Women in China

Introduction

Modern older women workers (shutterstock_108277505)

Since the founding of the People’s Republic of China in 1949, promoting greater equality between men and women has been a stated goal of the Chinese Communist Party (CCP). Mao Zedong famously proclaimed “In China, women hold up half the sky.” By this Mao appears to have meant that, if women were treated equally to men, China could better achieve its potential by taking advantage of the full complement of its population and workforce. The CCP thus supported the promotion of equal rights in all aspects of a woman’s life, at least at a rhetorical level.

Yet, even from its earliest days pre-dating the founding of the PRC, the support of Chinese women’s rights has been less about a woman’s potential to realize herself as an individual, and more about ways to use women’s emancipation as a tool to achieve national objectives. Before the revolution, the mainly male voices which advocated changing the traditionally subservient role of Chinese women did so in the belief that educated, more capable Chinese women would better be able to raise intelligent, morally sound sons. These sons could then build a strong China that could defend itself from foreign imperialism.

Despite CCP proclamations, a long historical tradition of male dominance and patriarchal authority has been deeply embedded in China’s culture since dynastic times. The CCP’s rise to power brought radical changes to Chinese society; but this traditional male dominance in both the work and social spheres has proven difficult to overturn, despite the real progress that Chinese women have made in obtaining the right to be educated, to work, to choose whom they marry, to divorce, to own and inherit property and to participate in political affairs. On the one hand, the profound changes that economic reform has brought to China have brought unprecedented opportunities to Chinese women; for instance, China has more self-made female billionaires than any other country. On the other hand, the government’s commitment to fight women’s inequality has taken a backseat to its desire to promote economic growth. As a result, in many ways, there has been a return to traditional gender expectations which have hampered the progress of Chinese women’s emancipation.

Women Under China’s Dynasties – Confucianism and Women

China’s deep roots of discrimination against women lie within its ancient Confucian traditions. The Confucian system, whose origins lie in the 551-479 BC period, encompassed the notion of “filial piety” – that women should obey men, citizens should obey their ruler, and the young should obey the elderly. For a woman, this meant that she was expected to be absolutely dutiful to her father, husband and sons.

Confucian tenets reinforced the moral justification of this strict regulation of gender. Confucians writers believed that the base elements of universe, yin and yang, were comparable to the state of marriage between woman and man. Woman was the yielding, passive, enduring, submissive feminine yin opposite the hard, aggressive, active masculine yang. By conceptualizing the differences between man and woman as yin and yang, Chinese intellectuals cast the differences, and the social hierarchy that resulted from them, as part of the universe’s natural order. In this way, men’s dominance of women was perceived to be not a social convention, but a natural law. Confucian intellectuals believed that, while yin and yang were complementary forces, they were not strictly equal. Just as the yang force dominated the yin, Confucian scholars believed that it was right for Chinese society to be patriarchal, and that a woman’s place was naturally in the home acting in support of her husband. This was expressed in Confucianism as “Threefold Obedience” – an unmarried women must obey her father; a wife must obey her husband; a widow must obey her adult sons.

Even those women who gained influence, such as the Confucian scholar Ban Zhao (45-116 AD) who worked as a royal advisor to the Empress and as a literary scholar, helped to uphold the status quo. In her influential Lessons for Women, Ban Zhao encouraged women to modestly yield to others and to put others first. Ban Zhao said that a woman had seven virtues to master: humility, resignation, subservience, self-abasement, obedience, cleanliness, and industry.

Marriage in Dynastic Times

Traditionally in China, a woman was betrothed at a young age. Her husband was selected by her parents, then aided by a matchmaker and by senior female relatives in the family. The goal was to find a husband that would benefit the daughter’s family either socially or economically. A woman often did not meet her husband until her wedding day. Once married, a woman was sent to live with her husband’s family. Traditionally, living with her husband meant that she gave up the protection and care of her natal family. This caused a profound sense of loss – not only the loss of the relationships that had previously been her whole world, but also the loss of her previous identity and status. Effectively, she became a possession of her husband and his family. From the time of her marriage onward, she would see her own family infrequently, if at all. Once in the husband’s house, she was to submit entirely first to her husband and his male relatives, then to her mother-in-law. She worshiped her husband’s family ancestors, rather than her own. The daughter’s contribution thus primarily benefited her husband’s family and not the family of her mother and father.

A husband could take multiple wives. These wives were arranged into a hierarchy, its order determined by factors such as order of the marriages, the birth of male sons, a woman’s beauty and how much the husband liked her. Men could divorce on grounds such as barrenness, jealousy, and talkativeness, but could only do so if there was a family to which the wife could return. There were no grounds on which a woman could divorce her husband. Men could also sell women as if they were property.

A Woman’s Life in Imperial China

Both as children and adults, women were restricted almost entirely to the domestic sphere, and were mainly uneducated. In books such as the Confucian classic, Book of Rites, the importance of physically separating the world of men and women was stressed to ensure that yin did not dominate yang. Even houses were to be divided into an inner and an outer section, with the women staying in the inner part. To the extent that women were educated, their learning was for the sole purpose of helping them better educate their sons.

Women were completely dependent on men due to their lack of property and inheritance rights and to their inability to earn an income. This dependence on men created an environment where wife-beating and female infanticide was often overlooked and where a woman who bore daughters was not valued, as only men stayed in the natal family. This preference for boys was reinforced by Confucius’ teachings. Confucius’ follower, Menicus, said that the worst of the unfilial acts was to fail to have boys to continue the line of one’s ancestors.

That said, a woman in pre-modern China did have some influence, although that influence was not hers by right but delegated to her by men and circumstance. For example, besides domestic chores such as cooking, cleaning and childcare, a woman might contribute to household income by working at jobs such as spinning cloth, shucking oysters and processing tea which created real earnings that could gain her favor within the family. Moreover, her role in arranging marriages was important in building alliances that could strengthen the family fortunes. As she bore sons, a woman’s position within the family rose. She became even more powerful when she had a daughter-in-law under her control. She became most powerful in old age, particularly if she had both sons and daughter-in-laws, since she was then respected both as a producer of men and as an elder. At the imperial court, when a young emperor inherited the throne, his mother, as Empress Dowager, could exert power on his behalf until he came of age, or support him behind the scenes until he grew old enough to rebuff her influence. Chinese men nevertheless regarded a woman in power as unnatural and associated her with intrigue, manipulation, and selfishness.

The isolation a woman could feel in her husband’s home was offset in some regions by the practice of taking “sworn sisters”. In Hunan, for example, women could organize themselves into groups of seven friends -– sworn sisters -– who would then provide friendship and comfort to each other throughout their lives. The sworn sisters often developed a secret language and system of writing which enabled them to communicate safely, even when expressing discontent with their circumstances.

Foot Binding

Girl with bound feet c19th century (girlboundfeetc19th) http://visualisingchina.net/#hpc-ch-s01

An important symbol of a woman’s subservience was the practice of foot-binding which endured for over a thousand years. Foot-binding began in the tenth century when an emperor decreed small feet to be a most desirable aesthetic of female beauty. The custom began first with the Chinese gentry and then spread to the general population as families jockeyed to ensure that their daughters married into a family of higher class. In foot-binding, at the age of five or six, a girl would have her toes forcibly bent under the soles of her feet and bound permanently by tight cloth. Eventually the arch of the foot would break, and the tight cloth stopped the feet from growing. The ideal was to create a foot approximately 3 to 4 inches (around 8 to 10 centimeters) long by the time the girl became a woman. The deformed feet caused a woman to walk in a tentative, painful gait that Chinese men found alluring; the deformed feet were also considered to be very erotic. The impaired movement of the bound feet helped restrict a woman to her home which in turn increased her dependence on her husband.

Lisa See, in her novel, Snow Flower and the Secret Fan, imagines poignantly what it must have been like emotionally for women trying to make their life in such a circumscribed and difficult environment:

“We women are expected to love our children as soon as they leave our bodies, but who among us has not felt disappointment at the sight of a daughter or felt the dark gloom that settles upon the mind even when holding her precious son, if he does nothing but cry and make our mother-in-law look at you as though your milk were sour? We may love our daughters with all our hearts, but we must train them through pain. We love our sons most of all, but we can never be a part of their world, the outer realm of men. We are expected to love our husbands from the day of Contracting a Kin, but we will not see their faces for another six years. We are told to love our in-laws, but we entered those families as strangers, as the lowest person in the household, just one step on the ladder above the servant. We are ordered to love and honor our husband’s ancestors, so we perform the proper duties, even if our hearts quietly call out gratitude to our natal ancestors. We love our parents because they take care of us, but we are considered worthless branches of the family tree. We drain the family resources. We are raised by one family for another. As happy as we are in our natal families, we all know that parting is inevitable. So, we love our families, but we understand that this love will end in the sadness of departure. All these types of love come out of duty, respect, and gratitude. Most of them, as women in my country know, are sources of sadness, rupture, and brutality.”

Encounters with the West Expose 19th Century China to New Ideas on Women

Female rural workers, 1920s (femaleworkers1920s) http://visualisingchina.net/#hpc-ar03-062

As the West began to encroach on China in the nineteenth century Chinese leaders and intellectuals began to search for ways to modernize and strengthen China so that it could free itself from encroachment by foreign powers. A woman’s role in society was increasingly scrutinized by intellectuals, especially those who had been exposed to western ideas. Some of these new ideas came from western missionaries working in China. The Christian missionaries taught that the way a society treated its women was indicative of its level of civilized development. Following from this idea, Chinese reformers began to think of the status of Chinese women as symbolic of all that was wrong with the country. They began to argue that improving the lot of women would be one road towards modernizing China. Educated and capable women could better run households and could better raise intelligent, morally-sound sons. These sons could then undertake the task of building a new China. By the end of the Qing Dynasty, foot binding began to be opposed as an example of China’s backward thinking and it was banned by the Republican government in 1912, although it was not fully wiped out until the 1949 Communists Revolution. It was also banned in Taiwan by the Japanese occupying administration in 1915. Most intellectuals supporting women’s emancipation at this time were men, although there were some exceptions. In 1904, for instance, women’s advocate Qiu Jin escaped from her marriage to a wealthy husband and took flight to Japan where she called on Chinese women to fight against their subservient status. Qiu Jin believed that Chinese women led a life tantamount to slavery and believed that women should be given a chance to work outside the home. With their own money, women could break free from their dependence on men and their families.

May 4th Feminist Thinkers

Re-evaluating a woman’s role in society took on renewed momentum during the May 4th Movement of 1919 in which student protests led to a larger examination of China’s society and its government. Known as the May Fourth Feminism Movement, its discourse continued to be driven by male Chinese nationalism. The movement was less about a woman’s potential to realize herself as an individual, and more about ways to change China’s society to save China from western and Japanese Imperialism. That said, during the May 4th Movement, some urban women marched with men in organized political demonstrations and, to a limited extent, engaged in public affairs.

By contrast, engagement with Western scientific discourse persuaded many Chinese male intellectuals to believe in a biological determinist approach of the understanding of gender. While not necessarily a re-play of the theories of yin and yang, biological determinism stated that gender roles were the result of biological differences between men and women. Gender hierarchy was thus natural: since women bore children, they should have the predominant responsibility for housework and the care of family members. This biological determinist understanding was reflected in attitudes and policies adopted both in the Mao and post-Mao eras.

The 1949 Communist Revolution and Marxist Theory on Women

At first, the nascent women’s movement was restricted to the cities. As a result, there began to be a growing discrepancy between how women lived in urban and in rural environments where traditional practices still held sway. It took the 1949 Communist Revolution to begin to change the lives of China’s hundreds of millions of rural women. Communism came to China with the promise of equality, not only between rich and poor and between noble and common, but also between men and women. By promoting policies such as marriage reform, the CCP hoped to gain support from rural women still trapped in traditional lifestyles. The CCP allowed women to join the Party, and by 1925, it had 100 registered women members. Some women even started serving in the People’s Liberation Army.

The emancipation of women was supported by Marxist theory. To Marxists, women were one of the classes exploited by capitalist societies. The Marxists believed that social relations and social structures were determined to a significant degree by economic institutions such as farms and factories. To achieve equality for women, Marxists argued that society must first assume ownership of the means of production by establishing a command economy with nationalized industry. The Marxists therefore took a collectivist approach to women’s emancipation where women’s liberation depended upon liberation for all. The priority for men and women was thus to work together to achieve revolution. In 1949, when Mao Zedong took power, he reconfirmed the CCP’s commitment to women’s equality by his now famous quote, “in China, women hold up half the sky.” As women made up half of China’s population, building a great socialist society would be facilitated if women were liberated to engage in productive activity.

The 1950 Marriage Law

Once in power, the CCP passed the Marriage Reform Law in 1950. Prostitution, arranged marriage, child marriage, polygamy and the use of concubines were outlawed. Chinese could marry not just for obligation but also for love. It became easier to divorce. Indeed, between 1950 and 1953, divorce rates spiked as women took advantage of the law to dissolve loveless “feudal marriages”. Contemporaneously, a huge effort was made to move women into the workforce. Many women were relocated from the countryside into the cities where they worked as textile laborers. Female literacy was promoted, and 16 million women learned to read between 1950 and 1957.

By 1953, however, the Marriage Law began to experience growing and widespread opposition from men. Between 1953 and 1958, the CCP began to backtrack on its promotion of women’s equality. Instead, collective stability was prioritized. Propaganda campaigns were launched to promote the concepts of the socialist housewife and the model mother. These campaigns re-enforced the importance of domestic duties. It became more difficult to divorce and the CCP stepped up its efforts to keep couples together.

Collectivization, The Great Leap Forward and the All-China Women’s Federation

In 1958, Mao launched agricultural collectivization in preparation for the industrial push known as the Great Leap Forward; the goal of the Great Leap Forward was to have China catch up to western levels of agricultural and steel production in five years. Agricultural collectivization grouped peasants in large communes where they lived and worked together. Collectivization changed women’s lives radically. Housework was socialized and communal dining halls fed families; childcare became a collective effort, as did washing and sewing. This freed women to move into the fields while men worked on large-scale irrigation works, industrial projects, steel making and mining.

Established in 1949, the All-China Women’s Federation (“ACWF”) was a mass organization whose main functions were to help implement CCP policy through the mobilization of women and to promote gender equality. For many in the ACWF, the Great Leap Forward represented an unprecedented opportunity to increase women’s liberation as it provided women with real work outside the home. Mao believed that China’s ability to leap forward in steel and agricultural production was dependent on its ability to move women into the fields so that men could be freed up to engage in other work.

However, the reality of CCP policies for women during the Great Leap Forward differed from the vision of women’s liberation that the CCP promised women if they were willing to enter the workforce. Despite socialized housework, women continued to be responsible for all remaining domestic work, regardless of how many hours they worked outside the home. For instance, women in the 1950s and 1960s made their family’s clothes by hand, including spinning yarn and weaving cloth. After a long day in the fields, women often spent many hours at night making clothes and doing other work on behalf of their families. This additional contribution to the family household was not valued through the allocation of work points — the system of compensation on the communes. This continued the persistent undervaluing of women’s contributions and efforts by men.

Additionally, many men did not like seeing women trained in what they considered male skills or receiving a higher level of pay. Men thus put pressure on the CCP to preserve their dominant status. As a result, not only were men given the jobs which paid the highest work points, but even when men and women performed the same work, men mostly received more work points than women. Moreover, work done by all members of the family was usually tallied as a whole. Its value was then distributed to the male head of the household at the end of each work period. Rural women thus were not able to exercise any direct control over the incomes they earned.

In the cities, men were overwhelmingly assigned to technical jobs and women to non-technical, auxiliary, and service jobs regardless of their educational levels. This gendered employment practice helped to re-establish women’s subordinate position. The difference in work opportunities was often justified by citing the differences in men and women’s biology; a woman’s weak physique was better suited to light, female-oriented work. Women were also less likely to be given work in large state-run enterprises where health, pension and housing benefits were provided. Rather, they were given jobs in the lower paying community and neighborhood-run industries that offered few benefits. Unlike rural communes, however, urban women were able to collect their own wages which did give them a greater voice in the family’s decision-making.

Nevertheless, inside the urban family the traditional patriarchal patterns persisted. Men could more easily secure housing accommodation from their work units. Single men slept in dormitories while women remained with their families until they were married. These housing policies continued the practice of men providing housing in marriage, reinforcing the idea of female dependency, and making marriage materially necessary for women. It also made women vulnerable if marital problems arose. Additionally, regardless of the hours worked outside the home, like their rural counterparts, urban women were still responsible for most of the domestic work and family care.

As the hours that women worked in and outside of the house sharply increased, the health of women – particularly rural women – began to suffer due to overwork and malnutrition, especially as the Great Leap Forward policies pushed much of the country into famine conditions. There was enormous pressure on women to overcome the physical limitations of their bodies through the sheer force of their wills. Women became liberated not by being valued in their own right, but by emulating men and by denying the realities of their own physicality. Miscarriages and prolapsed uteruses became common as women were encouraged to carry out strenuous and difficult work regardless of pregnancy or recent birth. Despite these hardships, however, many women have looked back on the Great Leap Forward years as ones in which they were freed from the isolation of the home when they could laugh and communicate all day in a shared workspace.

After the failure of the Great Leap Forward, the CCP retrenched on all fronts. As steel making efforts subsided with the failure of the backyard furnaces and as new irrigation works were completed or abandoned, women were forced back into domestic roles to make room for the men in the fields. Women’s new-found emancipation was to be once again sacrificed for the good of the country.

