Excellencies, Distinguished Delegates,

　　Thank you very much for this opportunity to touch upon some of the major challenges that we all are facing - one year after the World Summit for Sustainable Development in Johannesburg.

　　It is indeed an honour to address the China Council for International Cooperation on Environment and Development. During the past decade, the policy recommendations of this Council have played an active role in promoting the sustainable development strategy in China.

　　Needless to say, if we are to deliver on our commitments from Johannesburg and the UN Millennium Summit, the substantial progress with regard to sustainable development in this country will constitute a major contribution.

　　It is therefore heart-warming to learn about the great achievements that this Council has contributed to - in particular with regard to support for cleaner production programmes and the comprehensive treatment of the urban environment and transportation, that has taken place in a number of Chinese cities (Shenzhen, Dalian, Qingdao and Kunming).

　　I had the opportunity to listen to the speech that Mr. Xie gave at the UNEP Governing Council earlier this year on sustainable production and consumption. I also know that the China Council has done a most impressive job in giving advice to the Chinese Government on how to address this complex, but important issue. Let me share with you a few of my thoughts on this matter.

　　Time and again we are told that development in developing countries are/is going in the wrong direction. This is too simplistic an assessment. There has been significant social and economic progress, both in developed and developing countries during the last decades.

　　Within the last 25 years, life expectancy in the developing countries has increased with 8 years, whereas in OECD-countries it has increased by 6.

　　The last 30 years the child mortality rate is about halved in developing countries.

　　As a group, developing countries have experienced significantly stronger economic growth than developed countries. China has been a lead country in this regard, having two decades of very high economic growth.

　　However, huge differences exist among developing countries. Whereas Asia has experienced the strongest growth, Africa remains a challenge. We have to find out what has worked - what has not.

　　In my opinion, developed countries bear a special responsibility to assist developing countries in "leapfrogging" some of the unsustainable choices that the developed countries have made - and go directly to profitable, but more sustainable solutions taking due account to the environment.

　　The challenge is to achieve more growth with less use of land, resources, energy, harmful chemicals and waste. It is essential To de-couple economic growth from environmental damage in order to protect nature. It is also essential in order to eradicate poverty. In short – it is essential to sustainable development.

　　In my opinion, it is a prerequisite for sustainable development that we:

　　1) Apply the polluter-pays principle

　　2) Eliminate harmful subsidies

　　3) Create new markets

　　4) Focus on cleaner production

　　5) Let consumers make informed choices

　　We need to apply the polluter-pays principle

　　Pollution is not free. Pollution leaves the bill for cleaning up to our neighbours, and it leaves the costs of lost species to our grandchildren. Therefore, a company must not only pay for the internal cost of production. The company should also pay the external costs for its impact on nature and society.

　　Our experiences have shown that countries should apply licensing policies, taxation and resource pricing to make real costs visible. This does not necessarily impose long-term competitive disadvantages, making companies less profitable. On the contrary such measures may encourage business and industries to produce in ways that are both more cost effective and less damaging to nature.

　　Moreover, environmental protection might provide new business opportunities. Waste from one company can become economic input for recycling industries. We have several examples of such business opportunities in the paper and pulp industry, in the aluminium industry, and in the waste management industry.

　　We need to: eliminate harmful subsidies

　　This means For example that it should not be cheaper to buy subsidized fuel rather than adjusting the car engine for reduced consumption, or it should not be cheaper to let the subsidized water pipe stay open rather than installing water-efficient washing machines. Governments should not encourage the degradation of environment by paying for it!

　　Harmful subsidies waste money regardless of need - money that could have been targeted to give the poor a better life.

　　We must continue to create new markets:

　　The most important is not how strong environmental regulations are, but that businesses have a level playing field. Environmental regulations not only make some harmful products unprofitable. They also open new markets for innovative businesses.

　　Leaded gasoline is one example. Leaded emissions are extremely harmful to children, interfering with the brain and other organs. Poor air quality causes 3 million deaths each year. Most OECD countries have eliminated leaded gasoline and phased down sulfur in diesel and gasoline fuels. Everywhere, it should be more profitable to sell "healthy" fuels than harmful fuels - and we do have the means to ensure it.

　　We should focus on cleaner production

　　Decisions on materials, purchases and design are important to determine product life, lifetime resource use and whether the product can be easily repaired, recycled or disposed. Both costs and environmental impact can be minimized through applying the cleaner production concept.

　　Such programs may not solve all environmental problems at a facility, but they will reduce the need for end-of-pipe equipment and create less toxic waste to treat and dispose of. They reduce workers' exposure to hazardous chemicals and usually the number of accidents that can harm the surroundings. Products designed with cleaner production in mind are often less harmful for consumers and produce less waste.

