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Newsletter (December)



  The Fifth Meeting Of The Second Phase

  The 5th Meeting of the 2nd Phase of the China Council for International Cooperation on Environment and Development (CCICED) was convened in Beijing from October 13 to 15, 2001. The meeting was attended by 85 council members, co-chairs of working groups and task forces, special invitees and observers. It was chaired in rotation by three Vice-Chairs, Xie Zhenhua, Minister of the State Environmental Protection Administration (SEPA), Len Good, President of the Canadian International Development Agency (CIDA), and Qu Geping, Chairman of the Environmental and Natural Resources Protection Committee of the Nation People's Congress (NPC).

  Vice Premier Wen Jiabao, also Chair of the CCICED, opened the meeting. While noting China has made significant progress in the past five years, Wen said that the country has new targets for ecological construction and environmental protection in its 10th five-year plan period (2001-2005). By 2005, the worst areas of ecological damage in China will have been arrested; forest cover will have been raised to 18.2 percent, with green land in urban districts up to 35 percent. He noted that there had been a noticeable improvement in the quality of the environment in urban and rural areas, and with a 10 percent drop in the gross volume of major pollutants discharged in 2000.

  Wen also emphasized the importance of speeding up implementation of environmental protection and sustainable development while hastening the adjustment of the economic structure. He commended CCICED for providing the Chinese government with many valuable recommendations for scientific decision-making. He urged all the members and experts to continue to carry out in-depth research and discussion and put forward their recommendations to the Chinese government on major issues of environment and development for China in its new five-year plan period.

  Minister Xie attributed a number of fundamental changes in the area of environmental protection both practically and theoretically in China to the contribution of the Council.

  This tenth meeting of the Council undertook a review of the results achieved over the past decade since its inception in 1992, and took stock of possible changes needed for its future priorities and procedures to ensure its effectiveness as a high level advisory body to the government of China on issues of environment and development. All participants agreed that the Council is a unique institution; it has brought together people from China and other parts of the world to cooperate in promoting sustainable development in China. All members have valued and profited from the experience.

  Vice Chair Len Good noted that the Council has provided a unique opportunity to work in one of the world's most important and complex countries during a period of rapid and fundamental change. The Council tackled a broad array of problems emerging from China's rapid economic and social transformation and has produced recommendations designed to cope with the large scale impacts caused by this rapid change.

  Participants to the session also listened to and discussed reports by representatives from Asian Development Bank (ADB), UNEP, UNDP, the State Development Planning Commission, the Ministry of Foreign Trade and Economic Cooperation (MOFTEC), the Chinese Academy of Sciences and the Beijing Municipal Government. These reports focused on major international cooperation with ADB, UNEP and UNDP, major tasks and measures of China's 10th Five-Year Plan, China's WTO accession, agricultural non-point source pollution and green Olympics in 2008.

  The meeting also reviewed the reports of the Secretary-General, the Working Group coordination meeting and nine working groups and task forces. Participants deliberated on strategies for promoting sustainable development in the new century and the recommendations to the Chinese government. The general recommendations to the Chinese government from the 5th meeting of the 2nd phase of CCICED were adopted.

  On the last day of the meeting, Li Peng, Chairman of the Standing Committee of China's National People's Congress (NPC), met with Chinese and international Council members. Li carefully listened to presentations of four international and Chinese members on the Council recommendations to the government. He expressed thanks for the recommendations given to the Chinese government by CCICED. He said that over the past ten years both international and Chinese members of the CCICED have shown great concerns for China's environment and development, put forward many good proposals for the Chinese government and contributed their wisdom with hard work.

  Li said that many of the CCICED recommendations have been adopted by China's central and local governments and have turned into policies and results that helped push forward China's economic development and the improvement in the ecology. The Chinese government will continue to support the operation of the 3rd phase of CCICED.

  A signing ceremony of the Memorandum of Understanding (MOU) for a third phase of the CCICED took place at the end of the meeting. President Len Good on behalf of CIDA and Mr. Ho Xiaowei on behalf of MOFTEC signed the MOU.