The Cultural Revolution

The 1966-1976 Great Proletarian Cultural Revolution was a social-political movement launched by Mao Zedong. Its objective was to deepen the Chinese Communist Revolution by removing bourgeois elements that were subverting Chinese society with the goal of restoring capitalism. Mao argued that these revisionist elements needed to be removed through violent struggle. He called on China’s youth to form Red Guard troops to stop the return of capitalist tendencies. In the violence that followed, millions were persecuted — suffering public humiliation, arbitrary imprisonment, torture, sustained harassment, and the seizure of their property. Millennia old historical relics and artifacts were destroyed, and education was largely suspended.

For women, the Cultural Revolution brought them once again out of their homes to engage in production and politics. Women were told to prioritize their responsibilities to the collective over their responsibilities to the family. In 1970s, an anti-Confucius Campaign attacked the traditional family structure and purported to explore the causes of women’s subordination. During the Cultural Revolution, women were encouraged to engage in violence to shed submissiveness and their gentleness, qualities that Mao said were bourgeois. It was not uncommon for women to interrogate and then physically beat up “bad elements”. Women were also encouraged to enter politics, and by 1975, 24% of the National People’s Congress members were women.

Yet, as it had been in the past, the CCP’s support of women’s emancipation during the Cultural Revolution was used primarily for the purpose of advancing Communist Revolution as opposed to rectifying inequality itself. Cultural Revolution slogans such as “Now the times have changed. Men and women are the same” were cried out, however, any references to the special problems of women were denounced as bourgeois. Once again, women dressed like boys, cut their hair short and scrubbed their faces of makeup. Women were attacked if they looked too feminine, as femininity was deemed a backward element. The art, literature, films, operas, and ballets produced during the Cultural Revolution featured androgynous women proletariat heroes – farmers, workers, militant fighters, and political activists all committed to the collective cause. After having been discouraged from divorcing since 1953, women again initiated divorces in record numbers as they, and at times their husbands, tried to distance themselves from their spouses when they got into political trouble.

However, despite all the rhetoric, the chaos of Cultural Revolution prevented the implementation of any meaningful women’s liberation policies. For instance, women sent down to the country still usually only received half the work points of men. As China began to recover from the excesses of the Cultural Revolution which formally ended after the death of Mao, women once again were encouraged to take up traditional roles. The numbers of women participating in politics gradually began to drop and divorce was again frowned upon. That women have repeatedly been asked to give up newfound freedoms for the good of the nation has served to devalue women’s emancipation as a real goal.

The One Child Policy

In the early years of the founding of the People’s Republic of China, Mao considered a large population to be a positive asset, both as an aid in economic development and a resource in national security. As a result, the majority of China’s population continued the tradition of seeking to have as many sons as possible and China’s population almost doubled in less than thirty years, from just over 550 million in 1950, to just over 1 billion in 1982. In 1970, concerns regarding China’s exploding population caused Beijing to implement a voluntary birth control system supported by campaigns promoting later marriages, longer birth intervals, and fewer children; contraceptive was made widely available. As a result, China’s total fertility rate plummeted from 5.8 births per woman in 1970 to 2.7 in 1978. In September 1980, in order to reduce the birth rate further, the so-called “one-child policy” was introduced, which limited couples to having only one child in most cases.

Female rural workers, 1920s (femaleworkers1920s) http://visualisingchina.net/#hpc-ar03-062

For women, the one child policy removed the traditional pressure that they felt to keep having children to produce sufficient sons. As a result, the policy helped reduce the burden of housework that many children generated. This in term provided women with a greater bandwidth to seek work outside the home. The one-child policy has also meant that China’s tradition of equating sex with procreation shifted. While promoting family planning, the government also began distributing literature about the pleasurable aspects of marital intercourse.

That said, the one-child policy demonstrated in stark relief the continued Chinese preference for boys. Incidents of female infanticide and the abortion of female fetuses rose significantly after the implementation of the policy. The 2010 census suggested that there are about 118 males births for every 100 female births in China. By 2020, there will be 24 u according to the Chinese Academy of Social Sciences. One ironic consequence of the policy might be the increased value of Chinese women. Female scarcity means that men have had to compete more aggressively in order to obtain a wife. Indeed, the government is beginning to acknowledge the imbalance between the sexes as a real social problem and have launched campaigns to encourage parents to value and raise daughters. These campaigns reflect the government’s fear that a future surplus of unmarried males could result in social unrest. In some areas, trafficking of women from less developed parts of Asia such as Vietnam, the Philippines and Cambodia, has started to fill some of the demand for brides.

Women and Market Opening

In December 1978, the CCP led by Deng Xiaoping began a series of economic reforms that introduced capitalist market principles into the Chinese command-driven economy. The first stage included the de-collectivization of agriculture, the gradual shift away from communal living, the freedom of Chinese households to start up small-scale businesses, the freedom to buy and sell goods on their own behalf, and the opening up of the country to foreign investment. The second stage of reform, which took place during the late 1980s and 1990s, saw the privatization of many state-owned industries, the lifting of price controls, and the reduction of protectionist policies and regulations.

Market opening has, in some respects, had a negative effect on the fight for women’s equality in China. The government’s commitment to fight women’s inequality has taken a backseat to its desire to promote economic growth. This retreat from its promotion of women’s emancipation has helped encourage a return to more traditional gender expectations. The androgyny of the Cultural Revolution gave rise once again to images of women who were sweet, beautiful, and feminine. There has been a return to themes such as that of women as a gentle companion awaiting the guidance and protection of her successful husband. The Chinese male was to create China’s economic success and woman’s primary job was to support him. Yet as market opening has progressed, there has begun to be a growing number of ideals competing to define the perfect woman. Contemporary China now sees traditional culture, the legacy of Maoist socialism and global capitalism contending with each other to influence the new norms of Chinese society.

In rural areas, the de-collectivization of agriculture and the dismantling of communes initially returned women to the house where she once again took up traditional roles within the household. Women in urban areas have also been displaced from the work sphere. From the 1980s onwards, the returned youth from the countryside and privatization of state-owned industry has meant that there has been tremendous pressure on women to return home to free up work for their male counterparts. As the privatization of state-owned enterprises gained increasing speed throughout the 1990s, women were the hardest hit with the job losses; indeed, 62.8% of the people laid off were women.The non-technical, auxiliary and service departments in which women overwhelmingly worked were some of first to be dismantled when state owned enterprises were privatized. Women over 40 were made to retire while their male counterparts could continue to work until 50. Once China’s economy began to take-off after reforms were in place, men were re-hired in significant larger numbers compared with women.

Part of the reason that men fared better during the privatization of urban businesses was that they had better business connections or guanxi. One reason for this was that women were hampered by their domestic responsibilities. The extra demands that managing the household required meant that women had less time to develop the business network needed to help secure their employment. Those women who did try to develop their networks were often condemned as being “loose” or as being women who had slept their way to the top. Indeed, men in senior positions often used their status to sexually harass women, and, therefore, women frequently avoided men to evade being placed in compromised positions. Additionally, as women had the worst jobs, it meant that those connections they did succeed in making were often less powerful than those of their male counterparts. This created a self- perpetuating cycle where low-skilled work led to less powerful connections which meant they had less chance to receive promotion.

Moreover, as the implementation of a market reform progressed, Chinese companies began having an increasing need for skilled and well-educated workers. Women were again disadvantaged as they had poorer access to schooling, especially at the university level. When assessment tests began to be used in the 1980s to qualify workers for jobs and promotion, women were again in a less favorable position as their significant domestic responsibilities meant that they had less time to revise for examinations.

Party officials also preferred to lay off women because when they lost their jobs, they went home quietly where men sometimes took to the streets in protest. Party officials were heavily invested in preventing social unrest in the cities. Once women lost their jobs, they had no recourse other than to go back to relying on their families for survival. 

Market reforms initially unleashed a massive exodus of rural male migrants who went to the cities in search of work, again opening a place for women to move into the fields. A 2000 census showed that 69% of all women work in farming compared with 61% of men. That said, eventually some young unmarried women joined the migrant stream, although in lesser numbers and with greater risk to their reputations and their safety. While often trapped in the lowest paying jobs with few protections, market opening has allowed women an opportunity to earn their own wages.

Trends

Empress Dowager Cixi (empressd) http://visualisingchina.net/#hpc-jw-s02

Chinese women have made great strides since Dynastic Times. Specifically, life for women in China today has vastly improved since the Communists took power in 1949. Above all, Chinese women are better educated, have more work and political opportunities, and by and large, are free to marry and divorce as they choose. In addition, China’s rapid economic growth has meant that washing machines, rice cookers and microwaves and other time-savings conveniences have transformed Chinese domestic life and are even widely available now in China’s less-developed provinces. The One Child Policy has also freed women from the need to have endless children. This trend toward greater personal and economic autonomy for women will continue in the coming decades. Indeed, China’s economic reform has brought unprecedented opportunities to Chinese women; China today, for instance, has more self-made female billionaires than any other country.

As a counter trend, Chinese women continue to face real limitations and inequalities. A long tradition of patriarchal authority has been deeply embedded in China’s culture since dynastic times. This male dominance continues to influence Chinese society today. A 1990’s All-China Women’s Federation survey found, for instance, that a third of both male and female Chinese respondents considered men more inherently “able” than women; and more than half agreed that a woman’s place is at home caring for her family.  Most Chinese women continue to take full responsibility for the home, children, and family elders, regardless of the hours that they work or the income they earn.

This traditional patriarchal influence has flourished given the recent absence of CCP leadership on gender inequality. Since market opening, the government’s fight for women has taken a backseat to its efforts to promote economic growth. Today, women’s emancipation remains a secondary priority.

As a result, women struggle to take advantage of modern developments in employment, education, and politics, while trying to balance continuing traditional expectations about their appropriate and proper role in family and society. This continued battle with traditionalism has created a situation in which women from all walks of life can find themselves limited in what they can achieve, despite a rise in college degrees, incomes, and political influence.

References

China’s Challenging Environment

Introduction

The state of Chinese environment today must be placed in the context of the extraordinary development that it has accomplished and of the continuing challenges it will face in the upcoming decades. Since 1981, China has lifted approximately 500 million people out of absolute poverty, an unprecedented achievement. Yet, in 2008, 172 million Chinese citizens still lived on less than $1.25 a day and about 400 million earned less than $2 a day. China’s population continues to grow, and is expected to peak at 1.4-1.5 billion people by 2030. Inequality in China has increased significantly both within the population, between rural and urban residents, and between different regions within the country. Those Chinese moving into the middle classes are demanding a better diet, modern housing, and the consumer goods which have long been common in the West.

China has raised the per capita income and standard of living of its citizens by providing an export-led, average GDP growth rate of over 8% over the last several decades. Much of that growth was fuelled by high- sulphur coal, with lax environmental regulation. The result has been a massive degradation of China’s environment. In 2006, China surpassed the United States to become the world’s largest source of carbon dioxide emissions. An estimated 70% of China’s rivers and lakes are currently contaminated, and 300 million Chinese people drink tainted water.

In part, China has achieved its unparalleled economic growth since the launch of its 1980 market reform through a policy of greater decentralization. The central government today has less of an ability to impose absolute control over provinces than it had previously. Environmental law has also been slow to develop and has not been aggressively enforced. Moreover, China’s “Century of Humiliation” has caused it to be protective of its sovereignty, and suspicious of foreigners and their environmental agenda. Indeed, China has opposed the monitoring of its greenhouse gas emissions as it views this as excessive intervention in its internal affairs. Partly as a result, China has not been transparent about environmental data. Its citizens, even its scientists, and the international community often lack the information needed to understand the full impact of China’s development on Chinese and international eco-systems. The basis of the Chinese Communist Party’s legitimacy has also shifted during the last three decades. Though it cannot ignore issues that threaten social stability, CCP power is now more dependent on its ability to continually deliver improving living standards than it was previously.

This has led China to follow a “grow now, clean-up later” approach to development. In international negotiations, China has vigorously opposed any binding, monitored agreement to reduce global emissions of greenhouse gases, although more recently it has pledged voluntarily to improve its own energy efficiency relative to economic output. Until recently, China’s calculation has been that short-term mitigation is more costly to the regime than adapting to a changing climate later, particularly given development’s immediate financial, political and social benefits. China’s 12th Five Year Plan seems to marks a shift in this attitude. Unlike previous plans, climate change and energy are featured prominently, and a strong emphasis is placed on targeting a more sustainable average annual GDP growth of 7%. The 12th Five Year Plan also adopts as binding domestic law the voluntary climate pledges China first made before the Copenhagen 2009 United Nations Framework Convention on Climate Change. More recently, in a joint announcement with President Obama in November 2014, Chinese President Xi Jinping announced a target of peaking carbon dioxide emissions around 2030 with a goal of reaching that target earlier, and an intention of increasing the share of energy coming non-fossil fuel sources to 20% by 2030.

That said, China’s 11th Five Year Plan also called for a slower average GDP growth rate of 7.5%, which China significantly exceeded. Ambitious local officials often consider Five Year Plan objectives as targets to be exceeded. GDP growth is a way for provincial officials to compete with rival regions and get promoted. Indeed, historically the performance evaluation system of government officials in China stresses the economic indexes while ignoring environmental protection indexes. This incentivizes local officials to prioritize GDP growth. As environmental protection can hamper GDP growth, environmental protection indexes have previously only constituted a small part of performance evaluation. After the 11th National People’s Congress in March 2011, Premier Wen Jiabao acknowledged this when he noted that GDP-oriented criteria for evaluating performance and government officials was an obstacle to achieving the environmental goals laid out in China’s 12th Five Year Plan. As a result, the central government would work toward adopting new performance evaluation criteria for local governments they gave more weight to the efficiency of economic growth, environmental protection and living standards improvements. Yet it will remain difficult to deter business leaders and officials who are profiting handsomely from rapid development.

Ultimately, many factors will influence China’s environmental policies in coming decades, not all of which are under central government control. Factors which encourage sustained pollution include: the continued need to provide economic growth to ensure political and social stability; the difficulty in implementing national environmental policies at the regional level; the ineffectiveness of MEP (China’s Ministry of Environmental Protection); and general corruption. Factors which are acting to protect the environment include the increasing recognition by Beijing of China’s limited bio-capacity, the increasingly vocal demands of its citizens to protect the environment, China’s significant investments in green technologies, and China’s opportunity to lead the world in green markets. It is still unclear which combination of factors will ultimately have the greatest influence on China’s short, medium and long-term environmental policies, or the state of its environment. That said, there is an undeniable trend toward recognizing the importance of environmental protection in China.

The State of China’s Environment

China’s environmental statistics are grim. In 2009, for instance, China surpassed the US to become the world’s largest energy user. While China’s average per capita emissions remain below those of the US, they have overtaken the global average, and are rising rapidly. Despite efforts by China to improve its energy efficiency, its CO2 emissions from fossil fuels rose by almost 80% during the past decade. The Chinese government recently conceded that only 3 of its 74 major cities met national air quality standards during 2013. Indeed, the Beijing-Tianjin-Hebei area had an annual average levels of PM2.5 – tiny pollutants smaller than 2.5 microns – at 106 micrograms per cubic meter, more than 10 times the World Health Organization’s safety level of 10.

This pollution is affecting countries worldwide, and not just because of the consequences of global warming. An analysis of air in places as disparate as San Francisco and Kyoto found chemical signatures of coal-fired Chinese power plants, smelters and chemical factories. Additionally, China’s water is also both in short supply and highly polluted. Growing urbanization is increasing both China’s air and water pollution and exacerbating its water scarcity since urban dwellers consume three times more water and energy than do rural residents. Moreover, an estimated 70% of China’s rivers and lakes are now polluted. In 2009, 57% of the 7 monitored river basins had pollution levels of I-III, suitable for drinking, swimming, household use, and able to support aquatic life. 24% of the water in China’s rivers had levels of IV-V, water unfit for swimming, but suitable for industrial purpose. 19% had V+, meaning that the water is considered useless, unfit for industry or agriculture. 23% of China’s key lakes and reservoirs had water grades of I-III, 42% IV-V and 35% V+. 2.3% of groundwater in 8 regions was rated I-II, 23.9% was graded III, and 73.8% ranked IV-V.

Stresses to China’s environment will continue to grow in the future. By 2030, three quarters of the 11 gigaton projected increase in energy-related global CO2 emissions is expected to be generated by China. By 2030, an estimated 390 million vehicles are projected to fill China’s roads, an almost 3 fold increase from today. Urban floor space will need to double to accommodate the approximately 350 million additional people moving into cities. At the same time, an expanding number of Chinese will rise into the middle classes, increasing demands on the environment further. Even with its aggressive development of alternative fuels, by 2030, it is still estimated that China will need to burn almost 200 million more tons of coal than in 2005 to provide sufficient heating and electricity for its new urban citizens. Indeed, overall coal-based power generation capacity is projected to triple between 2005 and 2030. Proper desulfurization of coal plants will require sizable capital investments and extensive regulatory monitoring. Urbanization and rising living standards will also increase demand for greater varieties of food. China will need to control desertification, overgrazing, the overuse of fertilizers, and over-logging in order to preserve the productivity of its arable lands. Moreover, managing the growing amount of urban waste will be a major challenge.

China’s Position on International Climate Negotiations

Yet, despite pollution levels which are increasingly having consequences for both China and the world, China aggressively defends its right to develop and thus pollute. In 2007, China’s National Development and Resources Commission reiterated China’s past position that “developed countries should take the lead in reducing greenhouse gas emissions as well as providing financial and technical support to developing countries. The first and overriding priorities of developing countries are sustainable development and poverty eradication.” In other words, as a developing country, China must give priority to economic development over environmental protection. Domestic environmental issues take precedence over global concerns. As developed countries are responsible for the large part of historical degradation, they must limit their emissions first, and pay for and transfer technology to developing states to address their environmental problems. These payments are not loans but compensation for the developed world’s historical environmental damage. Developed countries must also take a lead in the reduction of greenhouse gases, and the implementation of signed agreements. The sovereignty of the country’s national resources must be respected. There should be no linking of aid or the implementation of sanctions to any formal agreement to change environmental practices. Environmental considerations should not be used as a reason to interfere in the international affairs of a developing country, or as a reason to impose trade barriers.