　　Let consumers make informed choices

　　If someone sells toxic goods that damage health, the law will catch the producer, consumers will be scared and sales will drop. If you buy goods where the emissions in the production process damage your health and environment, you may not even know it until your tax bill increases to pay for the cleanup.

　　Consumers have a right to know how their purchases will affect them. They have a right to choose not to buy if they are aware that their purchases will harm others. Life-cycle analysis is well established as a valuable design tool. Eco-labels already give consumer guidance Green purchase is rapidly spreading.

　　Sustainability is not only a precondition to ensure that the natural capital is not used up or damaged, but may also be the source of sustainable production tomorrow. Only strong certification, labelling and international cooperation can stop the trade in illegally mined diamonds and illegally logged timber. Most countries have laws that prohibit the sale of stolen goods. But we still lack sufficient laws that prohibit the sale of stolen natural resources!

　　Eco-labels must, however, be applied in a non-discriminatory fashion by having transparent criteria for labelling and the necessary information and competence. The EU-countries have their own label. The Nordic countries have another label providing good public relations for business and industries.

　　These points are but some important elements related to this issue of sustainable production and consumption. At the upcoming 12th Session of the Commission on Sustainable Development, we will discuss this issue in relation to water, sanitation and human settlements - the three focus areas of the Commission for the coming two years.

　　The World Bank has estimated that some 500 million of this region's 1,8 billion people do not have safe water, and 900 million are without safe collection of sewage. The gap between rural and urban areas remains extremely wide, especially in Eastern and South-central Asia, where coverage in rural areas is only about one quarter of the population, while urban coverage is 70 percent.

　　It is time to stop being defensive. What is needed is political courage.

　　You are all aware of the challenges:

　　More than 1.2 billion people around the world lack basic water supplies.

　　More than 2.6 billion people do not have access to adequate sanitation.

　　The global goals on water require that safe drinking water be delivered to another 270,000 people every day for the next 12 years.

　　The sanitation goal means that basic sanitation must be made available to another 370,000 people every day for the next 12 years.

　　Although a daunting task, I believe it can be done. We owe it to ourselves, and most of all to our children, and their children.

　　The targets are ambitious – they demand the best of us – all of us.

　　How are we doing so far? What are the prospects of reaching the targets?

　　China, with 1,3 billion people, will probably achieve most of the Millennium Goals. India, with one billion people, is on track to meet the overall poverty goal. In South Africa, free access to basic water supply is well in reach.

　　In 1994, 15,2 out of South Africa's population of 40 million lacked access to basic water supply. Last summer. President Thabo Mbeki attended the celebration of the 9th million new receiver of free water since the program was initiated. At this rate of progress, access to basic water supply will be universal by 2010.

　　At the same time, let us not forget that Sub-Saharan Africa, with 600 million people, is lagging far behind. With current projections, the number of people living in absolute poverty will increase, not decrease. This requires an increased effort by all of us.

　　We must encourage alliances and partnerships to drive the process forward.

　　Governments set the tone of action. They must lead the way and provide the necessary resources. But governments can not do it alone.

　　The goals may be global in character, but they must be implemented locally, where people live and where shelter and services are required.

　　Here, the role of local governments is crucial.

　　So is the role of private enterprises and civil society. We need private actors who can accelerate growth and provide affordable and sustainable technological solutions.

　　Equally important is having good examples of how market mechanisms can play an important role in the field of environment and development. In this regard, the China Council has led the way, by carrying out policy and project demonstrations on major and urgent issues in the field of environment and development in China.

　　We also need civil society to carry out valuable work on the ground.

　　The WSSD was a summit where the necessity of such partnerships was underlined. Let us all take pride in ensuring that the partnership idea of the WSSD will come to be seen as the beginning of a process, rather than the end of one.

　　Your Excellencies, Distinguished Delegates,

　　The CSD has been challenged to assist in transforming the ambitious goals of the Johannesburg Summit into viable action for our common future.

　　But, the CSD is not supposed to - or equipped to-to do the job alone. There is no single agency, nor country that actually can. But everyone can give a small contribution in order to get the job done.

　　We must mobilise the political will to provide additional resources and we must encourage alliances and partnerships to drive the process forward. We must get business and industries stronger involved to increase the volume of investments.

　　As Chairman for CSD12, I see the transformation of words into action and focusing on implementation as our main challenge.

　　We must deliver on our commitments from Johannesburg, and we must demonstrate results in the fight against poverty and environmental degradation. Collective efforts are needed and we all have a responsibility to do our outmost to help the world achieve the targets to give the poor people the services they require and a life with dignity and respect.