  At the suggestion of Premier Zhu, some Council members made a trip to Gansu Province before the Council meeting. The delegation visited the sites of two projects aimed at environmental rehabilitation through afforestation, water catchment protection and prevention of desertification.


  On Environmental Economics

  The Council recommends that the government should aim:

  to ensure that the users should recover total costs of production and consumption, including those of environmental damage and pollution;

  to accelerate improvements to the current system of pollution levies and the use of other instruments for environmental control: in particular levels of fees and charges should increasingly reflect total costs of environmental damage;

  to develop capacity in all government agencies to understand the implications of environmental damage in policy making, and to develop incentives for public officials;

  to undertake environmental impact assessments applying not only to individual projects, but also, where feasible, to economic policies in general; to use models and scenarios as appropriate to assess possible future developments and their environmental impacts.

  On Sustainable Agriculture 

  The Council recommends that the government should aim

  to reconcile the occasional conflicting roles of government departments over regulation, production and sale of fertilizers and pesticides;

  to raise agricultural efficiency; to promote production of food in certain areas, free of pesticides, chemical fertilizers and genetically modified organisms, for which a market is rapidly developing;

  to increase public awareness, particularly among farmers, of environmental costs of poor agricultural management;

  to establish long-term monitoring and evaluation system for the agricultural environment; and to pay attention to agricultural biodiversity conservation, particularly the species sources of wild crops.

  On Forests and Grassland 

  The Council recommends that the government should aim:

  to conduct a full cost benefit analysis of land conversion and natural forest protection programs, taking into account ecological and socio-economic benefits and costs at every level;

  to put in place long term arrangements for monitoring and evaluation, and supply the necessary funds; to integrate watershed management with particular regard to property rights and use of appropriate technologies (including natural regeneration and the use of appropriate tree species to maximize ecological and economic benefits);

  to reconsider and in some cases relax the current logging ban according to particular circumstances.

  On Biodiversity 

  The Council recommends that the government should aim:

  to improve coordination among the various sectors involved in biodiversity management and conservation;

  to establish guidelines for ensuring conservation and restoration of species and ecosystems as well as biodiversity in different ecological and geographical circumstances;

  to review current regulations for protected areas and their enforcement; and to undertake a national assessment of the status and functioning of ecosystems;

  to establish a national biosecurity programme to cover issues of the invasion of alien species, and those relating to uses of biotechnology. Early ratification of the Cartagena Protocol on Biosafety is highly desirable;

  to develop new incentives for conservation and maintenance of ecosystem services, in full association with local communities;

  to work out integrated policies for biodiversity conservation in the Western Development Strategy.

  On cleaner production and control of pollution 

  The Council recommends that the government should aim:

  to establish special regulatory systems which require local government to integrate cleaner production into local development plans, to bring in the environmental dimension generally, and to assess and monitor performance on a regular basis;

  to encourage private investment;

  to take maximum advantage of recycling materials whenever possible, and in disposing of waste without damage to the environment;

  to pursue current demonstration projects by city and industrial sector, and draw on the experience already gained;

  to conduct further studies on how best to promote cleaner production, and advance work on national legislation on the subject, possibly following the precedent set in Taiyuan.

  On energy 

  The Council recommends that the government should aim:

  to emphasize energy efficiency improvements in all sectors, especially at the point of end use;

  to move away from smoke-generating direct combustion towards such cleaner energy carriers as electricity, gas and steam;

  to evaluate and develop small scale hydro power;

  to develop Chinese resources of wind, solar and biomass (at present very much underused);

  to pursue research into other energy technologies, including nuclear, so that costs and benefits can be more accurately assessed;

  to ensure that environmental costs are taken into account in pricing different forms of energy;

  to encourage foreign direct investment, joint ventures, and private/public partnerships to gain access to capital and advanced technologies;

  to set targets for application of renewable energy technologies, using subsidies as appropriate, to achieve economies of scale, and drawing upon experience in this respect elsewhere.

  On Transport 

  The Council strongly urges:

  Responsibility for different modes of transport should be brought into a single department, which should be responsible for overall policy and planning taking environmental considerations into account throughout.