China has expanded its position in recent years by noting that population control is one of the most successful strategies to curb emissions. China argues that given its effective population control since 1970, China should be given credit for this key mitigation effort. Additionally, as China has four times more people than the US, China should have a higher emissions quota. China has also advanced the argument that having a modest but dignified level of well-being – which some reason to be about $7500 annually – is a basic human right which takes priority over environmental concerns. China argues that those below this development should be exempt from any requirement to pay for climate policy which indeed includes a large part of its citizens. China contrast this argument with the fact that the richest 20% of the world use over 75% of global resources and emit 51% of global CO2 emissions to maintain their way of life. The Chinese also point out that the ownership and responsibility for emissions is a nuanced discussion; approximately 33% of China’s domestic 2005 CO2 emissions, for example, resulted from the production of exports, raising the question as to whether consumers also bear responsibility for these emissions because of their purchasing decisions.

To bolster its negotiating position, in the past China has formed an alliance with developing and very poor nations. In 1991, for instance, in advance of United Nations Conference on Environment and Development, China convened a forum attended by 41 developing countries which resulted in a unified negotiating position largely reflective of China’s views. During 1987 negotiations for the Montréal protocol to protect the ozone layer, China joined India and Brazil to insist that without significant financial support and transfers of technology from the international community, neither country would sign the Montréal Protocol on Substances that Deplete the Ozone Layer. This resulted in the establishment of the multilateral fund to offer developing countries assistance in the form of both financial compensation and technological transfers. The international community agreed to establish the fund because China and India’s emissions would cancel out the positive impact of the other signatories if they did not participate. That said, China was quick to sign the 1993 Convention on Biodiversity as it was not a threat to its economic growth. With funding in hand, China has worked to meet its commitments under the Montréal Protocol. For instance, in December 2011, China’s Ministry of Environmental Protection announced its HCFC Phase-out Management Plan (HPMP), a US$270 million project to cut consumption of Hydro chlorofluorocarbons (HCFCs) by 1 January 2015 by 17%. As China is the largest producer, consumer and exporter of HCFCs in the world – more than 70% of global HCFC production, and 50% of total consumption of developing countries – its current campaign is essential for the successful implementation of the Montreal Protocol. The plan is aimed at halting the 11% annual growth in Chinese HCFC production that has occurred in the last three years. Christophe Bahuet, United Nations Development Programme (UNDP) Country Director of China expressed optimism that China would reach its targets. Recently, China’s climate stance alongside developing and very poor countries has shifted. During the 2009 Copenhagen conference, for instance, China joined forces with the large, increasingly wealthy so-called BASIC developing states – Brazil, South Africa, India and China – to refuse binding limitations on greenhouse gas emissions, despite entreaties from extremely vulnerable poor countries, especially small island states, whose very existence is at threat by global warming. To this extent, China is no longer an unqualified defender of the developing world.

Increasingly, China has set forth voluntary, non-binding, and non-verifiable emission reduction targets as it did before Copenhagen, when it stated that it would “endeavour to lower its carbon dioxide emissions per unit of GDP by 40-45% by 2020 compared with the 2005 level; decrease its share of non-fossil fuels and primary energy consumption to about 15% by 2020; increase forest coverage by 40 million hectares, and forest stock by 1.3 billion m³ by 2020 from the 2005 levels.” Likely, China’s willingness to put forward these targets was because they were consistent with policies China was already adopting nationally. Indeed, China has many domestic policies related to climate change – to increase energy efficiency and to use more alternative energy, for example – yet these policies are often driven by objectives such as increased energy security, enhancing technological innovation and arresting desertification instead of outright greenhouse gas mitigation.

The Cost of Environmental Degradation to China

Despite its negotiating position in the international community, domestically, China recognizes that environmental protection is a pressing issue. In 2007, the World Bank assessed that China’s combined health and non-health cost of outdoor air and water pollution to be $100 billion annually conservatively estimated, or 5.8% of the country’s GDP. Four of the ten most polluted cities in the world are in China. The World Bank calculated that up to 400,000 people in China die each year from outdoor air pollution, 30,000 from indoor air pollution, and 60,000 from water pollution. An estimated 40% of all the global deaths linked to air pollution occur in China. This is reflected in greater rates of lung cancer and respiratory system problems. China’s water is also producing higher rates of various health abnormalities including liver and stomach cancer, stunted growth, miscarriages and birth defects. Polluted water is also exacerbating China’s severe water scarcity problems. It is conservatively estimated that urban water scarcity costs China about $14 billion annually in lost industrial output, and rural water scarcity generates an additional $24 billion in annual costs. In 2000, the Ministry of Agriculture related that almost 20% of agricultural and poultry products in major industrial and mining districts are irrigated with contaminated water. On China’s current trajectory, the health costs of air and water pollution could triple by as early as 2020, particularly as China’s population begins to age more rapidly.

Moreover, China’s 2011 “Second National Assessment Report on Climate Change” estimated that global warming will significantly impact China in the coming decades. In particular, the report predicted that China’s grain output could fall by between as much as 20% by 2050, putting greater pressure on food prices, and threatening China’s food security. The report also forecasted that global warming would lead to severe imbalances in China’s water resources within each year, and across the years. By 2050, eight of China’s provinces and provincial status cities could face severe water shortages (meaning less than 500 m³ per resident), and another 10 could face less dire chronic shortages. Additionally, since the 1950s, over 82% of Chinese glaciers which feed many of China’s major rivers have been in a state of retreat. With the report predicting that global temperatures will rise between 2.5 and 4.6°C above the 1961-1990 average, this rate of glacial retreat will increase. The report also estimated that sea levels will rise between 10 to 15 cm in the next 30 years, pressing up against China’s big coastal cities and export zones, making them more vulnerable to typhoons and flood tides unless China invests heavily in new coastal embankments.

Social unrest is also an increasing consequence of environmental degradation. The Chinese government received 750,000 environment-related complaints in 2008, a number that has increased approximately 30 percent annually since 2002. This environment-related social unrest risks threatening central authority. Moreover, it is estimated that by 2025 between 30 and 40 million more people may need to relocate due to environmental degradation. The environmental migrants are on top of the high numbers of Chinese citizens slated to be relocated as the result of China’s aggressive dam building.

Challenges to Implementing Environmental Policy in China

Yet while China recognizes the danger of its increasingly stressed bio-capacity, implementing effective environmental policy remains difficult. Perhaps the greatest challenge to implementing effective environmental policy in China is the sheer number of Chinese citizens still well within poverty levels, and the inequality of wealth distribution throughout the country. Until poverty and inequality eradication have been generally achieved, economic growth will be prioritized. Wu Shunze, Deputy Director General of the Chinese Academy of Environmental Planning noted this when he stated that China estimates its industrialization will be completed by 2030, that its use of resources and energy will peak between 2020 and 2030, and that between 2030 and 2050, China will then begin to see a greater shift toward a service-driven economy, and begin to repair environmental damage. China thus anticipates that until 2030, the relationship between the economy and the environment will be “in contradiction”, and will only become preliminarily “harmonious” by 2030.

Until then, China will look for win-win solutions where its environmental policies improve energy security, reduce production costs, promote job creation, and provide it with technological advantage in the world markets without impeding development at home. China’s belief in its ability to “clean-up later” is founded not just on western experience, but on its millennia old tendency to control and shape nature – uprooting forests, redirecting rivers, filling in swampland, building dams and dykes. Successive Chinese dynastic and now Communist governments have long pursued domination over ecological resources.

China’s growing focus on inequality is an increasingly key factor in its environmental discourse as inequality is potentially an existential threat to the Communist Party’s monopoly of power. As opposed to always approaching China as if it were monolithic, international engagement with China about the environment needs to be across multiple levels. What might be expected of China’s increasingly wealthy urban coasts can be an unreasonable demand for China’s poor western areas. Similarly, it is difficult for Beijing to set uniform, national environmental policy. Internal pollution mitigation will require strategies that address challenges at the global, regional, intraregional, city, small town and village levels. In 2009, President Hu articulated this by arguing that China’s wealthier eastern regions must take the first major step toward emissions mitigation, while poor western regions continue to catch up economically.

Since 1980, China has nevertheless implemented a flurry of environmental regulation. Decentralization after the 1980 market reform means that Beijing’s has increasingly imperfect control over its local governments. This exacerbates the environment’s “Tragedy of the Commons” principle. The problem of discharge into China’s rivers is illustrative. To enhance their competitiveness, each locality has an incentive for its factory to discharge its waste as cheaply (often illegally) as possible, with each factory’s waste seemingly inconsequential in relation to the river as a whole. Ultimately, the accumulation of its and other factories’ waste devastates the river. This effect is compounded by the fact that pollution fines are low and that natural resources are undervalued. Additionally, those most affected by river pollution do not always speak out against pollution when their livelihoods are dependent on the offending industry. While farmers, for instance, might suffer lower crop yields, sick animals, and deteriorating health because of polluted water, their income can nevertheless be reliant on the polluting factory which may be providing family members with jobs, investing in local infrastructure and purchasing farm produce, which in itself might be contaminated.

The ineffectiveness of local environmental protection bureaus compounds the problem. Numerous Chinese agencies are responsible for overseeing environmental protection depending on the pollution problem. These ministries often compete for international and domestic environmental funding. Their poor coordination and delineation of public duties creates conflicts of interest, especially at the local level. Nationally, responsibility for environmental protection in China rests primarily with the Ministry of Environmental Protection (MEP) formerly the State Environmental Protection Agency (SEPA). While elevation to a cabinet level ministry has enhanced its power, MEP still remains a relatively weak voice within China’s government. Historically, environmental funding has been low. China’s Environmental Protection Bureaus (EPBs) monitor environmental conditions at the local level. Despite MEP supervision and the bureaus seemingly large manpower – China’s roughly 2500 EPBs employ some 60,000 people – in general, the EPBs report to local governments for budget and resource support. This gives the local government leverage to protect local interests. A chronic lack of funding also hampers enforcement. Bureaus often have insufficient staff and cars for inspections. Factories are aware of these constraints and use this to their advantage by, for instance, discharging at night. Even when bureaus launch campaigns to close or sanction problematic companies, the companies often relapse into violation or reopen once the campaigns quieten down. Also, fines often cannot be applied to companies across administrative boundaries. Counties and cities have often shifted polluting enterprises near the border with downstream counties, so river discharge is carried quickly into the next province. Pollution fines also partly fund EPB activities. This can lead to perverse incentives where a bureau can encourage the persistence of pollution problems in order to pay its wages.

Courts are also often ineffective and enforcing environmental law. While China has an increasing level of environmental legislation, public awareness of environmental law remains poor. Given the poor availability of environmental data, when cases are brought to court, it is difficult for victims to provide conclusive evidence. Additionally, many polluting companies pay relatively significant levels of local taxes. As most courts are funded and staffed by local governments, there is an incentive to interfere with court proceedings in order to protect polluting companies and the taxes which flow from them. As a result, many environmental court cases are thrown out on the basis of flimsy reasoning.

Corruption is also a factor in China’s environmental degradation. In China, corruption can be seen as bribery and cronyism when developing environmental policy and when promoting harmful environmental practices, embezzlement of environmental funding, and bribery during environmental inspections and issuing of permits. Environmental corruption can also be connected to organized crime, particularly in mineral, timber and wildlife trafficking.

Trends

What is certain is that, even if it were to implement every environmental strategy discussed in China’s 12th Five Year Plan, China’s greenhouse gas emissions will continue to rise. What is uncertain is the level of that increase. Many factors influence the rate of environmental degradation within China, and its contribution to global warming. On the negative side, the decentralization that has occurred as China has transitioned to a market economy means that it has less absolute control over its regions than it did historically, so that enforcing national environmental regulation remains challenging. Moreover, courts and regional Environmental Protection Bureaus are often funded at the local level, reinforcing regional control over the implementation of environmental policy. Currently, most market and political incentives encourage local officials to continue to prioritize rapid economic development. While Beijing has indicated a move toward decoupling promotion from GDP growth, most local party officials will continue to be strongly incentivized by the financial benefits that accrue to their region and to themselves as a result of strong economic performance. Corruption will also continue to undermine environmental protection.

As the Chinese Communist Party’s legitimacy now rests in large part on its ability to provide a rising standard of living for its citizens, China will continue to need strong economic growth to raise its approximately 400 million citizens still living on $2 or less per day out of poverty, and provide them with a “modest dignified level of well-being”. In addition, growing inequality throughout the country is placing greater pressure on CCP leadership to provide opportunity for those regions, mainly in the west, that significantly lagged behind wealthier east coast provinces. While China increasingly speaks of the importance of sustainable development, and although it is increasingly investing in green technologies, it is unlikely that these technologies can come online rapidly enough to offset all the pollution that will be emitted as China works to provide a reasonable standard of living for the bottom third of its population. Additionally, China is racing against the problem of a rapidly aging population, trying not to grow old before it grows rich and before the competitive advantage of its huge inexpensive workforce begins to dissipate.

Given the challenges of China’s decentralization, and the pressures of poverty, inequality and a rapidly aging population, what is most likely is that China will continue to be the world’s largest contributor to greenhouse gas emissions and environmental degradation for at least the next two decades. Yet within this high greenhouse gas emission model, there will be an increasing trend toward bringing on line a rapidly growing level of alternative fuels, green technologies and pro-environmental protection policies such as environmental taxes and cap-and-trade pilot programs. Indeed, by the end of 2030, it is possible that China will be a world leader in many of the green technologies that will be most impactful on protecting our global environment going forward.

In international climate change negotiations, China will continue to refuse to be constrained by internationally imposed targets which can be monitored by outside countries. Yet, China’s growing implementation of environmental technologies at home will allow it to be a much more constructive player in international negotiations in the future. Increasingly, China is likely to hold up its environmental accomplishments at home as an example to other countries; for example, by 2015, China is expected to lead the world in installed hydro, solar, wind, and nuclear capacity. Thus, China’s future in the field of environmental protection will be, paradoxically, both world-leading but also internationally uncooperative.

Rising Income Inequality in China: A Price Worth Paying?

Introduction

J. Margolis

China, a country of continental scale, has experienced inequality in many shapes and forms throughout its 4000-year history. Part of this inequality is regional; attributable to China’s sheer size and the diversity of its geography. Lack of water, arable soil, and good links to transport networks significantly affect an area’s ability to prosper. Areas that suffered from such deficiencies in China 1000 years ago tend to be the same areas that struggle with limited resources today. For instance, China’s southeast, with its abundantwater resources and excellent access to international markets, continues to be one of the wealthiest parts of modern China. China’s western plateaus, sparsely inhabited, with poor arable land and water resources, limited transport and infrastructure systems, remain poorer areas of the country today.

Inequality during the Mao Era

During the Mao era, the Chinese government set income equality across China as an important goal, although it was never fully achieved. Topographical advantage remained determinative, even in the face of economic policies aimed at reducing it. The CCP enforced a hukou family register system, which eliminated the ability of China’s citizens to move about the country, limiting them to the area in which they were born and their family registered. What this meant in practice was that those born in regions that lacked resources, or those born in the countryside, had relatively less wealth than those born in more resource-rich regions or in urban areas. Thus inequality during the Mao era was principally between urban and rural areas, as opposed to between individuals in the same area. Nevertheless, high ranking party officials did enjoy more relative wealth than those who were not part of the Communist Party, yet the lack of consumer goods and isolation from the international economy meant there were not many opportunities for even high-ranking party officials to have conspicuous consumer advantages over rank-and-file citizens. In fact, until the Reform era brought more consumer goods to China, most Chinese citizens merely strived for the four “must-haves”: a bike, a watch, a radio, and a sewing machine.

Inequality in the Reform Era

J. Margolis

In 1978, this all began to change with the implementation of the Dengist reforms. Deng explicitly declared that some should be allowed to ”get rich first”, with the implicit understanding that others can get rich later. This was a significant alteration in policy; for a communist government to accept, and even encourage, societal inequality was certainly groundbreaking. As China began to make the transition from planned- to market- economy – a journey that has, by no means, been completed – income inequality increased in measure with its transition towards capitalism. However, the early years of the reforms, at the beginning of the 1980s, were marked by a fall in overall inequality, driven by the loosening of restrictions on rural areas selling their excess produce for profit. This allowed those rural producers of food to close the income gap with their urban counterparts. Chinese official statistics struggle to provide an accurate picture of Chinese incomes today; the wealthy often under report their earnings and the very poor can be underrepresented as their geographical isolation and high illiteracy rates can make them difficult to track. Yet even those official figures that can be produced, which may try to disguise large disparities, have shown income disparity to be increasing. China’s Gini coefficient – the most commonly used measure of inequality under which an entirely equal society would have a coefficient of 0 and one that is entirely unequal would register as 1 – stands today at 0.47. This is considerably above both the World Bank’s ‘critical threshold’ of 0.4 and the US Gini of 0.41, and shows signs of reaching the extreme levels that plague Latin America. This statistic becomes even more alarming when viewed against the levels of inequality at the outset of the economic reforms: in 1980 the Gini coefficient was 0.28. In essence, inequality has risen in China by over 50% in thirty years. While this is in line with the Dengist policy of ‘letting some get rich first’, it is evident that continued increases on anything approaching this scale over the next thirty years would cause difficulties for the CCP both in terms of potential social unrest, something that is already a growing problem, and of its ability to undermine the CCP’s legitimacy base. The CCP has begun to recognize this rhetorically as well as in policy with speeches from Wen Jiabao and Hu Jintao peppered with references to the need to address income divisions.

