Environmental issues still burn strong and the robust growth may thwart efforts to cut energy use and pollution
CHINA HAS GOOD cause for celebration. The mainland economy grew 10.9 per cent year on year in the first half, with all 31 provinces and municipalities registering double-digit growth and 23 reaching 12 per cent or more, statistics show.
China's foreign reserves have soared to almost US$1 trillion from less than US$200 billion five years ago. The country's trade surplus grew to a record US$18.8 billion in August, which brings the surplus for the year so far to US$95 billion. And the mainland has been estimated to attract US$100 billion a year in combined portfolio and direct investments between now and 2010.
While many hailed the figures as a sign of the mainland's economic power, others, including President Hu Jintao, said the breakneck growth, largely thanks to excessive investment in fixed assets, had become a cause for concern.
Such concern is supported by the central government's calculation of the environmental cost of the economic growth, commonly known as green GDP, which has received endorsement from the country's top leaders. The partial finding, which heavily underestimated the actual situation, put the cost of pollution at about 3 per cent of GDP in 2004, or 511.8 billion yuan, according to the country's top green watchdog.
Deputy director of the State Environmental Protection Administration (Sepa) Pan Yue said: 'While China's GDP has risen at an annual rate of 8 to 12 per cent since the nation embarked on opening up and reform in the late 1970s, environmental damage has eaten away between 8 and 13 per cent of that GDP growth every year.'
