Will the Sun Shine on China Miracle? China Is Booming and 400,000 Premature Deaths Are Put Down to Air Pollution. Special Correspondent Lindsay Beck Investigates the Environmental Impact of the New Industrial Revolution

Article excerpt

Byline: Lindsay Beck

There are days in Beijing when the smog is so thick residents can stare straight at the sun.

Residents of the 2008 Olympic Games host city watch the air quality index like they do the weather forecast.

Some Chinese cities may dazzle with gleaming skyscrapers and some rural backwaters have been transformed into industrial hubs, but more than two decades of 9.5 per cent annual growth have come at a cost.

Now the country is trying to calculate exactly what price it is paying for choking smog, poisoned rivers and toxic waste, floating the concept of a "Green GDP" index likely to be debated at the annual parliament session that convenes on March 5.

Pan Yue, deputy chief of China's environment body and its most outspoken green crusader, said: "Green GDP deducts ecological and environmental losses. It is able to more fully test and measure the quality of economic development and avoid false achievements."

It's an idea that fits with the model of development that the leadership under President Hu Jintao and Premier Wen Jiabao has been trying to project, one of tempering the pace of economic growth with a focus on balanced growth.

The changes are likely to be tough to implement.

Local leaders are accustomed to being judged on growth above all else and would be fearful that stricter environmental controls would impact on their bottom line.

A first step, analysts say, is establishing a system of green accounting to get a more accurate idea of the costs associated with the issues.

Pan Yue said: "It is evident to any thinking person that things need to be changed. What is not clear is what strategy to use."

A number of pilot projects are under way to test green accounting systems, but there are a whole series of instruments that could be adjusted if a complete green GDP system were adopted, including pricing systems and natural resource taxes.

While Green GDP is an idea popular with top leaders trying to keep a growing gap between rich and poor in check and counter social instability, it is also likely to be less appealing to local officials after investment dollars and tax revenues. The government is trying to change that, with wide-ranging regulations that aim to integrate environmental losses into the measurement of regional development - and into the evaluation of local officials. …