An Upside to China's Slump: Cleaner Air

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A resident rides a bicycle past a chemical factory in China's Hubei province on Feb. 25, 2009

Of all the things China has sacrificed to economic growth — communist ideology, traditional architecture, guaranteed employment — the erosion of the country's environment may have the highest cost. China's industrial zones are wastelands of polluted soil and water; the air in major cities is often unfit to breathe because demand for electricity by the country's export machine has forced coal-fired power plants to work overtime, spewing particulates into the atmosphere around the clock.

This is why environmentalists can easily see an upside to China's economic slump: cleaner air. Global recession has thrown a wrench into the country's export machine. The government announced yesterday that exports fell last month a staggering 25.7% compared with the same month last year. Declining along with industrial production is power consumption, which skidded 9.6% in November and 7.9% in December. Couple that with efforts to clean up the environment for the 2008 Olympics, and the country's total level of air pollution last year was slightly lower than in the year previous, according to China's Environmental Monitoring Center. (Read how China can get its boom back.)

Environmentalists suspect that those bluer skies may not last, however. Yes, the government is emphasizing improving energy efficiency and reducing emissions as part of its efforts to maintain economic momentum. China's $586 billion stimulus package includes $30 billion for antipollution and power-saving measures. Environmental protection "cannot be taken lightly," Premier Wen Jiabao declared on March 5 during his annual work report, China's equivalent of the U.S. President's State of the Union speech.

But green groups are wary that severe economic strains may once again render the environment an afterthought. Friends of Nature, one of China's first environmental groups, outlined its concerns this week in a statement addressed to the National People's Congress and the China People's Political Consultative Conference, which are meeting in Beijing this week. "In order to guarantee good, fast economic development, a few high-pollution, high-energy-consumption, high-risk projects should not be snuck into" the government's investment goals, the group said.

At issue is what Charles R. McElwee, a Shanghai-based environmental lawyer, calls the "schizophrenic" nature of China's stimulus spending. While the measures emphasize environmental protection, the list of industries that Beijing says it plans to help include polluters such as steel manufacturers, the auto industry and petrochemicals. "Although there will be some lip service paid to using the stimulus to move to a more service-oriented economy, I think the reality is that the old, tried-and-true employers, the heavy industries ... will reap the most benefits," says McElwee.

The government has pledged to create 9 million jobs in urban areas this year, and it has only nine months left to make that happen. Boosting the country's existing automakers could mean immediate employment growth, while funding research into electric vehicles might only mean gains years down the road. "We are literally running against time," says Wu Changhua, China director for the Climate Group, a London-based environmental NGO. "Money will be put in place quickly and all kinds of programs started. How effective will the controls be in real life? That's a big question mark."

While China has been praised for the speed with which it has acted to revive its economy, a lack of details about its stimulus measures has drawn complaints at home and abroad. Environmentalists say that without knowing how the money will be spent, they can't spot potentially adverse impacts. "We need more transparency, more information," says Sze Pang Cheung of Greenpeace China. "Let's hope this information will come, because this is an important issue. It's really a test case for China and whether it's serious about the environment, whether it's serious about sustainable development and whether it has an effective government structure to make sure it happens."

There are signs the status quo may be returning more quickly than expected. The government announced this week that power consumption grew 4% in February, the first rise in three months. But green groups can take some consolation that leaders are at least linking environmental protection with commercial growth. During the last major shock to the Chinese economy — the 1997 Asian financial crisis — preserving the country's air and water was not a major priority. "Back then, the awareness was not there," says Wu. "Economic security was the No. 1 priority. As a result, the government didn't pay enough attention. That's exactly why we ended up where we are today."

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