  Particular importance should be attached to the need for an integrated strategy and procedures for assessment to take account of such issues as development of rail against road transport, especially of freight, the future use and costs of air transport, the rehabilitation of inland waterways, and the full association of the public, including local communities, in future planning.

  Prices of fuel should reflect true environmental cost.

  Strict environmental standards need to be applied to motor vehicles, and best available clean technologies need to be used.

  Smaller more compact cities should be encouraged to have their own sustainable transport arrangements, including the use of bicycles, to decrease the use of motor transport.

  On Trade and Environment 

  The Council recommended that the Chinese government should aim:

  to fully take account of environmental impacts of WTO and consider an integrated assessment of the environmental consequences of WTO accession;

  to play a creative role in establishing a better balance between commercial and environmental considerations in and out of WTO.

  to participate early in the Clean Development Mechanism to help secure substantial foreign investment and transfer of advanced technology to advance sustainable development in China.

  The Council also particularly recalls its previous advice to the government:

  to play a full part in international negotiations on such issues as climate change and sustainable development;

  to review some of its environmental legislation and do more to enforce it;

  to retain the responsibilities of government even when advancing privatisation in some sectors and the use of market forces;

  to bring sustainable development to the attention of ordinary citizens, and bring information about it into the educational process;

  to learn from the mistakes of other countries, protect its unique environment and culture, and make its own distinctive contribution to sustainable development.


  Report on WG Coordination Meeting 

  The WG coordination meeting took place in Beijing on October 12, 2001. The meeting was attended by all seven working groups (WG), two task forces (TF) and a number of Council members. Zhang Kunmin, Secretariat-General of the Council and Earl Drake, Director of the Secretariat Canadian Office, also participated in the meeting.

  Participants focused on issues to be carried over to the third phase of the Council by using the past successful experiences. Zhang noted that the WGs are the corner-stone of the Council, and the Council's recommendations to the Chinese government have been accepted by 17 different government departments and agencies or been considered in their decision-making process.

  In summing up the unique results of the WGs and TFs in the past two phases, Arthur Hanson, chairman of the coordination meeting and a Council member, noted that several WGs have carried out 'horizontal dialogue' across various relevant governmental departments, some have found pathways (such as combining technology, policy innovation and feasibility identification) to meet multiple objectives. They have addressed new emerging topics such as WTO accession, Clean Development Mechanism (CDM) and biosafety. They have also applied new analytical techniques in their work. These include advanced scenario and modeling carbon dioxide, energy feasibility, comprehensive policy assessment, environmental tax modeling by using CGE, etc.

  WGs represent high value and unique quality of CCICED work and operations. These include building a network of worldwide experts representing best people in the world; linking their inputs to highest decision-making levels; and reaching not only central but also local decision-makers. They have also undertaken transformative thinking and action in their work over the past decade.

  Participants identified a number of opportunities for improving the Council in its third phase. They noted that the Council needs continuity to attract the best people and build quality working relationships. There is also a need to use expertise across themes. In selecting future TFs, there is a need for standing commitment to some key areas and capacity for rapid response. Case-by-case decisions are more appropriate for each topic area.

  The meeting also suggested new roles for Council members and the secretariat offices. It was suggested that the members should be more directly involved with individual WGs or TFs; assist in developing relations with Chinese departments; use results more effectively for Council recommendations; and act as "champion" from start to finish.

  The secretariats were asked to extract key messages from research; provide overview and synthesis of current emerging issues; and coordinate among activities. They should also effectively communicate and disseminate results of WGs and TFs, and support development of new agenda, with timely guidance for WGs and TFs.

  Co-chairs expressed their thanks to all their WG members for their dedicated efforts and hoped that the existing solid foundation will contribute to the success of Phase III. Vice-Chairs of the Council Minister Xie and President Good also came to the meeting expressing their gratitude to all the WGs and TFs for their contribution to the Council.


