China sees opportunities as well as dangers in climate change 全球气候变化带给中国的机遇与威胁

UNLIKE America’s leaders, China’s bosses are not much troubled by recalcitrant legislatures. The government has therefore had no difficulty in executing a smart volte face on climate change. Around three years ago its fierce resistance to the notion of any limit on its greenhouse-gas emissions started to soften. It now seems to be making serious efforts to control them.

One reason for this change is the country’s growing awareness of its vulnerability to a warming world. The monsoon seems to be weakening, travelling less far inland and dumping its rainfall on the coasts. As a result China is seeing floods in the south-east and droughts in the north-west. At the same time the country’s leaders are deeply concerned about the melting of the glaciers on the Tibetan plateau, which feed not just the Ganges, the Indus, the Brahmaputra and the Mekong but also the Yangzi and Yellow rivers (see map).

A second reason is China’s growing sense of global responsibility. The country is not only the world’s largest emitter of greenhouse gases; it now regards itself, and is regarded, as one of the world’s leading powers, and therefore expects to work with the other big powers to tackle global problems such as the economic crisis, nuclear proliferation and climate change.

A third reason is energy security. Although China has large coal reserves, it is also a big importer. Concerns about excessive dependence on foreign fossil fuels sharpened when China’s oil imports rocketed and, in 2005, the attempt by CNOOC, China’s largest offshore oil and gas company, to buy America’s Unocal was rebuffed. China’s push into nuclear and renewable energy has been driven by its need to diversify its energy sources.

The fourth reason is economic. The Kyoto protocol has given China an incentive to clean up its act. China has received $2 billion through the CDM for cleaning up its industrial processes and building clean-energy capacity—half the money that has flowed through the CDM. That is expected to rise to $8 billion by 2012.

But a longer-term economic motive springs from a shift in the way China thinks about growth. In the past, its all-out drive for growth has led it to rebuff pressure to cut emissions. Attempts to control pollution foundered on the performance-assessment system for officials at all levels of government, which prioritises growth. But that has been adjusted to encourage energy efficiency, and at the same time the leadership has started to argue that growth and greenery are compatible.

Since Wen Jiabao took over as prime minister, the leadership has tried to define economic growth as something broader and longer-term than GDP figures imply: the emphasis has been on a “harmonious society” and “scientific development”. Nobody was sure what the latter meant, but Mr Wen has recently been talking about a more “resource-efficient environmentally friendly society” and Hu Jintao, the president, has referred several times to a “low-carbon economy” and a “green economy”.

Local pollution may help to explain the shift. Residents are infuriated by filthy air and water that kills people and damages unborn children. Policies to cut carbon-dioxide emissions—through reducing the energy used to produce goods—can help clean up China’s cities at the same time.

More interesting is the idea that clean energy might be a source of growth rather than a constraint on it. China, so the argument goes, missed out on the computer revolution. It makes hardware, but American firms own most of the valuable stuff—the intellectual property for the software. “You can’t get rich making socks and toys,” explains Lin Jiang, director of the China Sustainable Energy Programme at the Energy Foundation in San Francisco. “They’re looking for the next growth industry. Clean energy clearly has huge potential. And no country dominates the industry yet. It’s a wide-open field.” Hu Angang, an economist at Tsinghua University, calls this “a huge opportunity for China. The country will become the largest renewable-energy market, bio-energy market, clean-coal market, nuclear-power market, carbon-exchange market, environmental-technology market, low-carbon economy, exporter of low-carbon products and low-carbon-technology innovator.”

The government is giving the economy a shove in that direction. In 2006 the five-year plan set a target for a 20% cut in the energy intensity of GDP by the end of 2010. The start was slow, but by the end of last year it had managed 10% and it now looks on track for its target. According to Mr Lin, that would mean a reduction in carbon emissions of 1.5 billion tonnes per year by 2010, more than the Waxman-Markey bill’s caps for domestic industry would take out of America’s economy by 2020. China has relatively tight vehicle fuel-efficiency standards (see chart 5). Electric vehicles are being generously subsidised ($8,800 for a car and $73,500 for a bus) and the government plans to build the capacity to produce half a million a year by 2012.

The most visible changes have come in renewable energy. In 2005 the National People’s Congress passed legislation to offer subsidies for renewable energy—around twice the amount for coal. For wind energy, the target was set at 20GW of capacity by 2020. The subsidy generated so much building that China now expects to hit that target by the end of this year and is aiming for 150GW by 2020. “It’s like a gold rush right now,” says Mr Lin. The target for solar energy, similarly, has been raised from 1.8GW to 20GW by 2020.

To put this in context, wind currently generates only 0.4% of Chinese electricity. Coal generates 80%. And, although China’s government does not have to jump the legislative hurdles faced by America’s president, it sometimes struggles to get policy implemented on the ground. Yet if China’s many layers of government can be persuaded that green means growth, they will cleave to this policy; and the leadership seems keen to make that happen.

China, thus, is after the same “green jobs” that Americans have been promised as part of their road to economic recovery. America has huge advantages in terms of technology and capital, but China has a couple of things going for it too: cheaper labour and a leadership unconstrained by the need to get re-elected every four years. China can play a long game, which helps when dealing with climate change.