I wish to express my thanks to the international members and experts for their recommendations. These recommendations are very helpful to China's environmental protection. During the First Phase, the Council has been very effective and successful. International members mostly come from developed countries. They bring t heir expertise, knowledge and experience to China. This sets up a good example o f developed countries providing assistance for developing countries. I hope that the Council could be even more successful in the Second Phase.

　　We have just successfully convened the Fifteenth National Congress of the Chines e Communist Party. The Congress clearly put forward the strategy of rejuvenating the country through science and education and the strategy of sustainable development. Few people in the World would doubt that China's modernization process would keep its good momentum. But environment and development is a big subject. We are now faced with the challenging question of leaving what kind of environment f or future generations. Two ways of developing economy should not be allowed: One is to destroy resources and compromise the ability of future generations to meet their own needs; the other is to take treatment measures only after pollution problems have already occurred. The price for either of these two ways will be very high, and the consequences will be serious. Therefore, we have adopted environmental protection as a basic state policy, just as we have done with family planning.

　　While the Chinese Government adheres to the two strategies of rejuvenating the country through science and education and sustainable development, it also actively seeks for two transformations: the transformation from an extensive economic growth pattern to an intensive one, and the transformation from a planning economy to a market economy. Market can promote economic development, but if government doesn't exercise effective regulation and control, environment will fall victim to economic development. Developing countries need to modernize themselves. It is not fair to restrict or freeze their absolute energy consumption. For instance, it is clearly not practicable to freeze China's CO2 emissions. On the other hand, China's per GNP unit electricity consumption is much higher than that of m any developed countries. So there is great potential for energy saving in China. It is unsustainable to consume energy unlimitedly. Therefore, we attach equal importance to energy development and energy saving. Another example is that, 5 years ago, with every 1% increase of GNP, China's energy and electricity consumption would increase by 1% as well. After 5 years, the energy consumption increase has dropped to 0.8% for every 1% GNP increase. In the first half of 1997, it was 0.5%, while coal consumption increase was only 0.3%. We believe that correct energy policy is of vital importance to environmental protection and economic development.

　　Much progress has been made by China in environmental legislation in the past years. So far, China has formulated and promulgated laws on the prevention and control of water pollution, air pollution, solid waste pollution and noise pollution. Laws have also been made on water resources, forest resources and mineral resources. This reflects the strengthening of environmental protection in a wider s cope. Of course, legislation is not the ultimate goal. Our objective is to strengthen management and environmental protection by legal means. For laws to be effectively implemented, supervision measures are essential. As you may or may not know, there is a TV programme in China called China's Trans-Century Environmental Protection Inspection Campaign. This programme honors those who do well in environmental protection, criticizes activities that violate environmental laws, and exposes some typical bad cases. This way of enforcing environmental laws is even more effective than imposing fines or removing the responsible people from office. Some local government officials and enterprise leaders are more afraid of being exposed on television than being criticized or being removed from office. Therefore, we need to make good use of the influence of the public and the media to strengthen supervision.

　　Our environmental protection measures have taken initial effect. China is a big agricultural country, with 900 million people living in the rural areas and a per capita arable land area of less than 2 mu. In some places, the per capita arable land area is less than 1 mu. It is virtually impossible for rural people to get rich simply by relying on such limited amount of arable land. The only way out is to raise productivity by means of mechanization so as to liberate labor. But t his would give rise to another problem. In some developing countries whose economy is very underdeveloped, farmers pour into cities in large numbers, and build slums around cities. As a consequence, the living environment is very poor and t he pressures on cities is very serious. We have taken note of this problem, and would try to avoid it in China. China makes a point of developing Township and Village Industrial Enterprises (TVIEs) in rural areas, and has made great progress. One third of China's output value now comes from TVIEs. It is estimated that 12 0 million people are engaged in TVIEs. Of course, because of limited rural conditions, TVIEs do not have modern facilities and technologies, and have exerted pressure on the environment and ecology. We should, on the one hand, recognize the contribution of TVIEs to developing the economy and raising people's living standard; and on the other hand, raise environmental standards, strengthen management and require those TVIEs that cause pollution to take treatment measures within limited time. Those that can not meet standards will be forced to stop their production lines for treatment or even shut down. Our efforts along these lines have produced remarkable effects.

　　We have also made considerable progress in the popularization of gas use. From October 1 of this year, natural gas is able to be transported from the north of Shannxi Province, which is more than 800 km away, to Beijing. So far, Leaded gasoline has been banned in 6 cities. For urban transportation, we encourage the development of public transport. But we cannot forbid private cars. This is out of consideration of both people's demand for higher living standard and the need to control pollution. Now wastewater treatment systems have been built in many cities. The treatment of Suzhou River of Shanghai is such an example. Wastewater treatment plants have also been built in Beijing, but they are not enough. You may have all been to the Forbidden City. The moat of the Forbidden City has been polluted, and would be treated very soon. Garbage disposal has always been a problem. We have started the practice of sorting garbage and disposing of it in bags. We will also expand centralized heating systems. Coal is China's major energy source, and we are trying to reduce the proportion of coal in the energy make-up.

　　I know that issue of CO2 emission is of concern to you. Upon the completion of the Three Gorges project, 50 million tons of coal can be saved each year in the past, many overseas people didn't understand the situation and were against the project. But now they have changed their mind. Canada has always been a supporter o f this project.

　　Just now you offered six recommendations, some of which I have already touched up on. The issue of pricing policies is very important. If the prices of resources are too low, consumption will increase. SO far, the prices of electricity, water and coal in China are all lower than at the international market, but the prices of grains in China are already higher than international prices. It is necessary to adjust prices at proper times, but it should not be done too rashly. If we could raise deficit of coal to the international level, namely US$ 34 per ton. The reason is that if we raise the price of coal, the price of electricity will rise to o and the price of other products and services will consequently go up as well, which will incur a series of problems. Greenhouse effect is another issue of concern to people, We live on the same planet and faced with the same problems. Refrigerators and air-conditioners use CFC, and contribute to ozone depletion. This year, Beijing had abnormal weather and was among the hottest cities in China. As a result, the sales volume of air-conditioners increased. In order to protect t he environment, we have started to use CFC-free technologies in order to reduce the use of CFC. So we are making efforts.

　　Half of China's land area is not suitable for plant growth. We are very much concerned about the possible decrease of forest coverage. Fortunately, our forest c overage has not decreased, but rather increased from 11% of 1950s to the present 13%. We are now carrying out the treatment of the Loess Plateau with a view to improving the ecological environment and preventing desertification there. We a re also strengthening measures of protecting the vegetation in the upper reaches of the Youngest River. The treatment of the Yellow River Basin is also in process. Up to now, we have established 800 nature reserves.

　　China's environment does not meet due standards in many aspects. Our goal for the end of this century is to basically curb the trend of environmental degradation. We hope that, through 30-40 years of efforts, China could basically realize modernization and catch up with medium-level developed countries. During this time, We would do our best to make environmental protection meet the demand of modernization.

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