town, culture & educational district and commercial district on the other side of the town, but the industrial district is set up far from it. The planned new area is 5.5 square kilometers. During the construction of the new area, 12 enterprises and institutions causing pollution are forced to move from the old town and 4 enterprises are closed. By 1991, the industrial district has hosted almost 30 enterprises with total output 0.27 billion yuan, representing around 80% of the total town industrial output value. The present new area covers 3.6 square kilometers, showing a look of a newly-built town with rational functional division.

　　In accompany with the new area construction, two small zones for control of smog and fixed noise sources are established to promote environmental protection of the old town.

　　2. Improvement of town infrastructure and centralized control of environmental pollution

　　The infrastructure construction is highlighted in building the new area. A concrete main road connecting plants is paved, two water plants with capacity of 1600 m3/day are built and 1000 programme-controlled telephones are installed. Particularly, a con-generation plant and a sewage treatment plant were built timely in early 1991 in order to raise economic benefits and control environmental pollution. Two plants were invested 18million yuan together and put into operation in January and September, 1992 respectively. The co-generation plant mainly supply heat and use surplus heat to generate power. A boiler of 20 stream tons/hour and two 1500kw power-generating units are installed, thereby replacing 26 chimneys. T he sewage treatment plant with designed capacity of 6000 t/day treated all industrial waste water and partial domestic sewage. After two-grade biochemical treatments, the water quality completely met the national standard. It is roughly estimated that this way will be invested 2.08 million yuan less that the decentralized treatment and yearly save treatment expenses 0.839 million yuan. Both plants are managed in a business way.

　　3. The planned objectives of the next-stage development are to build a modern town with developed economy, flourishing market and beautiful environment.

　　- detoxication treatment and transformation of the domestic refuse (including manure) and other solid wastes in the town to useful resources.

　　- the best possible gathering of the domestic waste water discharged from various functional districts to sewage treatment plant for centralized control.

　　- promotion of gasfication and solar energy use.

　　- tree plantation, river course treatment and dredging.

　　- exploration village and town integration from the view of environment, while the town is heading for urbanization.