Regional Inequality

BartlomiejMagierowski / Shutterstock.com

Today, the biggest discrepancy of incomes can be seen between regions. China began its capitalist experimentation in the Pearl Delta region of Guangdong province, where its workers sewed piecework for Hong Kong textile manufacturers. As more and more of China’s GDP began to be generated by international trade, this and other industries spread northwards along its coast. Consequently, China’s east coast is now its most developed area, with income levels at purchasing power parity (PPP) approaching those of countries such as Saudi Arabia or Singapore.

In the first 12 years of economic reform, growth in China’s interior regions was driven by a re-introduction of private markets in the agricultural sector, as well as increased productivity during the ‘green revolution’. This increased productivity allowed peasants to move into rural industry, such as the manufacturing of farming equipment, further driving rural GDP and income growth. Although this did initially cause the income gap between urban and rural areas to fall in the early 1980s, geographical inequality has since been rising and shows little sign of reaching a plateau.

TonyV3112 / Shutterstock.com

When it comes to inequality between coastal provinces and their poorer inland neighbors, differences in income have been rising ever since the start of the reform era, as the coastal east has benefited from China’s export driven economic growth. Apart from the obvious geographic advantages for trade, coastal provinces have benefited from government initiatives such as favorable tax and financing regimes. As a result, through much of the 1990s, coastal growth rates were three percentage points higher than those of inland regions and China’s coastal provinces remain more affluent than its interior regions. There is, however, some evidence that the phenomenon of coastal GDP growth outpacing the interior is starting to change, as rising wages in coastal areas and the consequent reduction in international competitiveness, has driven some industries inward in search of lower costs. One notable example is Foxconn, the giant consumer electronics manufacturer that produces goods for companies such as Apple and Sony, which has relocated part of its production line to the interior. That said, China’s interior western provinces still have a long way to go. In 2011 Guizhou, China’s poorest province, had a GDP per capita of 16,000 RMB (approx. $2,400), while Tianjin’s was 84,000 RMB (approx. $13,000). The three provincial-level cities in the east – Beijing, Tianjin, and Shanghai – have the largest incomes per capita by some distance, each with a per capita GDP of in excess of 80,000 RMB, while Tibet, Gansu, Yunnan and Guizhou – all in the far west of the country – are all under a quarter of this total.

Although huge differences in income between regions evidently remain, the central government has shown an increased interest in resolving this inequality. In 1999, President Jiang Zemin announced the “Develop the West Program”. As well as addressing ecological and security concerns, the “Develop the West Program” was intended to stimulate development in China’s least prosperous provinces and to soften the blow to China’s interior as China entered the World Trade Organization in 2001. This policy has had reasonable success; in particular, it has encouraged significant infrastructural investment in China’s western provinces. However, though it may have slowed down the rate of increasing inequality between east and west, the pattern has continued throughout this time, leaving those in the west relatively poorer than they ever have been.

Getting Rich First?

ValeStock / Shutterstock.com

Within any one region, individual income inequality is also now evident. Economic development tends to lead to income inequality in every society and China has been no exception. In June 2012 it was reported that the number of dollar-millionaires in China had reached 1.4 million, while the number of billionaires has been placed at between 100 and 600, second only to the US; at the same time there are still 400 million Chinese who live on less than $2 a day, and around 172 million on less than $1.25. Many workers have seen great returns on their education and skill levels; those with higher levels of education, experience, and skills were rewarded with increased incomes. Some were well positioned during privatizations, having party and other connections which allowed them to win contracts or acquire state assets at significantly reduced prices. Studies show that CCP membership is positively correlated with income. A report in 2009 said that around 90% of China’s billionaires are so-called “princelings”, the sons or daughters of leading Communist Party cadres. China does, however, have a long history of entrepreneurship and many Chinese have embraced this tradition. Some were just plain lucky, had a good idea, or were in the right place at the right time. Zhang Yin, for example, rose from humble roots to become China’s first female billionaire. She earned her fortune by buying scrap paper from the US, importing it to China where she turned it into cardboard before selling it back to US manufacturers.

Gender Inequality

project1photography / Shutterstock.com While one can point to stories of women such as Zhang Yin as examples of the relative freedoms and opportunities offered to Chinese women, nevertheless there remain real income differences between the sexes even within the same geographical area. Though Mao declared, “women hold up half the sky,” meaning that women were to be freed from the subordinated expectations of dynastic China, and to work as equals with men, this is seen by many not as demonstrative of his opinions surrounding gender equality, but rather his obsession with increasing the Chinese labor force. The male communist worker was still, on average, better compensated than his female compatriot. Yet the income-earning opportunities of women in the Mao era were unimaginably better than those of their ancestors, many of whom were confined to the house, teetering on 3 inch feet. Today, the pay gap between male and female workers shows no signs of decreasing. This is by no means confined to the elder generation; female graduates earn on average 13% less than their male contemporaries. Still, opportunities for women in China are often strong when compared with those of many other countries. For instance, 19% of Chinese companies employ female CEOs, compared with 9% and 5% in the EU and North American markets respectively.

Ethnic Inequality

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Another group that has consistently been at China’s lower income levels is China’s ethnic minorities. Part of this inequality may be caused by the fact that most Chinese minorities live in the western fringes of the country which often suffer from water scarcity, short growing seasons, and difficult access to transportation systems and international markets. The minority populations living in these areas often suffer from lower wages and living standards than those who have made their way to the east and the gap between Han and ethnic minorities can, to some extent, be explained in these geographical terms. Still, it is also true that the average Chinese ethnic minority suffers at least some discrimination regardless of where location, and often does not have the same opportunities as the average Han Chinese.

Inequality at what cost?

China has tolerated its growing inequality in order to achieve the rapid rates of economic growth that is has experienced since the 1980s. The CCP’s fear is that once economic growth starts to slow, which grows more likely given the continuing financial and economic challenges of the west, then the unequal distribution of wealth at various levels will cause major social unrest. The Tiananmen Square incident of June 1989 was partly caused by high levels of income inequality and in reaction to high levels of inflation that were squeezing the living standards of the poorest in China. Beijing is wary of the possibility of the reoccurrence of such an event, especially given the recent events taking place in the Middle East in what has come to be known as the ‘Arab Spring’, itself partly driven by dissatisfaction with levels of inequality. Additionally, as the poorest provinces in China are generally those with the highest percentage of ethnic minorities, China fears that their social unrest may exacerbate feelings of resentment towards Beijing and stoke ethnic tensions within society. Violence directed towards Han Chinese has already occurred in several parts of Chin, notably among the Uyghurs of Xinjiang, the Tibetans in Lhasa, and the Hui in Henan.

Chinese intellectuals today debate whether economic growth at all costs should be tolerated. Many propose a more “socialist” or European model of social development, where the state shares some of the responsibility for ensuring that all its citizens reach a basic level of economic prosperity. This prosperity would be significantly aided by the re-creation of China’s health and pension systems, which were often commune-based and largely dismantled when China privatized many of its state-owned industries. Developing its national healthcare and pension systems would also help China shift its economy from being largely export driven to being one that relies on much greater domestic demand. Currently, the average Chinese citizen saves aggressively in anticipation of future healthcare and pension costs that will need to be self-funded. A first attempt at providing a very basic social security was launched in 1999 with China’s creation of the Minimum Living Standard Guarantee Scheme (Dibao) designed to aid those most in need in the form of a very basic welfare package. The income limit for becoming eligible to this however is incredibly low. In urban areas, the average level is just over 200 RMB ($30) per month, while for rural areas it is below 100 RMB ($15) per month.

Future Trends

The persistence of inequality in China today is a thorn in the side of the CCP. Having largely moved away from its communist ideological base, the CCP’s legitimacy is largely based on nationalism and the promise of economic prosperity. China is faced with the double challenge of not only ensuring that its economy continues to grow, but of trying to see that its wealth is shared out as equally as possible. The potential for friction in society – and the threat that might pose to the CCP – is implicitly acknowledged in Hu Jintao’s drive for a ‘harmonious society’, the principle tenet of his ideological musings. It is important to note that despite the rise in relative inequality, the absolute living standards for almost every single Chinese person have increased since the economic reforms were implemented. Since the reform era began, China has lifted around 400 million people out of absolute poverty, an achievement unmatched anywhere in the world and throughout human history. This should not be underestimated even as the problem of relative wealth disparity is, correctly, addressed as a pressing issue.

It is of course impossible for any nation to be completely equal and most developed countries have their own problems with unequal distribution of wealth. China, with its vast size, enormous population, and varied geography, will always struggle with inequality. Inequality persists throughout China. While it is true that the west is poorer than the east, there are pockets of abject poverty even in the richest provinces and rich parts in the poorest areas. From the Communist Party’s perspective, its key task is to prevent income inequality from rising to such levels that widespread social unrest threatens its control of power. As China’s wealth grows, and as it invests large parts of its enormous surplus within its own borders, more government initiatives are expected to be designed to develop the prosperity of provinces and sectors of society that lag behind the rest. Nevertheless, in the short term, income inequality will continue to increase as China’s rapid economic development lifts its population from poverty at varying rates. The mammoth task for the CCP will be to ensure that inequality doesn’t rise at a faster rate than GDP growth. While the living standards of the majority are being raised it is likely that increases in inequality will not prove perilous for the authority of the CCP, especially as much of this inequality is between areas that are thousands of miles apart. The next 30 years will prove very difficult for China to maintain the balance between consistent economic growth and raising the living standards of those at the very bottom of the income ladder, although this can be managed as long as China continues to move towards a domestic demand-led, and not export-driven, economy.

Water in China: A Thirsty Country

Introduction

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China faces severe water shortages. Its current water per capita is one quarter of the world average, yet its overall per capita usage is still low by international standards, but this will increase over the coming decades. The water that China does have is often badly polluted and is inefficiently used. Moreover, China’s water is unequally distributed with the Yangtze River basin and areas to the south enjoying 84% of China’s naturally available water compared with just 16% in China’s north.

China’s water scarcity will challenge its future economic expansion. Already, agriculture, industry and China’s growing cities all compete for scarce water resources, as do China’s different regions. Decades-old economic priorities such as food self-sufficiency will be increasingly difficult to maintain because water used in industrial output creates more economic value than it does in agriculture. Water scarcity also creates domestic unrest. Increasing illness caused by polluted water is driving up healthcare costs and generating more internal dissent. In 2009, the Chinese government acknowledged that 90,000 “mass incidents” (a euphemism for protests) occurred, many of which were sparked by environmental and water degradation.

Population and its Impact on the Hydrological Cycle

Right from China’s earliest dynasties great attention was paid to agricultural productivity. The Chinese bureaucracy mobilized the Chinese masses to construct irrigation systems and to clear land. This created an agriculture-population feedback loop. Increased agricultural productivity led to a rise in population, requiring further hydro-engineering and agricultural innovation to maintain China’s swelling numbers. In an agrarian society, large families of many sons offered rural parents security both in terms of providing labor for farming and care in old age. In this way, China has remained the world’s most populous country for thousands of years. China is still the world’s most populous country today. In 2019, China’s population was approximately 1.434 billion people. By 2035, China’s population is expected to peak at 1.461 billion people. By 2050 and 2100, China’s population will reduce to 1.402 billion and 1.064 billion, respectively.

 

China’s large population today has risen in part because of a significant population surge between 1950 and 1980. During the period, China’s population grew from 554 million to just over 1 billion people. In order to feed its enormous and rapidly growing population, Mao mobilized its masses to create new agricultural and grazing land through the clearing of forests, the filling of lakes, the draining of swamps and wetlands, and the creation of large irrigation projects. While placing more agricultural land under plow and significantly expanding its irrigation networks, this significant transformation of China’s natural environment into an agricultural environment has impacted China’s hydrological cycle. When land is cleared of plant life through unsustainable farming and grazing methods, the local hydrological cycle is disrupted, and desiccation – the drying out of the environment – occurs. Instead of catching precipitation in the region and allowing rain to repeatedly return to the area hrough the process of evapotranspiration, deforestation, over-grazing and over-farming causes surface water to run immediately into streams instead of permeating the soil. In the north and northwest of China, it has been estimated that the average annual precipitation has decreased by one third between the 1950s and the 1980s; overall China has 350 billion m³ less water than it had at the start of the century equivalent to the amount of water that flows through the mouth of the Mississippi River in nine months.

China’s Significant Desertification

Approximately 28%, around 2.5 million km², of China’s land is desert or suffering desertification. China’s deserts have expanded significantly over the last six decades. China’s Environmental Protection Agency reported, for instance, that the Gobi Desert grew by 52,400 square kilometers (20,240 square miles) from 1994 to 1999. Overall, China’s semi-arid regions have increased 33% during 1994–2008 compared to 1948–62, and its deserts continue to expand at an estimated rate of 1,300 square miles a year. In addition to topographical and geographical conditions, factors driving China’s desertification include over-cultivation, overgrazing, pollution, wind erosion, water erosion, salinization of soils through over-irrigation, over-cutting firewood, water misuse, and industry and mining-related land destruction.

The cost of desertification is real. It is estimated that China loses approximately $6.8 billion annually from its growing deserts and arid lands. Desertification leads to depreciated land values, food insecurity resulting from reduced crop yields, heightened healthcare issues, and increased costs resulting from land protection efforts. Desertification and deforestation have also caused sediment levels to significantly increase in all of China’s river systems due to severe soil erosion. Greater soil levels in river water can impact the functioning of China’s many hydropower systems.

To fight China’s desertification, China unveiled the Great Green Wall program.  Launched in 1978 and targeted to continue until 2050, the program’s objective is to plant a shelterbelt of trees across the northwest rim of China skirting the Gobi Desert. The Great Green Wall is expected to be 4,480 km long and 560-1460 km wide. To date, an estimated 66 billion trees have been planted.

However, this massive reforestation program has been controversial. Much of the shelterbelt area, except for areas to the east, is not highly suitable to forest growth. Trying to plant trees in ecosystems not suited to forest can diminish biodiversity, reduce water recharge, and cause a loss of soil quality and moisture. Additionally, China has tended toward the planting of a single species of trees over large areas. In Ningxia, for example, 70% of the trees planted were poplar and willow. Monocultures tend to be more vulnerable to disease.  In 2000, for instance, one billion poplar trees were lost to disease, wiping out 20 years of planting effort. Additionally, monocultures do not increase biodiversity as they are not appropriate either for plants and animals normally found in the native, dry-land ecosystems or for the animals and plants that might want to migrate to newly forested ecosystems.

Another disadvantage of planting trees on grasslands is that they tend to absorb large amounts of groundwater. In Minqin, an area in north-western China, studies have shown that groundwater levels dropped by 12–19 metres since the advent of the project. As these trees absorb water levels, shallower-rooting native shrubs and grasses can die off. When this occurs, the soil on the forest floor is susceptible to wind erosion, the very challenge that the trees were planted to thwart.  As evidence of this risk, sand storms from wind erosion have become more frequent despite China’s herculean tree-planting efforts. Fifty years ago, dust storms plagued China about once every seven or eight years; now they occur annually.

Given the challenges of the Great Green Wall, there is growing realization shrubs and grasses native to the region may be much more effective in restoring degraded dry lands and holding sand in place. As a result, there has been some movement toward replacing the planting of trees with the sowing of native flora.

Water Scarcity

Overall, China is an extremely arid country.  As China’s population has swelled over the millennia, its per capita water has decreased. China now has an estimated 2,029 m3 of water per capita per annum, one quarter the world’s average. This per capita water figure is projected to decrease to 1,875 m³ by 2033. This water scarcity is exacerbated by China’s uneven water distribution. China’s precipitation patterns are heavily affected by the East Asian monsoonal climate. Its mountainous geography impedes and drains the monsoonal rains as they move from the southeast into the northwest of the continent. On average, southern China – including the Yangtze River basin and areas to its south – has approximately 80% of China’s water, yet the area supports 54% of its population, 35% of its arable land, and 55% of its GDP Conversely, northern China collected only 20% of China’s water to maintain 46% of the population, 65% of the arable land and 45% of its GDP. In some northern areas, strains on water resources are even worse. Beijing’s and Tianjin’s Hai River basin, for instance, receives approximately 1.5% of China’s water to support 10% of its population and 11% of its arable land. Moreover, 47% of total industrial output is fabricated in China driest 11 provinces including: Beijing, Gansu, Hebei, Henan, Jiangsu, Liaoning, Ningxia and Shandong. These 11 water-parched provinces account for just 7% of China’s total water resources but produce 36% of China’s agricultural production and 43% of total GDP while supporting 38% of the population.

Approximately 400 of China’s cities currently face water shortages, and over 300 million people drink water contaminated with pollutants including arsenic, excessive fluoride, toxins from untreated factory wastewater, agricultural chemicals, leaching landfill waste and human sewage. Moreover, China’s per capita water footprint is growing. China will not only have more people competing for its finite water resources in the coming decades, but each person will individually demand more water. Today, China’s overall water footprint per capita is still about half that of the US but is expected to grow by between 40% and 50% by 2030. Factors such as higher living standards, increasing urbanization and further industrialization are driving water demand. China’s rising wealth has meant, for instance, that its citizens are eating substantially more meat. The production of one kilogram of beef requires 600 liters of water compared with the 100 liters required for a kilogram of wheat. This shift in diet can be seen in China’s food footprint numbers. In 1961, China used 260 m³ of water per capita to grow food; by 2003 this figure had more than trebled to 860 m³.