  Special Enforcement Inspection Yield Remarkable Results 

  The State Environmental Protection Administration recently announced that the special environmental enforcement inspection campaign had yielded remarkable results. Between May and early September, ten inspection groups were dispatched to 12 provinces to inspect environmental enforcement and investigate environmental violation. It involved a total of 381,430 enforcement staff to visit relevant sites. A total of 142,121 enterprises were inspected, of which 2,435 were found to have returned to their illegal emissions after the national cut-off time for attaining the national emission standards and 1,283 were ordered to shut down for clean-up. A total of 4,937 enterprises were imposed fines and 418 persons were held responsibility for the violations. SEPA publicly published the names of the 10 worst violators nationwide. These violations mainly involved illegal logging which resulted in serious forest destruction, and illegal emissions after the national cut-off date for clean-up. The special environmental enforcement inspection campaign was launched by the State Environmental Protection Administration, State Economic and Trade Commission, the Minister of Supervision and the State Administration of Forestry.

  China Promotes Eco-Tourism 

  In the coming year, China will step up promotion of eco-tourism. A recent measure taken is to grade tourist attraction sites. One hundred and eighty-seven tourist attraction sites have been listed as 4A class, a level which means perfect environmental quality.

  China has attached great importance to environmental protection in tourism and ensure that both tourist resources and ecological environment develop simultaneously and maintain sustainability. China designated 1999 as a year of eco-environmental tourism and has developed a series of ecologically-oriented tours and hotels. China has now established a special fund for the development of tourist resources and the protection of the natural environment in Central and Western China. (China Environment News, 12/03/2001)

  China to Continue Major Afforestation Project 

  The State Administration of Forestry and the State Planning and Development Commission have recently announced that China will launch its fourth phase of the afforestation project in North, Northeast and Northwest China. The project covers 590 counties in 13 provinces and autonomous regions. It is expected that 9.5 million hectares of land will be forested by 2010. The acreage of forestry will grow by 1.84% and a fairly complete system of regional forest protective belts will be established, initially covering ecologically deteriorating spots in the area.

  China's overall afforestation project started in 1978 and will be concluded in 2050, spanning 73 years and having eight phases in three stages. It is expected that a total of 35.083 million hectares of land will be forested. (China Environment News, 11/26/2001)

  Auto Makers Benefit from Tax Reduction 

  According to the State Environmental Protection Administration, three Shanghai auto makers will benefit from a 30% cut of the car consumption tax because the cars manufactured by them meet the European II standard in the exhaust emission system. These three auto makers are Shanghai GM Co., Shanghai Volkswagen Co. and Shenlong Co.

  This is the first ever government financial policy to encourage enterprises and products to attain advanced environmental standards. The new rules will cut the car consumption tax for cars that are environmentally friendly with a low pollution emission.

  A panel of experts from SEPA, the State Economic and Trade Commission and the State General Administration of Taxation inspected and examined the cars manufactured by these three companies in September. It is expected that these three companies will benefit from a tax relief of 1.5 billion yuan in the fiscal year of 2000-2001. (China Environment News, 11/26/2001)

  China to Launch Major Water Diversion Project 

  China will launch a major project to divert the water of the Yangtze River to its northern area, a senior official of the Ministry of Water Conservancy announced in early November. This man-diverted water course will be built through eastern and central China and expected to be completed in six to seven years.

  The project is expected to considerably improve the natural conditions and water shortage in northern China. It will promote strategic economic restructuring, stimulating domestic demand and expanding employment in China. The new operation practices of the project will require water recipient areas to pay greater attention to water economy and pollution control and to steadily improve the eco-environment in the Yellow River, the Huaihe River and the Haihe River basins. The key project lies in pollution control in the eastern line as the lakes and rivers in the area are currently seriously polluted. The aim is to make water reach the state-prescribed third class standards by building clear water channels and water supply guarantee and quality improvement projects. The project raised serious debates and underwent a long-standing feasibility study before the final decision. (China Environment News, 11/19/2001)

