OECDWORKINGPARTYONENVIRONMENTALPERFORMANCEENVIRONMENTALPERFORMANCEREVIEWOFCHINACONCLUSIONSANDRECOMMENDATIONS(FINAL)TheseConclusionsandRecommendationshavebeenapprovedbyalltheDelegationsoftheOECDWorkingPartyonEnvironmentalPerformance,includingtheChineseDelegation,atitsmeeting(Beijing,8-9November2006).2CONCLUSIONSANDRECOMMENDATIONSSincethelaunchofthe“opendoor”policyin1978,economicgrowthhasbeenremarkable.Overthelast15years,theaveragerateofeconomicgrowthhasbeen10.1%peryear.Chinanowhasthefourthlargesteconomyintheworld.Largeforeigndirectinvestmentandtheincreasedroleofmarketforceshavefacilitatedthecountry’sintegrationintotheglobaleconomy.Intheprocess,largenumbersofpeoplehaveescapedextremepoverty.However,whileChinahasabout20%oftheworld’spopulation,GDPpercapitaisstilllow(USD6000forChinacomparedtoUSD25000forOECDcountriesatPPP2000)andisunevenlydistributedacrossthecountry,withwealthiercoastalprovincesandless-developedwesternprovinces.Largemigrationshavecontributedtorapidurbanisation(now43%ofthepopulation),andincomedisparitybetweenurbanandruralareashasincreased.PovertyremainsaseriouschallengeinruralChina.Thisrapideconomicgrowth,industrialisationandurbanisationhavegeneratedhighpressuresontheenvironment,withconsequentdamagetohealthandnaturalresources.Chineseauthorities,awareofthedeteriorationoftheenvironment,arepromotingmorebalancedpatternsofdevelopment,usingconceptssuchas“harmonioussociety”and“scientificdevelopment”.Theirresponseshaveincludedplanningfornationaleconomicandsocialdevelopment(coveringenvironmentalmanagementefforts),modernenvironmentallegislation,strengthenedenvironmentalinstitutions,andhigherprioritytoenvironmentalandnaturalresourcesmanagement.Nevertheless,airpollutioninsomeChinesecitiesreacheslevelsthatareamongtheworstintheworld,energyintensityisabout20%higherthantheOECDaverage,andaboutathirdofthewatercoursesareseverelypolluted.Challengeswithwastemanagement,desertification,andnatureandbiodiversityprotectionremain.Toachieveaneweconomicandsocialdevelopmentmodel(aresourcesavingandenvironmentallyfriendlysocietyaccordingtothe11thFYP),Chinawillneedtoi)strengthentheeffectivenessandefficiencyoftheimplementationofitsenvironmentalpolicies;andii)enhancetheintegrationofenvironmentalconcernsintoeconomicdecisions(e.g.fiscal,energy,agriculture,transportandland-usedecisions).EnvironmentalissuesinChinahaveoftenastronginternationaldimension,reflectingregionalenvironmentalinterdependencies(e.g.transboundaryairandwaterissues,regionalseaspollution,desertification)andglobaleconomicandenvironmentalinterdependencies.TheenvironmentalpressuresanddemandforenergyandotherresourcesassociatedwithChina’srapideconomicdevelopmentdramaticallyunderlinesquestionsabouttheenvironmentalsustainabilityofcurrentproductionandconsumptionpatternsglobally.Tradeaswellasfinancingofdevelopment(e.g.officialdevelopmentassistance,foreigndirectinvestment)haveimportantenvironmentaldimensions.ChinathereforehasasharedinterestwithOECDandothercountriestoaddressrelatedchallenges,andhassignificantlyenhanceditsengagementininternationalenvironmentalco-operationinrecentyears.ThisreportexaminesprogressmadebyChinasince1990andevaluatestheextenttowhichthecountry’sdomesticobjectivesandinternationalcommitmentsarebeingmet.Some51recommendationsaremadethatcouldhelpstrengthenChina'senvironmentalperformanceinthecontextofsustainabledevelopment.31.EnvironmentalManagement1.1ImplementingenvironmentalpoliciesmoreeffectivelyandefficientlyChina’scomprehensiveandmodernsetofenvironmentallaws,togetherwithitssuccessiveFive-YearPlansforNationalEconomicandSocialDevelopment(FYPs)andFive-YearEnvironmentalPlans(FYEPs),provideahigh-qualityframeworkforpursuingsustainabledevelopmentandenvironmentalprogress.InDecember2005,theStateCouncilissuedadecisionforbetterimplementingenvironmentalpolicies.InApril2006,theChinesePremierannounced,inthesixthnationalenvironmentalprotectionmeeting,threenewpolicydirections,including:integratingenvironmentalprotectionandeconomicdecision-makingonanequalfooting,furtherdecouplingpollutantemissionsfromeconomicgrowth,applyingamixofinstrumentstoresolveenvironmentalproblems.Theproposeddirectionsandmeasuresarebeingimplementedandgoalongwaytowardsaddressingtheenvironmentalpolicyimplementationgap.Withintheirmandates,departmentsundertheStateCouncilhaveworkedhardtosupportenvironmentalpolicyimplementation.Arangeofregulatoryandeconomicinstruments(e.g.pollutioncharges,usercharges,emissionstrading)andpolicyapproachesthatharnessmarketsandpublicinterestintheenvironmenthavebeendeveloped.Campaignsandawardschemestosupportimplementationatthelocallevelhavebeenorganised;workwithnon-governmentalorganisations(NGOs)todevelopproceduresforpublicparticipationinenvironmentalimpactassessment(EIA)isanimportantrecentexample.Thereisevidencethatlocalleadersinsomeofthericherprovincesarerespondingtodemandsfromthepublicforbetterenvironmentalconditions,andarerecognisingthebenefitstotheeconomyandthesociety.Morethan8000companiesareregisteredunderISO14000.In2004,pollutionabatementandcontrol(PAC)investmentexpenditu