Agricultural, Urbanization, Industrialization, Water Wastage

Currently, 62% of China’s water is used for agriculture, a sector which is responsible for approximately 13% of the country’s GDP. About 50% of China’s farmland requires irrigation, more than double the world average. Nearly 75% of total grain production and over 90% of China’s cash crops are sown on irrigated farms. According to China Water Risk, irrigation water usage was approximately 340 billion m3 in 2013, equal to the average annual flow from China’s Pearl River, China’s third longest river.  Yet agriculture water usage remains extremely inefficient, with an estimated 45% of agricultural water lost before it even reaches crops.  By contrast, water used for industrial output is 70 times more productive in terms of financial value than that used in wheat production.

That said, the water productivity of Chinese industry is also low by international standards. The industrial added value per 10,000 yuan of water consumption is about 50 m³ compared to 7-9 m³ in developed countries. Additionally, the industrial water recycling rate is less than 50% compared to 85% in developed countries. Overall, China’s overall water productivity – calculated by dividing GDP by annual total water withdrawal – remains low: $15 in 2015 compared with $318 for the UK, $115 for Singapore, $103 for Germany, $67 for Japan, and $36 for the United States.

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China’s growing urbanization is also requiring more water per capita. 70% of Chinese citizens are projected to be living in cities by 2030, up from 59% today. This is significant because urban dwellers consume three times as much water and energy as rural residents. Between 2000 and 2020, for instance, the World Bank estimated that China’s urban water consumption increased by 60% as its urbanization rate rose from 36% in 2000 to 57% in 2020. Moreover, more urban dwellers will require more electricity. Currently, it is estimated that 59% of China’s primary energy consumed was powered by coal.  Coal requires more water to produce them all other energy sources. Moreover, over half of China’s coal deposits are found in its north, the Chinese region which suffers from the most water scarcity.  Coal mining, processing, combustion, and coal-to-chemical industries are the country’s second largest water consumer after agriculture. Therefore, consuming more coal to produce more electricity will put additional stress China’s limited water resources. Finally, China’s urban water distribution networks are particularly leaky. In 2002, an investigation of 408 cities conducted by the Ministry of Construction found that urban water supplies lost an average of 22% of their total water flow.

Water Pollution

Despite China’s efforts over the last three decades, water pollution has spread from the coastal to inland areas and from the surface to underground water resources. An estimated 70% of China’s rivers and lakes are now polluted. In 2009, 57% of the 7 monitored river basins had pollution levels of I-III, suitable for drinking, swimming, household use, and able to support aquatic life. 24% of China’s rivers had levels of IV-V, water unfit for swimming, but suitable for industrial purpose. 19% had V+, meaning that the water is considered useless, unfit for industry or agriculture and unsafe for human contact even after treatment. 23% of China’s key lakes and reservoirs had water grades of I-III, 42% IV-V and 35% V+. 2.3% of groundwater in 8 regions was rated I-II, 23.9% was graded III, and 73.8% ranked IV-V.

Causes of water pollution include the disposal of industrial chemicals and waste, agricultural waste, and residential wastewater. Of these pollution sources, approximately 70% of the water pollution nationwide comes from agriculture, particularly runoff from fertilizers, pesticides, and animal waste. For millennia, China’s farmers produced agriculture through “organic” farming methods. Farmers collected every bit of organic waste to ferment for fertilizer. Nothing was wasted, and even human waste, or “night soil”, went into “honey buckets” to transport to the fields. Every winter and spring farmers dredged nearby rivers and canals to add sediment to the fertilizer. Particularly in the south, dense grass at the water’s edge was added to pig fodder, which, after being digested by the pigs, produced manure, and helped keep the rivers and lakes clear from vegetation. The entire process of recycling was labor-intensive but efficient. The rivers and lakes remained relatively clean despite thousands of years of intensive farming.

Yet, since 1978, fertilizer applications in China have increased fivefold. In general, animal and human feces are no longer collected for fertilizer, and instead are discharged untreated into rivers.

In addition to causing pollution, fertilizer runoff is also raising the instances of eutrophication. Although blooms of aquatic biomass are spurred by a variety of factors including nutrients, light, temperature, water flow, turbidity, zooplankton grazing and toxic substances, the main factor contributing to the growth of algae is the supply of nutrients.  Chemical fertilizer runoff has significantly accelerated eutrophication of many of China’s lakes such as Dian Chi in Yunnan Province, Chao Hu in Anhui Province and Tai Hu in Hubei Province where algae blooms absorb a significant portion of the lake’s oxygen, choking off fish and other aquatic life. Large algae blooms also broke out right before the 2008 Olympics, forcing Beijing to launch a massive emergency clean-up to ensure the sailing events could go ahead as scheduled in Qingdao, in Shandong.

In addition to pollution caused from fertilizer and pesticide runoff, rural areas also contribute to contamination by poor wastewater management. According to the 2017 China Statistical Yearbook, for instance, while nearly 95% of municipal wastewater generated by urban residents was treated, this number dropped to 25% for rural residents. Additionally, small-scale rural enterprises have less rigorous environmental monitoring, but frequently engage in all manner of heavily polluting production, such as the operation of paper mills, tanneries, and breweries. Pollution from the small-scale rural enterprises is aggravated by the fact that they are more likely to use outdated equipment and have less resources to spend on pollution abatement.

About 80% of China’s 7500 most polluting factories are located on rivers, lakes, or in heavily populated areas. While occurring less frequently than in the past, these factories have been known to release untreated waste and chemicals into China’s waters either intentionally or by accident. Example of this is the 2012 cadmium spill in Guangxi which polluted an approximately 100 km stretch of the Longjiang River at a level of more than five times the official limit, contaminating water supplies for Liuzhou, a city of 3.2 million people. Cadmium is poisonous and can cause cancer. Another example is the 2020 Heilongjiang province spillage of 2.53 million cubic meters of water containing molybdenum ore waste into the local river system. The spill contaminated water for 110 km southwest of the mining site, where the chemical oxygen demand reading (DOC) – a measure of water quality – was 5.7 times higher than standard levels.

China’s factories also release dangerous airborne pollutants that are absorbed into groundwater or contaminate rivers by way of urban runoff. Some of the most harmful are categorized as polycyclic aromatic hydrocarbons (PAHs), and an estimated 90% of water located in sources near Chinese cities is now dangerously polluted because of their presence.

Economic and Health Cost of Water Pollution

pcruciatti / Shutterstock.com The World Bank estimated that China’s water crisis is reducing China’s GDP by approximately 2.3% annually, with 1.3% attributable to water scarcity, and the other 1% caused by the cost of water pollution  estimates do not include the costs of ecological deterioration caused from the eutrophication of lakes and rivers. Nor do they reflect the economic cost of disease caused by water pollution, conservatively estimated at an additional 0.5% of GDP. In China’s most polluted areas, water has also been blamed for the recent high rates of various health abnormalities including liver and stomach cancer, stunted growth, miscarriages, and birth defects. This pollution can also be absorbed through China’s food supply. In 2011, it was estimated that up to 10% of China’s rice crop might contain unsafe or nearly unsafe levels of cadmium because of widespread irrigation with cadmium-poisoned water. A more targeted 2014 Greenpeace study testing rice harvested in Hunan province near a smelting site found that the rice contained dangerously high levels of cadmium, lead and arsenic.

China has also seen a rise in cancer rates. Contemporaneously with the rise in pollution levels in China’s lakes and rivers, digestive tract cancers including stomach, liver and esophagus have also risen and are now responsible for approximately 36.4% of cancer-related deaths in China compared to less than 5% of total cancer deaths in either the US or the UK. Additionally, there have also been incidents of contaminated river water from industrial activities leading to outbreaks of cancer concentrated in some villages. These villages have become colloquially known as Aizheng Cun, which literally translates as “Cancer Village.”

Flooding – Yellow River and Yangtze River

Not only are desertification and deforestation exacerbating China’s water scarcity, they are also aggravating China’s flooding challenges. The Chinese Minister of Water Resources, Chen Lei estimated in 2007 that China has lost 2% of national GDP annually to flooding since 1990 and a recent study placed the total costs of floods from 2000 to 2012 at 105 billion RMB annually (US $17 billion). Flooding has challenged Chinese rulers for millennia. From 602 BCE to 1938 AD it is estimated that major collapses of Yellow River dikes occurred once every two or three years. Then, every hundred years or so, the river would change its course. Many of the resulting floods were some of the deadliest natural disasters ever recorded. For millennia, the Chinese constructed dikes along the lower reaches of the Yellow River trying to contain its torrents, yet constant ecological destruction along the upper reaches increased erosion which intensified river silting. The silting raised the riverbed above the countryside. This “suspended” river greatly increased flood damage when the river inevitably breached its dikes. After 1949, the CCP built almost 3000 dams on the Yellow River, and heavily reinforced its levees and embankments. These hydro-engineering projects involved the equivalent of 500 million workdays and 1.4 billion m³ of reinforced concrete – enough to build 13 Great Walls. Yet many of the Yellow River’s dams have fallen short of physical and economic targets, and have resulted in huge losses of forest lands, wildlife habitat and aquatic biodiversity. Global warming has also increased evaporation at many of the dam sites.

Similarly, parts of the Yangtze River have flooded continually for millennia. Yet, as deforestation and reclamation of land has increased, floods have become more frequent and more destructive. The CCP attempted to solve the flooding by increasing the height of 3,600 km of embankments and more than 30,000 km of levies. The work required more than 4 billion m³ of dirt and stone, or enough material to put a wall around the globe three times. Yet these raised structures could not offset the loss of water absorption capacity caused by the rapid deforestation and agricultural land reclamation that occurred during the same period. As a result, the Yangtze experienced a series of significant floods in 1980, 1981, 1983, 1991 and 1996. Then in June 1998, China suffered one of its worst floods in 40 years, leaving 3,700 people dead, 15 million homeless and causing $26 billion of economic damages. The reinforced embankments and levees proved largely ineffective, with approximately 9,000 of them collapsing. As well as providing hydropower and improved navigation, the controversial Three Gorges Dam was built in large part to control the Yangtze’s flooding, although many scientists believe that the Yangtze is still vulnerable. Additionally, after the 1998 flood, China began to place greater importance on the role of ecology in flood prevention and has begun an extensive campaign of reforestation and forest preservation.

Drought

Because of the variability of the monsoonal rains and other factors, like flooding, drought has plagued the country for millennia. Yet desiccation, reduced precipitation and rising temperatures in many areas have made China’s droughts more frequent with longer durations extending over greater areas than at any previous time. For instance, research has shown that since 1980, severe droughts in China’s northeast have increased in frequency, severity, and duration. Between 1960 and 1980, acute droughts struck approximately once a decade. From 1980 onwards, droughts have occurred with greater frequency: in 1981, 1986, 1992, 1994, 1997, 2000, 2001, 2005-2007, 2010, 2017-2018, 2019, 2020. China’s southwest to northeast belt was the area most affected by drought. Regions most impacted include Inner Mongolia, Hunan, Yunnan, Hubei, Jilin, Anhui, Sichuan, Liaoning, Guizhou, and Shandong.

Although difficult to pinpoint specifically, it is estimated that China lost $7 billion annually due to the economic cost of drought between 1984 in 2017. If global warming continues apace, these economic losses could increase to between $47 billion annually if temperatures rise an additional 1.5°C to $84 billion if global warming drives temperatures above 2°C.  China has been essentially self-sufficient in grain for decades. This self-sufficiency camouflages the fact that China produces one-sixth of the world’s wheat output and one-fifth of global corn. China is thus enormously important to the world’s food supply. If drought significantly disrupted China’s food production on a large-scale, it could significantly impact world food prices. The risk is real. In every year since 2005, drought has challenged China’s grain crops, and the government has been forced to spend billions of dollars digging wells and cloud seeding to encourage rain. In 2010-201, northern China suffered its worst drought in 60 years, impacting most of China’s wheat producing regions. At its peak, it is estimated that 36% of China’s northern wheat fields were affected, and that 2.57 million people and 2.79 million livestock suffered from a lack of water. The water shortages also affected around 161 million people, with an economic cost estimated at $2.8 billion. In 2017, China’s Inner Mongolia region experienced a severe drought which affected 120,000 people and 500,000 livestock and 16 million acres of pastureland. It is estimated that the drought caused economic losses of approximately $780 million. In 2019, China’s Hebei province experienced a serious drought which impacted almost 800,000 ha of cropland and left 15,700 people and ,3000 domestic animals with diminished access to drinking water.

Drought has not been restricted to China’s drier north. In western Sichuan, for example, rapid deforestation caused Sichuan’s forest cover to fall from 3.6 million hectares in in 1985 to 2.34 million hectares in 1995 which has led to decreased precipitation. In the 1950s, serious droughts hit Sichuan about once every three years. In the 1960s, this became once every two years and by the 1980s, drought troubled Sichuan counties annually. In 2010, more than 20 million people in Yunnan, Guangxi, Guizhou, Sichuan, and Chongqing were left without adequate drinking water and a 2011 Sichuan drought affected almost 8 million people. Looking at drought conditions in Guangxi province specifically, records show that from 1618 to 1943, major droughts hit the region once every 33 years. From 1946 to 1972, the interval fell to every six years, and in the 1980s, it fell to every two years. There were four major droughts in the three-year period from 1989 to 1991. Since 2000, drought has plagued Guangxi annually. In 2004, for instance, 1100 Guangxi reservoirs went dry, and hydropower generation was cut dramatically. In 2007, one million residents in Guangxi and 250,000 in neighboring Guangdong faced water shortages during the worst regional drought in more than 50 years. In 2009, Guangxi, which produces 60% of China’s sugar cane, had a 10% drop in its production due to drought conditions. In 2010, 12 of the 14 cities in Guangxi were affected by water shortages. As another example, in 2019, Anhui Province, was plagued by the worst drought it had experienced in 50 years. Rainfall was at only 40% of normal levels. The neighboring provinces of Hubei, Jiangsu, Jiangxi and Zhejian were also significantly impacted.

Climate Change

How climate change will impact China’s water scarcity is still being studied. A study published by the Proceedings of the National Academy of Sciences estimated that drought related losses caused China approximately $7 billion annually between 1984 in 2017. If temperatures were to rise 1.5°C, these losses could grow to $47 billion annually. Above 2°C, drought losses could rise as high as $84 billion annually. Overall, however, a clear understanding of the impact of climate change on China’s water resources and agriculture is not definitive. Most scientists agree that more work is needed on regional climate simulations-especially simulations of precipitation-to better understand how a warming environment will impact everything from crops to diseases to future per capita water resources. (Piao, 2010)

What is definitive is that global warming is having an undeniable effect on the Tibetan Plateau. Like the Arctic and Antarctic, the Tibetan plateau is warming three times faster than the global average at .3°C per decade. In Tibet’s case, this accelerated warming is driven significantly by its Tibet’s high elevation which averages 4,500 meters. The plateau holds the largest amount of snow and ice after the Arctic and Antarctic, an estimated 14.5% of the global total including 46,000 glaciers. The plateau is also the source of 10 of the world’s largest rivers including the Yangtze, Yellow, Ganges, Brahmaputra, Mekong, and Indus Rivers which in turn provide water to over 1.6 billion people.  An estimated 80% of Tibet’s glaciers are now melting more quickly than originally thought. Many Chinese scientists believe that one-third of the glacial area in Tibet will disappear by 2050, and half will disappear by 2100.

Greater melting rates will have several effects. Melting glaciers often create glacial lakes dammed by unstable moraines. These moraine dams can unexpectedly burst, causing catastrophic flooding. Greater glacial melt water in the short term will increase river runoff. In the long term, as glaciers diminish or disappear, the resulting depletion of meltwater runoff is likely to deplete the year-round viability of Tibetan originating rivers, threatening the lives and livelihoods of billions of people downstream.

Power Outages

China’s water scarcity has also resulted in lower water levels of many of China’s major river systems. For instance, Chinese researchers have discovered that the volume of water entering the Yangtze River at its source on the Tibetan plateau has dropped by 15% over the last four decades. Similarly, a study regarding Yellow River water found that runoff has runoff decreased significantly between 1956 and 2009. Moreover, a 2013 study conducted by China’s Ministry of Water not only corroborated that the Yellow and Yangtze Rivers are experiencing declining water levels, but also found that approximately 28,000 of China’s original 50,000 rivers have now disappeared.   Part of the reason  for the disappearing rivers has been attributed to improved mapping techniques; however, the fact that rivers are disappearing has been validated by other studies. Other rivers, especially in the north, have become seasonal rivers flowing most strongly during the spring melts.

Diminishing flow levels in China’s rivers mean that the country will be challenged by power outages due to inadequate flow through its hydropower dams. Hydropower accounts for approximately 22% of China’s total installed capacity. It is estimated that the lack of water to run hydropower dams has cut hydroelectric power production by 20% and China may be forced to burn 1 million more metric tons of coal a week to cover the shortfall.

Trends

Serious water scarcity looms in China’s future. This scarcity is likely to increase competition between Chinese regions, between sectors of the economy and between urban and rural residents. It will also raise tensions between the government and parts of society that lack access to adequate, clean water sources. Moreover, the Tibetan Plateau is a source of rivers that reach 16 downstream countries including Pakistan, India, Bangladesh, Burma, Bhutan, Nepal, Cambodia, Laos, Thailand, and Vietnam. China’s damming, polluting, and use of international rivers is likely to increase tensions with these countries as populations in downstream riparian countries grow, and as  these economies continue to develop  and urbanize. Many of these countries, especially India, are already facing their own severe water crisis, which will only be exacerbated if China diverts river water that needs to be shared internationally.