  China Eliminates Approval Procedures for Investment 

  The State Planning and Development Commission has recently announced that the approval procedures for five categories of investment will be eliminated. The five categories cover urban infrastructure projects such as urban water supply system, urban sewage and garbage disposal, urban gas supply facilities, urban central heating facilities and urban roads, bridges and tunnels. They also cover projects in the areas of agriculture, animal husbandry, fisheries, farm produce procession, forest and water conservancy projects. (China Environment News, 11/19/2001)

  Environmental Science Development in the Tenth Five-Year Plan 

  The State Environmental Protection Administration (SEPA) has adopted the Guidelines for Environmental Science Development in the Tenth Five-Year Plan Period (2001-2005). The Guidelines identify 49 topics in eight areas as key projects for environmental science development in the five years. These eight areas are: research on environmental and sustainable development policies, laws, regulations, standards and management approaches that meet the need of the new century; studies on toxic chemicals and pollution prevention; research on management of cleaner production, maximization of research utilization and minimization of pollution and wastes; theoretical research and demonstration on eco-industry and eco-design; R&D in the environmental industry to promote advanced environmental technology and products; research on ecological and environmental science; studies on nuclear safety and radiation safety technology; and research on global environmental issues including climate change, biodiversity, ozone depletion, trade and environment and environmental diplomacy.

  Pilot Emission Trading in Nantong 

  The first ever CO2 emission trading transaction was made between two firms in Nantong, Jiangsu Province. This is part of the joint China-US project that employs market forces to control the emission of sulfur dioxide. The Nantong Tianshenggang Electrical Power Generation Company sold its right of emission of 1,800 tons of sulfur dioxide to a large chemical works for a six-year long period. A signing ceremony was held recently in Nantong, Jiangsu Province. The payment will be settled annually at a transfer rate of 300 tons a year. According to the contract, the buyer may sublet its emission right if it has quotas to spare or use it by itself. (China Environment News, 11/12/2001)

  Hongze Lake Unnavigable 

  Hongze Lake in Jiangsu Province, one of China's four major lakes, continually drops its water table and becomes unnavigable this year due to persistent drought and insufficiency of water supply from the Huaihe River in the upper reaches. The Lake's water table dropped twice in the second quarter of this year, a phenomenon never seen in history. Since September, the average rainfall in Jiangsu Province has been less than 15 millimeters, 90% less than in regular years and 60% less than in 1978, a year of major drought. It was the least rainfall value since 1949.

  The Lake's capacity is now but in several hundred million cubic meters and the water table is dropping continually at a daily speed of two centimeters. The navigation in the western part of the Lake and fisheries have all stopped. (China Environment News, 11/05/2001)

  Shangdong Shut Down Straw Pulp Production Lines 

  The Government of Shandong in east China decides to suspend 41 straw pulp production lines with an annual output of lower than 20,000 tons from October of this year to end-August of next year.

  The straw pulp papermaking mills in the province produced 278 million tons of wastewater and 177,000 tons of COD in 2000, accounting for 25.2% of the total amount of wastewater and 34.6% of total COD emission of the province. These mills are small and have a raw material structure that is irrational. They can hardly cope with their pollution. Of the 78 straw pulp papermaking mills, only 17 have soda ash recovery facilities operating properly. It has been estimated that 44,000 tons less of COD will be discharged annually and 29 rivers will improve their water quality as a result of the shut-down. There will be no more new straw pulp papermaking firms established in the province. (China Environment News, 11/12/2001)

  Fujian to Commercialize Urban Sewage Plants 

  Fujian has recently issued the temporary rules to promote the commercialization of urban sewage plants. Market mechanisms will be introduced in the investment, construction and operation of the province's urban sewage plants and ultimately to commercialize these facilities. Although the government will still be the main investor to the urban sewage plants, the operation of them will be commercialized.

  Investment and operations of these sewage plants will be open to tenders and all plants will be independent legal entities as in a market economy. Its operational right may be transferred and its assets may be auctioned. Enterprises are encouraged to contract independently or jointly the operations of the existing urban sewage plants and the successful bidders have the right to re-organize the staff.

  The government will take steps to reform water pricing. The charge for using sewage treatment services will become an important part of water pricing. The sewage charges will be under the control of a special fund for the instruction, operation and maintenance of sewage plants.

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