Additionally, China’s water contamination risks exporting China’s pollution and water-borne disease to its neighbors downstream. This water pollution is exacerbated by rapid glacial melting. Glaciers capture atmospheric pollution; dangerous pesticides such as DDT and pollutants such as perfluoroalkyl acids are increasingly coursing downstream in meltwater and collecting in sediments and in the food chain.

Political relations could be further stressed if water shortages cause mass migrations of people. In fact, some analysts suggest that the so-called “oil wars” of the 20th century could be replaced by “water wars” in the 21st. Over the last 30 years, China’s Mekong dams, alone, have held back more water than they have released. There is some argument that, in anticipation of the fact that Tibet’s glaciers will likely be rapidly depleted in the next 80 years, China is compounding glacier melt for its future needs.

China’s immediate water solution is to use water more conservatively, and to improve pollution control. Historically, China has solved growing water demands through the construction of massive hydro-engineering projects such as the Three Gorges Dam and the South-North Water Diversion Project. In the future, China will increasingly need to solve its water deficit through ecological conservation, pollution management, more efficient water usage, and a redistribution of economic output by raising the price of water to reflect its scarcity and true economic value.

References

China’s Geography: The Physical Story

Introduction

With a total area of nearly 9,600,000 square kilometers, China’s landmass is slightly smaller than that of Europe. It stretches about 5,000 km from east to west, and about 5,500 km from north to south. China has land borders with 14 nations including Afghanistan, Bhutan, Myanmar, India, Kazakhstan, Kyrgyzstan, Laos, Mongolia, Nepal, North Korea, Pakistan, Russia, Tajikistan, and Vietnam.

Mountains, hills, and highlands cover about 66 percent of the nation’s territory. China’s surface slopes down in steps, starting from the Tibet plateau at 4000 m. China’s second geographical step averages 1-2000m and includes the Mongolia, Loess, and the Yunnan-Guizhou plateaus, and the Tarim, Junggar and Sichuan Basins. The third step, with an average elevation of 500- 1000 m, begins roughly at the edge of the Greater Hinggan, Taihang, Wushan and Xuefeng mountain ranges, and continues east to the coast.

Descending these geographical steps, China’s major river systems wind their way from west to east. Its largest river systems include the Yellow River in the north, the Yangtze River in central China, and the Pearl River in the south, all of which flow from the higher plateaus to the eastern Oceans. Along China’s east runs a 14,500 km coast.

Much as any other nation, the development and the history of the Chinese civilization have been profoundly influenced by its geographical setting. As early as 400,000 BCE, cave dwellers lived in China. Beginning in approximately 8000 BCE, people in north and central China began domesticating animals and growing food, especially millet in the Yellow River valley of the north and rice in the Yangtze River valley to the south. A warming climate aided agricultural innovation. The surplus food production allowed more populous and complex societies to evolve. By 5000 to 4000 BCE Neolithic settlements were scattered throughout China. By 2000 BCE these village settlements saw people begin to specialize in different kinds of productive occupations. By 2200 BCE, China’s first dynasty was formed. By 1500 BCE, the Han Chinese had developed a sophisticated civilization with character writing, bronze technology, the world’s most productive agriculture, walled cities and towns, and a powerful, national army.

Once China was established, it mountains, deserts, empty steppe lands and uninviting coast provided natural barriers that helped China to maintain remarkable continuity in language, cultural values, and social and political institutions, making China the world’s longest continuing civilization. China has historically been an inward looking country, content to develop within the confines of its vast continent. That said, it has also been shaped by a continual stream of outside influences, such as the arrival of Buddhism from India, the periodic invasion by Mongols from the north, and the trade of goods, most famously along the commerce networks of the renowned Silk Road.

China’s Western Lands

The western land of China is characterized by high plateaus and multiple mountain ranges which are broken by vast basins and deserts. This land is arid and cold, and suffers from constant drought. The lack of water has limited the number of people living in the region. Only 6% of China’s total population lives in the western half of the country.

Most of China’s mountains, including its five main mountain ranges, trend west-east. In southwestern China, the Himalayas and the Kunlun Mountains enclose the Tibet Plateau, which encompasses most of Tibet Autonomous Region. The Tibet Plateau with an area of 2.5 million kilometers, is China’s highest and largest plateau, about four times the size of France. Mount Everest is part of the Himalayan range and is located on the China-Nepal border. The Gangdise range parallels the Himalayas to its north. The Tien range crosses between the massive Tarim Basin to the south and the Junggar Basin to the north. Rich deposits of coal, oil, and metallic ores lie in the Tien Shan area. Between these two basins lies Turpan Pendi, which at 154 m below sea level, is the lowest point in China and the second lowest place in the world after the Dead Sea.

To the north of the Tibetan Plateau lies the Gobi and Taklamakan deserts, which stretch from the extreme northwest eastwards through Mongolia. The Gobi is the largest desert in Asia, covering parts of northern and northwestern China and Mongolia. The Gobi was part of the Mongol Empire and was traversed in part by the ancient Silk Roads. It is a cold desert for much of the year, and it is not uncommon to see frost on its dunes. Northeast of the Gobi, the Heilongjiang or Black Dragon River flows for 3,101 kilometers.

South of the Gobi lies the Inner Mongolian Plateau, an average of 1,000 m above sea level. The Yin mountain range, averaging elevations of 1,400 m, extends east-west through the plateau’s center. To its south is the largest loess plateau in the world, covering 600,000 km. Loess is a yellowish soil originating from the Inner Mongolian deserts. The soil is carried easily on the wind, and through the centuries, it has choked the Yellow River with silt. The Loess sand also plagues Beijing and its surrounding areas with dust storms, which turn the sky yellowish-gray and force people indoors or into protective gear. A March 2011 sandstorm, for instance, affected about 250 million people over an 808,000 sq. km area. China is planting thousands of acres of vegetation to stop spreading desertification, but the work will take decades to finish.

Along an arc that roughly outlines the southern edge of Inner Mongolia, the Great Wall of China extends approximately 8850 km, including 6260 km of actual wall, as well as trenches and natural defensive barriers such as hills and rivers. The wall was built to protect the northern borders of the Chinese empire against invasions by various nomadic tribes.

Eastern China

The eastern part of China is divided north-south by the Qinling Mountains, an extension of the Kunlun Mountains. This boundary is both physiographic and cultural. To its north flows the Yellow River, travelling through the North China Plain to the Yellow Sea. Home of Beijing, the Yellow River basin is called the “Cradle of Chinese Civilization.” It was the most prosperous region of early China, and has been the center of Chinese expansion and influence since ancient times. The North China Plain is vulnerable both to flooding and earthquakes. Over the last 3000-4000 years, the Yellow River has flooded over 1500 times often with catastrophic effect. For example in 1931, the flooding of the Yellow River, in combination with the Yangtze and Huai rivers, is estimated to have caused between 1 and 4 million deaths.

South of the Qinling mountain range are the heavily populated and exceedingly developed lower and middle plains of the Yangtze River and, on its western reaches, the Sichuan Basin. Crossing 6,300 km through the heart of the country, the Yangtze is China’s longest and most important waterway. It is navigable over much of its length, and has a vast hydroelectric potential. The Three Gorges Dam, for instance, spans the Yangtze at the town of Sandouping in Hubei province. Connecting the Yellow and Yangtze Rivers is the 1776 km long Grand Canal, one of the greatest engineering projects in China, and the longest artificial river in the world. Constructed between the 5th century BC and the 7th century AD, it is the only major Chinese waterway running from north to south.

Second only to the Qinling range as an internal boundary is the Nanling mountains, the southernmost of the east-west mountain ranges. South of the Nanling mountains is the Pearl River and its many tributaries which all flow into the Pearl River Delta. The Pearl River – used as a catchment term to refer to the watersheds of the Xi, Bei, and Dong (West, North and East) Rivers – is China’s third longest river after the Yangtze and Yellow Rivers and second largest by volume after the Yangtze. The Pearl River takes its name from all the Pearl colored shells which lie at the bottom of the river in the section which flows through the city of Guangzhou.

West of the mountains of the Pearl River, the Yunnan-Guizhou Plateau rises in two steps toward the mountain regions of the eastern Tibet Plateau. In Yunnan province, the plateau averages 2000m is characterized mountain peaks as high as 3700 m. In the Guizhou range, the plateau averages 1200 m in height, and is characterized by rolling hills, deep river-carved gorges and mountains marked with geological faults. Karsts – distinctive geological features caused by water eroding the limestone underlying the plateau- dominate the landscape. Such karst features include sinkholes, caves and natural bridges, and large underwater aquifers. The Yunnan-Guizhou plateau is the source of the Yangtze and Yellow Rivers.

In spite of the 14,500 km coastline fringed with offshore islands, China has traditionally oriented itself not toward the sea but inland, developing as an imperial power whose center lay in the middle and lower reaches of the Yellow River on the northern plains. The southern part of the coast is rugged and mountainous so that its good harbors provide poor access to the inland regions. The north coast is low and swampy. The Yellow, East China, and South China Seas are all part of the larger Pacific Ocean.

Arable Land

Because of the mountainous and arid nature of its geography, only about 15% of China’s total land area is suitable for farming, almost all of which is under plow. The lack of and the nature of its arable land has also led to one of the most labor-intensive agricultural systems in the world. Farming in the arid north along the Yellow River has required much coordinated effort, both to create irrigation systems and to build dykes to prevent the Yellow River from constantly flooding. Similarly, in the south, rice cultivation has always been extremely labor-demanding. From creating the clay-bottomed rice plots that trap water, to laying the muddy ground into which the pre-grown rice shoots are planted, to the intricate fertilization and pest removal that each shoot requires, to the rapid harvest of the ripe rice and quick re-planting to ensure two and sometimes three crops per year, wet rice production in the south is one of the most labor intensive crops in the world. Rice cultivation is also one of the most efficient in the numbers of people it can sustain. In fact, for much of its history, China has been one of the most populous countries of the world.

It has been argued that the demands of China’s irrigation, water and agricultural management have caused the Chinese to be a collective minded rather than individualistic people. What is true is that the Chinese have historically shown a great ability to organize its people to undertake tasks on a large scale such as the building of roads, dams, canals and defensive walls as well as the large scale production of iron and porcelain. It has also been argued that the nature of rice agriculture has caused China to develop a tradition and culture of hard work which is manifest in China’s work ethic today. What is indeed true is that the Chinese rice farmer works significantly more hours per year than a farmer sowing other crops such as wheat and corn.

China’s most important food crops are rice and wheat. Due to its high water and warmth requirements, most of China’s rice crops are planted in the south. This region also produces tea, sugarcane, and the mulberry leaves which feed the silkworms. Wheat is the chief crop of the north. Other northern crops include millet, maize, kaoliang (sorghum) and soya beans. In a few areas, cotton and peanuts are grown. Cattle, sheep, and horse ranching are limited to the grasslands of Inner Mongolia, Xinjiang, and Tibet. Ranching is rare in China proper because there are not the wide open plains necessary to maintain large herds. The optimal use of land is for cultivation of crops and animal husbandry, and most farmers keep chickens, ducks and pigs. This land constraint explains why there is a large-co-habitation between foul, swine and people in China, and why it has proved to be an effective breeding ground for such viruses as SARS and Swine flu.

China is currently losing arable land due to desertification and rapid urbanization. Currently, approximately 400 million people live in towns and cities, and China now has over 160 cities with populations greater than 1 million people, the largest being Shanghai and Beijing. By 2050, China expects 1.1 billion of its citizens to be in urban settings.

Climate

China’s climate is as varied as its topography. China’s climates range from the cold-temperate north to the tropical south, with subarctic-like temperatures in the Himalayan Mountains. In the winter, there is little rain or snow anywhere in China. In the summer, the warming land draws tropical sea air saturated with moisture into southern China. As the air encounters mountains and cooler inland air masses, rains fall plentifully in southern China. As the summer monsoon moves northwest, it brings less rain, meaning that overall China’s north is dry and its south is verdant. In bad years, the monsoons are too weak to cross into the Yellow River Valley, and become stuck over the central mountain belts, causing drought in the north and flooding in the south. In 2011, for instance, large floods in Southern China killed 132 people and displaced 800,000.

Nevertheless, overall, China is an arid country and is facing an increasingly severe water crisis. In 1997, for instance, the downstream stretches of the Yellow River ran dry for 226 days. In a project reminiscent of the Grand Canal, China has plans to build a vast new aqueduct – the South-North Water Diversion Project – which will divert at least six trillion gallons of water each year from the Yangtze River to satisfy the water needs of the North China Plain. The project has been likened to diverting water from the Mississippi River in the United States to meet the water requirements of Boston, Washington and New York and is projected to cost $62 billion, twice the cost of the Three Gorges Dam, the world’s largest hydroelectric project.

People

Around 1.3 billion people, or approximately a fifth of the world’s population, live in China. The Han Chinese, the native Chinese-speaking people, comprise approximately 90% of the population. 55 different ethnic groups, including the Uighurs, Mongols, and Tibetans account for the remaining 10%. China has seven large language groups each of which contain hundreds of dialects. Mandarin, based on the Beijing dialect, is China’s common language, and can be spoken by most Chinese people who have completed primary education.

Although the Communist regime has discouraged the practice of religion, temples and pagodas are found in most Chinese cities. For millennia, Chinese life has been influenced by the teachings of Confucianism, China’s major belief system. Buddhism and Taoism are also significant religions in China, and Islam is practiced by many of China’s ethnic minorities.

China’s Geography Today

The geography of China today has been altered over thousands of years by human habitation. The cleverness that enabled the Chinese to to support a population that exceeded 100 million people as early as the 12th century has extracted a real ecological toll on the country. One of the great tests facing China today is whether it can protect its natural resources during its current rapid development.

At the heart of this challenge is China’s scarcity of water. With 20% of the world’s population, but only 7% of global water resources, China faces severe water challenges. Mainland China has a per capita share of water of 2700 m³ per day, or one quarter of the world’s average. Moreover, the area south of the Yangtze River, which accounts for only 37% of China’s physical land, has 81% of China’s total water supply, while the 63% of land north of the Yangtze has only 19% of China’s water. Northern water demand is depleting underground aquifers. Drilling deeper to gain new water access has caused naturally occurring arsenic pockets to be reached, increasing the presence of arsenic in some water supplies. The World Bank predicts that by as early 2020, there may well be as many as 30 million environmental refugees within China due to lack of water and desertification.

The fresh water that China does have is often heavily polluted. 90% of the city’s groundwater and 75% of rivers and lakes are contaminated, and it is estimated that 700 million people drink polluted water daily. Water pollution occurs from industrial and municipal emissions, pesticides and fertilizers, and acid rain. Additionally, industrial pollution incidents, such as Songhua River toxic chemical spill in November 2005, have become more common.

The diversion to China of more of the water resources of major trans boundary rivers such as the Brahmaputra River and the Mekong River, risks being an increasing source of tension between China and countries such as Vietnam, Laos, Cambodia, Thailand, India and Bangladesh. For instance, China has built two dams on the Mekong, and has plans to build three more, inciting anger in Vietnam, Laos, Cambodia and Thailand. In the book Tibet’s Waters Will Save China, Chinese ex-officials have looked at ways for China to keep more of the Brahmaputra River to meet China’s growing water needs.

Another water related issue is China’s rapid building of dams to capture its hydro-electrical potential. Projects such as the Three Gorges Dam have not only raised environmental concerns as ecosystems are disrupted, but they have caused increased social unrest as millions of people are uprooted, sometimes without fair compensation. Environmental and social concerns around dam building will remain key points of debate in China in the near future.

There is a high correlation between the fertility and resources of its various areas and the wealth of its populace. Most of the wealthiest Chinese live in China’s southeast, where water is abundant, where as many as two to three rice crops can be harvested each year, and where easy access to export markets caused the region to lead China’s re-integration into the global economy. Similarly, the east coast of China is wealthier than its hinterland as it has better access to global trade. The poorest Chinese live in the arid north-west where deserts, mountains, and high-elevation plateaus prevail. Increasing inequality, caused in no small part by China’s geographical diversity, is an important concern for Communist party leaders. Growing social discontent at the increasing difference of wealth between regions and between people is a real risk to the Communist Party’s control of power.

Tectonically, China remains one of the most active seismic regions of the world. The country has a long history of being hit by deadly earthquakes. The largest earthquake occurred in 1556, where it was estimated that over 800,000 people died. Since 2005, China has experienced four deadly earthquakes in 2011, 2010, 2008 and 2005. According to official figures, the 2008 Sichuan earthquake killed over 69,000 people, and left almost 5 million people homeless. These earthquakes will continue to generate debate not only about Chinese construction standards and Chinese compliance with building codes, but also about the quality of China’s public health care system. Many of the 2008 Sichuan victims, for instance, had little or no health insurance, and poor access to healthcare facilities.

Flooding will also remain an issue for China. The summer monsoon draws tropical sea air saturated with moisture into southern China. In bad years, the summer monsoons become stuck over China’s central mountain belts and fail to reach the Yellow River Valley, causing drought in the north and flooding in the south. In 2011 it was estimated that floods caused $1.2 billion in losses, disrupted the lives of approximately 5.7 million people and damaged or destroyed more than 7000 homes. Areas most vulnerable to flooding include Zhejiang, Sichuan, Chongqing, Hubei, Anhui, Jiangxi, Hunan and Guizhou.

Agriculture and Food Security: A Long-Term Priority

Introduction

Throughout China’s thousands of years of history, famines have often led to rebellions and instability which in turn has led to many a dynasties downfall. Therefore, ensuring food security in China has been both a priority for Chinese leaders throughout the ages, and it remains a priority for the Chinese Communist Party today. China’s challenge is that it supports approximately 19% of the world’s population on approximately 9% of the world’s arable land and 7% of the world’s fresh water. Despite these constraints, China has met its food needs through a policy of agricultural self-sufficiency. Today, China is the world’s leading producer of rice, wheat, and soybeans, the world’s second largest producer of corn and the seventh largest producer of sorghum. Additionally, China is the world’s largest producer of pork, the third largest producer of chicken and the 10th largest producer of beef.

That said, China’s ability to maintain continued growth in agricultural output is under threat unless there is further reform in the agricultural sector. Increased urbanization, plateauing yields, water shortages, small farm sizes and uncertain property laws are all making it difficult for China to continue to increase agricultural production. China’s 13th Five Year Plan (2016-2020) recognizes these challenges. Investing in hybrid seed research, repairing and improving on irrigation infrastructure, reclaiming rural land that has been lost to environmental degradation, shoring food safety mechanisms, expanding agricultural mechanization, and increasing the use of agricultural technology in order to improve yields have all been stated as clear priorities. The plan also recognizes the continued need to invest in rural areas of the country, so that China’s remaining farmers can earn a reasonable living and adequately invest in their children’s future within and beyond the farm sector.

In addition to investing domestically, China is significantly increasing its investment in agriculture abroad. According to a United States Department of Agriculture 2018 report, “1,300 Chinese enterprises had overseas investments in agriculture, forestry, and fisheries valued at $26 billion in 2016. The investments include crop and livestock farming, fishing, processing, farm machinery, inputs, seeds, and logistics in over 100 countries.” These investments have primarily been focused in the regions of Southeast Asia, Russia’s Far East, Ukraine, Africa, Australia, and New Zealand.

China’s Agriculture under Mao Zedong

Paddy Field Plougher near Inle Lake Myanmar (Burma)

When the PRC was founded in 1949 its new leaders continued to support a policy of agricultural self-reliance. This agricultural policy was driven by Mao Zedong’s view that the post-World War II order, with its corresponding American ascendancy, was potentially aggressive and imperialistic. Under this view dependency on grain imports risked making China vulnerable to having its food needs being turned into a weapon against it. In addition, Mao wished to use his country’s limited foreign exchange resources to purchase industrial plant and equipment rather than food, aiming for rapid industrialization. Indeed, until the famine caused by the Great Leap Forward (1958-1961), China exported grain to the Soviet Union in order to purchase plant and heavy equipment, at the expense of providing adequate per capita calories for its citizens at home.

Agriculture thus became the basis on which China’s planned economy was built. As China transitioned to a planned economy, the Communist planners began to underprice farm products relative to heavy industrial goods. This was because the planners were trying to ensure that the industrial sector produced high profits which could be plowed back into industry. To keep industrial profits high, costs had to be kept low; the most easily affected cost was labor. In order keep wages low, food needed to be cheap. Thus, farming became the key to the success of the entire Chinese planned economy. To achieve China’s goals, soon after he took power in 1949, Mao orchestrated the largest act of expropriation in world history. Approximately 200 million acres of land were taken from wealthy landowners and redistributed to nearly every peasant family in China. An estimated two million landlords lost their estates, sometimes through violence and almost never with compensation. Mao soon undercut this mass creation of private land ownership by implementing socialist policies of collective agriculture. The launch of the First Five Year Plan in 1953 saw farmers organized into cooperatives where they pooled their land and shared the proceeds. Under the collective structure, each farmer kept title to his land and was paid both labor wages and a dividend based on the value of the land contributed to the collective. After some success under the cooperative model, Mao went further. In 1958, Mao began to move farmers into communes to gain greater control of agricultural output. Mao believed that communes would generate greater farm output as it allowed an increased usage of irrigation and mechanization. As an added benefit, the surplus farm labor that would theoretically be created by collectivization could then be redeployed into the rural and urban industrial sectors. He also believed that healthcare and education for the rural citizens could be more easily delivered in a collectivized environment. Just as importantly, communes would be an effective platform for mass political indoctrination. Mao’s communes pursued a “grain first policy” in which basic crops such as rice, wheat, and corn were planted regardless of the suitability of the soil and other conditions. The shift to communes eliminated household farming, except on small family plots, and all land ownership transferred to the state.

As a result of Mao’s policies, from 1952 to 1978, China increased industrial production as a percentage of national income from 19.5% to 49.4%. Grain production rose by 86%, an average annual increase of 2.5%. However, grain production increased at a rate about equal to him population growth, meaning that average grain output per capita stayed roughly steady during this period. China also increased the production of cash crops by 16%. Up until 1960, China exported grain, peaking at 5 million tons in 1958. After the famine of the Great Leap Forward, China began to import grain, yet these imports averaged 1.6% of total consumption, meaning that China was almost completely self-sufficient in food under the planned economy.

These statistics, however, are deceptive. Much of Mao’s industrial development was inefficient. Poor economies of scale, inadequate transport, and poorly skilled labor meant that China’s huge industrial investment generally failed to effectively build upon China’s existing industrial base, although its development of human capital skills and rudimentary infrastructure did lay the foundations for broader industrialization during the Reform Era. Throughout the socialist period, Chinese consumers remained on strictly rationed diets consisting primarily of coarse grains. Most consumers were deprived of daily access to cooking oil, sugar, meat, and vegetables for extended periods. In the 1970s, despite increases in grain production, urban residents ate an average of 2,328 calories per day, while rural intake was even lower at 2,100 calories daily. Average grain output per capita remained virtually unchanged and the absolute poverty rate hovered between 30% and 40%.

The primary weakness of communes was the absence of incentives. Farmers did not keep produce from their lands, which undermined their work effort. Instead, commune members were given work points based on tasks; these points were converted to grain and cash pay-outs at the end of each crop year. Free riding and an inability to monitor agricultural labor became endemic. Output also suffered because decision-making was concentrated in the hands of collective leaders who themselves were frequently following dictates from above, stifling any prospect for innovation. The pricing during this era also did little to encourage the efficient production or allocation of goods and services. Additionally, agricultural inputs such as fertilizer were in constant short supply. Because of the hukou housing registration system (which, while more relaxed, remains in force today), farm labor had no opportunity to move from agriculture to industry as the hukou system completely restricted the mobility of China’s people. This entrapment of Chinese villagers in rural areas effectively designated them as second-class citizens.

Agriculture during the Reform Era

After 1978, a series of reforms was introduced into the rural sector to improve its economic performance. One step was to de-collectivize Chinese farmers into what was termed the Household Responsibility System, where the government leased agricultural land to households. The government then raised the prices that farmers would receive by 41% for grain and by around 50% for cash crops for any farm output farmers produced above mandatory quota deliveries. Initially, the state purchased all grain sold by farmers above quotas. Eventually, private agricultural markets were re-established. Greater freedom of choice was allowed in terms of the types of crops cultivated. Fertilizer and new high-yield seed usage became more widespread. The result was a surge in agricultural output. Grain output swelled from 304.8 million tons in 1978 to an estimated 650 million tons in 2018.This growth reflected a significant rise in crop yields as grain sown area has increased at a smaller rate than crop yields. In 1978, China had approximately 120.6 million hectares under plow; in 2017, this figure increased to approximately 135 million hectares. Overall, it is China’s stated goal to maintain cultivated land at around 124 million hectares. Rising crop yields have resulted in grain price reductions. Since 1978, maize prices decreased 33% and wheat 45%. Coupled with rising incomes, these decreases meant that grain, as a percentage of rural and urban household consumption, fell from 40% and 20% respectively in the late 1970s to about 14% and 3% in 2004. These higher yields and lower prices have resulted in more food per capita. Per capita caloric intake rose from 2328 calories per day in 1980 to an excess of 3,000 calories per capita per day by 2008.

Additionally, since 1978, China’s agricultural output became significantly more diversified. Chinese farmers have moved into labor-intensive cash crops such as aquaculture, cotton, edible oils, fruits, and vegetables. Between 1978 and 2007, for instance, crop farming went from 80% of agricultural gross value output to 50.4%, while animal husbandry and fisheries increased from 16.6% to 42.1%. Between 1990 and 2004, China’s vegetable output expanded so quickly that China added the equivalent of California’s vegetable industry every two years in, and orchards now cover over 5% of China’s farmed area, double the share of any other major agricultural nation. As a result of this diversification, the Chinese diet has come more varied. Most Chinese households consume a more varied diet adding meat, poultry, fish, eggs, a variety of vegetables and dairy produce to their diets.

Maintaining Grain Yields – Water and Pollution Challenges

Throughout this period of reform, China maintained its policy of grain independence, never importing more than 5% of its grain needs. As stated in China’s 13th Five Year ensuring basic self-sufficiency of grain and absolute security of stable food remains a clearly stated goal. That said, with 19% of the world’s population being supported by approximately 9% of its arable land, this goal remains challenging. This means that China does not have a comparative advantage in land intensive products such as grain. Moreover, China’s population will continue to rise until around 2035, meaning that China will need to increase yields in order to maintain current grain per capita levels. Furthermore, as China continues to urbanize, more of its usable land will be refashioned into cities and supporting infrastructure. Additionally, pollution, soil erosion and desertification continue to negatively impact the agricultural land that is available. As a result, it is estimated that by 2050, the total demand for arable land will outstrip supply by more than 12%.

Part of the reason that China achieved such high grain production over the last two decades was yield improvements driven by the use of new high-grade seed varieties and by massive inputs of chemical fertilizer. Yet further benefits from these inputs are beginning to diminish. In 1975, total fertilizer usage was 5.5 million tons, but this rose to 47.7 million tons by 2005. China’s per hectare fertilizer usage was second only to Japan in the 1990s. Overall, it is estimated that China uses 30% of the world’s fertilizers and pesticides on 10% of global farmland. Fertilizer saturation is such that previously good or excellent soils are cresting, hardening and becoming devoid of organic material such that further application of fertilizers is leading to diminishing crop yields as well as causing considerable environmental problems such as eutrophication and particle pollution in the air. Yield benefits from the extensive use of plastic are also plateauing. Finally, large-scale deforestation has led to soil erosion.

Water shortages and water pollution may also limit future yields unless China is able to implement significant reforms in its water management. China’s freshwater of approximately 2156 m³ per capita is less than one third of the world average. This is projected to decrease to 1875 m³ by 2033. Water shortages are expected to worsen as current water demand is still relatively low at 461 m³ per capita compared with the world average of 645 m³, but this number is projected to reach 665 m³ by 2030. Water shortages will be worse in the arid and semi-arid areas in China’s northern plain from which much of the future grain output growth will be generated. In addition to water shortages, problems with irrigation system will also stymie yield growth. During the Mao-era, irrigated area tripled. Since de-collectivization, the irrigation system has deteriorated. With the reversion to family and commercial farming, control of the irrigation system has fragmented, and it is harder to mobilize mass labor for maintenance and construction. The introduction of water fees in the 1980s was designed to encourage more efficient water usage, but the fees were not sufficiently high to have the desired effect. Water designated for agricultural usage continues to be subsidized at a far higher rate than it is for industry and household use, and raising agricultural water fees remains politically difficult. Moreover, the collection of water use data remains imperfect, thus further challenging China’s ability to effectively price water used for agricultural purposes. Going forward, increasing water charges it is likely to be an essential step to dealing with China’s water shortages.

As water becomes increasingly scarce, the agricultural sector will continue to compete with the industrial sector and with households for scant water resources. According to the Ministry of Water Resources China now uses as much as 60% of the water running in many of its rivers, including the Liao and Yellow Rivers, and as much as 90% of the Huai River. China has increasingly turned to aquifers and lakes to meet water demands no longer satisfied by rain and river water alone. Groundwater now provides potable water for nearly 70% of China’s population and irrigation for approximately 40% of its agricultural land in China’s dry northern and northwestern regions. Nationally, groundwater usage has almost doubled since 1970, and now accounts for almost 20% of China’s total water usage.

Due to an uneven distribution of water resources between the north and the south of China, aquifers are especially important in China’s north, where farmers have been relying heavily on groundwater resources to increase agricultural yields. Yet China is now draining its aquifers at an unsustainable rate. At current rates of depletion, the World Bank estimates that China’s northern aquifers could effectively run dry in as little as 30 years or less. China’s northern megacities now rely on underground water sources for two-thirds of their needs. For example, in Hebei province, which surrounds Beijing, aquifer levels are dropping by approximately 3 meters annually, forcing the digging of ever deeper wells. These deeper wells in turn increase both the risk of both saltwater and arsenic intruding into the water supply and likelihood of land subsidence. With aquifers and rivers suffering from overuse, lakes are also diminishing. The province of Hebei, for instance, has already lost a staggering 969 of its 1052 lakes. While China’s ‘Water Pollution Prevention & Control Action Plan’ has establish targets to restrict ground water extraction and groundwater pollution by 2020, water restriction measures have both proved unpopular and hard to enforce.

Pollution is also challenging China’s agricultural output. China’s use of coal that is high in sulfur and heavy metals to power many of its electricity plants. The pollution from these power plants combined with additional industrial and agricultural pollution contaminate both China’s soil, air, and water. In the north, for instance, the same northern provinces that accounted for 55% of China’s farmland also hold 86% of its coal reserves yet have just 16% of China’s water resources. In the south, over 50% of China’s rice is grown in provinces which account for 52% of its arsenic, 58% of its mercury and 72% of its chromium discharges.

Maintaining Future Grain Yields – Small Farms

China’s future yield growth is also hampered by the small area plowed by each farmer, averaging .65 hectares or 1.6 acres. While de-collectivization from large communal plots to small family farms initially led to a surge in output growth, the segmentation of communal plots is now proving a constraint on grain yields. It has been estimated that increasing farm sizes could increase grain output by as much as 70 million tons annually. Small farm sizes restrict growth by preventing farmers from capturing economies of scale that could be derived from greater mechanization, from the more efficient dissemination of new seed technologies and from the improved maintenance of irrigation structures. Small farms also make it more challenging for farmers to participate in modern supply chains, to offset market volatility and to adapt to climate change, Additionally, small farms tend to use fertilizers and pesticides inefficiently. Research by Nerissa Hannik found that a 1% increase in farm size was linked to a .3 and a .5% decrease in fertilizer and pesticide use per hectare, respectively. Excessive use of fertilizers and pesticides in turn pollute soil and water which in turn depresses crop yields.

Small farms drive down rural incomes. As approximately 35% of Chinese workers or about 311 million people were employed in agriculture in some form in 2017, the impact on rural incomes is significant. In 2018, the annual per capita disposable income of urban and rural households in China was 39,251 and 14,617, respectively. Reduced rural economic opportunity in turn dis-incentivizes younger and more educated workers from pursuing a career in agriculture As a result, the average age of the Chinese agricultural worker is higher than the age of Chinese workers generally and is increasingly less educated than his urban counterpart. Older, less educated farmers could cause structural stagnation in the agricultural sector.  Such farmers may fail to adopt new technologies, innovate, and adapt to changing market conditions.

The fact that farmers lease – as opposed to own – their land has also worked to constrain grain yield by discouraging long-term investment and growth in land size. Individuals cannot privately own land in China but can acquire transferable land-use rights for some number of years. Currently, for example, land-use rights for residential purposes is 70 years. All farming or rural land is owned by rural collectives which distribute contract rights for plots of farmland to eligible households. The first leases issued in 1983 were for a duration of 15 years. These were renewed in 1997 for 30 years and again in 2017 for an additional 30 years. As part of its land-use contract, Chinese farmers have the right to decide which crops to plant, to keep all agricultural proceeds, and to sublease their land to others for agricultural production. Chinese farmers are prohibited from using contracted land for non-agricultural purposes, to leave their land fallow for more than two years or to legally oppose the government if it decides to acquire the property for development purposes. To help improve rural household stability, in 2003, China passed the Rural Land Contract Law. The law endeavors to improve the security of land tenure, to clarify the transfer and exchange rights of contracted land, and to permit family members to inherit land during the contracted period. Above all, the law reflects the government’s attempts to allow those staying in farming to gain access to additional cultivated land and to increase their incomes and competitiveness. It strives to encourage farmers to use the land more efficiently.

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Working against government efforts to improve plot size, however is the belief by some Chinese leaders that family farming provides at least nominal proof that China is still communist as its land is not privately held, and as its land is relatively equally distributed. Many Chinese leaders also believe that agricultural land provides a social security system for its population, as every rural family is theoretically only one season away from being able to feed itself.

That said, the fact that the government no longer plays a significant role in agricultural production. Aside from restrictions on land ownership, China today has one of the least distorted domestic agricultural economies in the world. Most grains, oilseeds, and fiber crops, and all horticultural and livestock products are sold to small private traders who compete in efficient and integrated markets with minimal regulation.

Insuring Safe Food

In 2008, Chinese domestic milk and infant formula was found to have been purposely tainted with melamine, sickening 300,000 babies, and killing six. Other food scandals include contaminated pork, fake eggs, gutter oil, and counterfeit foods mislabeled as brand name or organic products. These scandals have caused many Chinese to express serious reservations about the quality of domestic food sources and to call for industry reform. The 13th Five Year Plan addressed these concerns by committing to upgrade agricultural standards and to ensure the quality and safety of all food products over the entire journey of agricultural products from farm to table.

In May 2019, the Chinese Communist Party reinvigorated this goal when China declared that it would be stepping up its enforcement of food safety legislation as part of the Communist Party’s campaign called “Staying True to Our Founding Mission”. Between June and December 2019, its increased efforts have resulted in the identification of 70,000 food safety violations, culminating in the suspension of over 2400 food manufacturers and the meting out of approximately $130 million in fines. Additionally, China is increasingly implementing technologies such as sensors, artificial intelligence, and block chain IDs to improve the traceability of food products from farm to table. Other measures include increased supervision with more random checks and the tightening of food safety standards. By 2035, it is China’s goal to have in place world-leading food safety standards and globally advanced risk control capabilities.

GMO in China

Genetically engineered or transgenic organisms, also known as genetically modified organisms (GMOs), were first made available to US consumers in 1994. By 2014, approximately 28 countries sowed GM crops on more than 181 million hectares, equaling 13% of the world’s arable surface. GM soybeans, cotton, maize, oilseed, and rape account for approximately 82%, 68%, 30% and 25% of the total planted area for these crops, respectively. In 2015, the United States Food and Drug Administration authorized the first genetically modified animal for human consumption.

Advocates of GMO food note that such crops could help the world adopt to changing climatic conditions including drought, cold and soil salinization. Additionally, by genetically coding in natural pesticides and other disease-resistant characteristics, GMO foods also offer the opportunity to fight off pests and diseases while correspondingly lowering the use of pesticides. Crops can also be modified to increase crop yields. Among their many concerns, opponents of GMO foods note that the long-term health consequences of consuming GMO food have yet to be determined. Additionally, opponents fear that GMO plants will diminish biodiversity by contaminating wild species.

Despite the risks of GMO plants, China’s 13th Five Year Plan sets as a goal to develop a modern seed industry, including the development superior seed varieties, and cultivation breeding-promotion operations. In January 2020, the Chinese government stated that genetically modified corn, cotton, and soybean species had passed biosafety evaluations, inching the country closer to commercialization of new GMO food sources. These crops were modified to be more resilient against disease and pests. On paper, China has approved biotech cotton, papaya, tomatoes, sweet peppers, petunias, and poplar trees. However, commercialization has been allowed only for papaya and cotton.

In 2018, the global market value of GM crop seeds was $20.1 billion and is expected to grow to $30.2 billion by 2026. As one of the world’s leading countries in the research and development of agricultural biotechnology, China’s issue of bio certificates for soybeans, cotton and corn indicates its interest in capitalizing on its billions of dollars of investment in the field, including its $43 billion purchase of the Swiss pesticide giant Syngenta in 2016. Not only would China benefit from commercializing its GMO seeds to sell globally, but many studies have indicated that China would also enjoy substantial economic benefits from the cultivation of GMO food crops domestically.

The commercialization of China’s GMO technology has been hampered, however, by the Chinese public’s negative attitude toward GMO crops. As per a 2010 online survey interviewing 50,000 people, about 84% of respondents said that they feared GM foods for safety reasons. A 2018 nationwide survey found that those views had not substantially shifted with 46.7% of respondents expressing negative views of GMOs and with 14% considering GMO products to be form of bioterrorism targeting China.

The Chinese public’s disapproving views concerning GMO products likely originate from their experience of the various food scandals that have plagued the country. This adverse experience has likely also negatively impacted their views of genetically modified foods. Exacerbating their concerns has been the discovery that GMO food products have already been farmed illegally in China. In 2014, China Central Television (CCTV) tested five bags of rice from a Wuhan supermarket in Hubei province, and discovered that three of the five samples had been grown from genetically modified seeds. In the same year, illegal large-scale planting of GMO rice and corn in four provinces were reported. In 2016, it was revealed that 93% of corn from Liaoning province demonstrated traces of GMO contamination. In response, the government destroyed crops, confiscated illegal seeds, and prosecuted perpetrators.

The Chinese government is now working to change Chinese opinion regarding GMO products. Given what is at play, the stakes could not be higher. Not only has China made massive investments in the technology that it now wants to commercialize, but water shortages, climate change and its growing population will continue to place unprecedented pressure on its food supply. GMO products can help China adapt to these challenges. GMO crops should also enable China to reduce its extremely high use of fertilizers and pesticides which in turn will have positive impacts on its environment and food supply.

The Automation of Agriculture

While the percentage of the Chinese workforce involved in farming has decreased from 55% in 1991 to 18% in 2017, approximately 250 million Chinese still work as farmers. However, as China’s rural young becomes increasingly educated, and as China’s economy continues to expand, many are migrating to urban areas seeking better opportunity. As a result, approximately 60% of people working in Chinese agriculture are over 45 years compared to just 14% of farmers who are less than 35 years. This decline in farm labor is projected to increase over the coming decades even as China’s population is projected to continue to grow through 2035. Contemporaneously, China’s population is expected to become wealthier. Growing wealth correlates with a rising consumer demand for greater food variety and for more animal-based proteins. The water footprint per calorie pulses, eggs, chicken, pigs, sheep, and beef is 2.5, 2.0, 2.6, 3.6, 5.3, and 9.4 times larger than grains, respectively. This increase in water per calorie will further stress China’s polluted and limited per capita water supply.

AgridronesChina is answering these challenges by significantly investing in agricultural technologies including artificial intelligence, big data, robotics, and automation.   Not only will these technologies help improve the efficiency and sustainability of China’s agricultural market, but they also represent a big and rapidly growing global business. The market for global agricultural robots, for instance, is projected to exceed $20 billion by the end of 2025, with growth in precision agriculture as a major driver. Artificial intelligence, automation, big data, and robotics are expected to find applications in everything from herding and fish farming to planting and harvesting. Other uses include seeding, irrigation, water leak detection, fertilizing, crop weeding, spraying, crop monitoring and analysis, disease and pest identification and eradication, thinning and pruning, and tracking the growth of plants. In addition to robotics, drones are also increasingly being used to monitor crops, conduct field analysis, manage livestock, plan interrogation and crop spraying. Drones aid farmers to see the big picture of their farmland and to make educated decisions that help to maximize crop yields.

Improving agricultural sustainability is another factor motivating China’s adoption of agricultural technology. China’s farming industry has a significant carbon footprint, with Chinese farmers using 30% of the world’s fertilizers and pesticides on 9% of global farmland. In addition to developing drones and robots that can help to reduce fertilizer and pesticide needs, Chinese scientists are also turning to big data to determine best farming practices. Over 20 million farmers have since benefited from China’s big data research; it is estimated the findings have enabled farmers to increase yields while slashing fertilizer use generating total financial savings of an estimated $12 billion.

China’s Growing Presence in Agriculture Abroad

In the coming decades, China will face of an increasing divergence between demand for food and its ability to produce that food domestically. This divergence is driven by factors such as a population that will continue to grow through at least 2035, a more wealthy population that is demanding a more varied and a more meat-based diet, and limited and polluted land and water resources. As a result, China is increasingly looking to international markets to meet its food shortfalls.

According to the United States Department of Agriculture’s 2018 report, in 2016 an estimated 1,300 Chinese enterprises had made overseas agriculture, forestry, and fisheries investments in over 100 countries. These investments were valued at approximately $26 billion. The investments were placed in a variety of sectors including land purchase, land leasing, seeds, farm inputs, farm machinery, food processing, farm logistics, farm machinery, livestock farming, and fish farming. China’s National Bureau of Statistics noted that Chinese investment in foreign farming, forestry, and fishing grew fivefold from 2010 to 2016. Many of China’s agricultural investments are now made in conjunction with its China’s Belt and Road Initiative.

As has been the case in other foreign investment sectors, China’s government has supported this international investment by favorable lending, brokering deals, formulating strategic plans which support low-cost bidding, and providing Chinese agricultural investors with training and information services. China subsidizes these investments for both political and economic reasons. Economic aims include the continued growth of the Chinese economy, securing access to raw materials, the expansion of exports, helping Chinese companies garner a larger share of profits from imported commodities, creating new markets for Chinese products, enabling tariff-free access to developed markets, shifting some of Chinese domestic manufacturing and domestic agriculture overseas, providing domestic companies with international experience, food security, gaining and imparting technical and managerial experience, and exerting influence on global prices. Political objectives include the preservation of the Communist Party rule, reestablishing China’s place as a leading world power, the promotion of multi-polarity, countering US hegemony, increasing Chinese influence in multinational institutions such as United Nations and World Bank, strengthening its alliances with other countries, particularly in the Third World, preventing Taiwan independence, and projecting political influence abroad.

Future Trends

There will be several trends to watch for in the Chinese agricultural sector in the coming decades. Firstly, China will make every effort to maintain its agricultural yields and its food self-sufficiency. Despite its rapid rate of urbanization, China is committed to maintaining a baseline for cultivated land area at 124 million hectares. It is investing heavily in agricultural research to increase yields and is launching a campaign to win public support for the introduction of more GMO crops.

China is also committed to increasing the sustainability of its agriculture and the safety of its food supplies. China is investing heavily in big data, drone technologies, artificial intelligence, and automation to reduce its use of pesticides, fertilizer, and water. Upgrading antiquated and leaking irrigation networks is a high priority. China is also using technology to start tracking its food as it journeys from farm to table; therefore, when food safety breaches arise, it can more effectively follow the breach back to the source. China will also continue to improve its food safety both through increased inspections, and better safety practices and standards.

China will also carry on investing in international agricultural, livestock and aquaculture food chains. These investments will help China ensure reliable and secure overseas food resources. They will also help to increase global food production overall, therefore helping to keep in check global food prices.

Finally, as the number of Chinese working as farmers further declines over the coming decades, China will likely begin to amalgamate its millions of small farms into increasingly larger parcels. Increasing farm sizes will free labor to work in areas which will provide China a higher return on labor capital.  Larger farm sizes will also increase productivity by creating more opportunity for mechanization, and by reducing demand for farm inputs such as pesticides and fertilizers.

References

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Population Power: China’s Shifting Masses

Introduction

China’s enormous population is one of the country’s most defining features. With the largest population in the world, almost one-fifth of the global total, it factors into nearly every significant issue facing the country including employment, consumption, the environment, and migration. In the 1970s, faced with the prospect of its population outstripping its economic and agricultural output, Beijing reversed early Maoist policies encouraging population growth. China’s 1970s aggressive fertility education programs and its 1980 “One-Child Policy” succeeded in reducing births per woman from their peak of 5.8 at the beginning of the 1970s to approximately 1.6 in 2019. The success of China’s population control policies has had unexpected disadvantages including a male/female sex imbalance, a rapidly aging population and a shrinking labor force. In 2016, such difficulties caused China to change the One-Child Policy to a Two-Child Policy.  Nevertheless, despite policy changes and China’s declining numbers, China’s large population still poses significant challenges for the country.

Global Population Trends

Understanding global population trends brings context to China’s individual demographic numbers. According to the United Nations 2019 Population Report, the global population is expected to rise from 7.7 billion in 2019 to approximately 10.9-11.2 billion in 2100.  By then, approximately 81% of the world’s population will be living in Africa and Asia.

 

UN Population Statistics – Geographical Regions  
Regions 2019 2019 2030 2030 2050 2050 2100 2100
World       7,713       8,548       9,735     10,875
Sub-Saharan Africa       1,066 14%       1,400 16%       2,118 22%       3,775 35%
Northern Africa and Western Asia           517 7%           609 7%           754 8%           924 8%
Central and Southern Asia       1,991 26%       2,227 26%       2,496 26%       2,334 21%
Eastern and Southeastern Asia       2,335 30%       2,427 28%       2,411 25%       1,967 18%
Latin America and the Caribbean           648 8%           706 8%           762 8%           680 6%
Australia/ New Zealand             30 0.4%             33 0.4%             38 0.4%             49 0.5%
Oceania             12 0.2%             15 0.2%             19 0.2%             26 0.2%
Europe and North America       1,114 14%       1,132 13%       1,136 12%       1,120 10%

 

Sub-Saharan Africa will experience the greatest growth. As a proportion of global population, between 2019 and 2100, the region will increase from 14% of the total or 1.1 billion people to 35% or 3.8 billion. Between 2019 and 2050, the world’s 47 least developed countries will grow the fastest, with many countries doubling in size. Of the 2019-2050 expected increase of 2.1 billion people, half the increase is projected to be driven by just nine countries: India, Nigeria, the Democratic Republic of the Congo, Pakistan, Ethiopia, the United Republic of Tanzania, the United States, Uganda and Indonesia.

Sub-Saharan Africa

As a proportion of the global total, the rest of the world will experience flat or decreasing population levels. Flat-growth regions include North Africa and West Asia which are projected to grow from 7%-8% or 527 to 924 million people between 2019 and 2100. Oceania will stay steady at .2% or 12 to 26 million people. Australia and New Zealand will grow from .4%-.5% or 30 to 49 million people.

 

Those with shrinking populations between 2019 and 2020 include Europe and North America which will decline from 14% to 10% of the global total, holding steady at approximately 1.1 billion. Latin America and the Caribbean will drop from 8% or 648 million to 6% or 680 million people. Central and Southern Asia will drop from 26% or 2.0 billion to 21% or 2.3 billion people. Eastern and Southeastern Asia will decrease from 30% or 2.3 billion to 18% or 2.0 billion people. In Europe, the population is expected to peak in 2030 at 510 million and then decrease to 465 million by 2100.

In 2019, China at 1.4 billion and India at 1.3 billion accounted for 37% of global population. In 2100, China at 1.1 billion and India at 1.45 billion will drop to 23% of the global total. By 2024, India is forecasted to overtake China to become the world’s most populous country.

Rapid worldwide urbanization is a big driver in the decreasing fertility rates seen in most regions.  In 2019, approximately 55% of people worldwide lived in cities. By 2050, the percentage increases to 68%, and by 2100 to 84%. Urbanization places downward pressure on birth rates because children that were once useful as farm labor become burdens in cities where they need to be educated and trained in order to be economically productive. Additionally, urban women have better access to education, healthcare and work opportunities, all of which make them less inclined to have large families.

Worldwide, in most countries where populations are declining, people are also quickly aging. In 2100, the number of people 60 years or over is expected to grow to 28% of the total population, from 1.0 billion to 3.1 billion people. The number aged 80 or over will increase to 8%, from approximately .1 billion to .9 billion people. Correspondingly, the global fertility rate is expected to drop from 2.5 in 2019 to 1.9 births in 2100. The global fertility rate is expected to fall below the replacement fertility rate by the year 2070, with the replacement fertility rate being the level of birth that each female is required to have to keep up with the population size. This aging population is expected to affect everything from economic demand to social safety nets.

Emigration and immigration are also impacting population levels in some countries. Countries such as Bangladesh, Nepal, the Philippines, Syria, Venezuela, and Myanmar have seen over 1 million of its citizens emigrate since 2010, either in search of work opportunities or to escape war or internal domestic conflict. Conversely, since 2010, over 36 countries have welcomed over 200,000 immigrants.

China’s Population Trends

China is experiencing rapid demographic change that mirrors many global trends. As is happening in many East Asian countries, China’s population is declining both in absolute numbers and as a percentage of the world total. According to UN statistics, in 2019, China’s population was approximately 1.434 billion people or 19% of the global total. By 2035, China’s population is expected to peak at 1.461 billion people or 16%. By 2050 and 2100, China’s population will reduce to 1.402 billion or 14%. and 1.064 billion or 10% respectively. Currently, the fertility rate of China is 1.55 births per woman.

China’s population faces a significant sex imbalance. In 2019, there were approximately 37 million additional males to females, with males accounting for 51.30% of the total.  While the absolute number of additional males is forecasted to decrease, as a percentage of China’s total population, males will continue to outnumber females through 2100. By 2050, for instance, China will have 24 million more males than females, with males accounting for 50.87%. By 2100, males still exceed females by 25 million or 51.15% of the total.

China’s population is also aging rapidly. In 1980, China’s population aged 50+ was 14% of the total, with people aged 75+ accounting for just 1% of those in the 50+ category. In 2019, China’s population aged 50+ increased to 32%, with people aged 75+ accounting for 3% of 50+ category total. By 2050, China’s population 50+ surpasses 47%, with 14.1% of this group aged 75+. By 2100, this group exceeds 49%, with 20% of this group being 75 years or older.

UN Population Statistics – China – By Age Category  
Age Demographics 1980 2020 2050 2100
0-14 35.9% 17.7% 14.1% 13.8%
15-49 49.7% 49.5% 38.7% 36.6%
50+ 14.4% 32.8% 47.2% 49.6%
75+ 1.2% 3.7% 14.1% 20.0%

China’s Population Post-1949

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For the best part of two millennia, China had been the most world’s populous country. In the early 1800s, for instance, one-third of the world population was Chinese. While still having the world’s largest population in 1950, between 1850 and 1950, high death rates caused by disease, crop failure, natural disasters, and war restrained China’s population growth to 0.3% per year. In 1949, after the Chinese Communist Party (CCP) victory in the Chinese Civil War, early CCP policies led to improvements in nutrition, sanitation and increased access to healthcare. Chinese mortality rates, especially those of infants, plummeted and the population began to grow rapidly. Initially, China’s leader, Mao Zedong, considered a large and rapidly growing population to be a positive asset. More people meant more workers to aid in economic development. More people meant more soldiers to ensure Communist domestic control, to secure China’s international borders and to prosecute war. Mao believed that Malthusian theory –the principle that exponential population growth can lead to an inability to feed the population – was a capitalist paradigm that did not apply to Marxist production methods where more people created more economic output.

As a result, China’s population continued the tradition of seeking as many sons as possible. According to U.N. statistics, between 1950 and 1980, China’s population almost doubled, increasing from 554 million to just over 1 billion. Officials in China were aware of China’s exploding population in the decades after 1949. Yet, any talk of population control or family planning was labeled as defeatist.

By the end of the 1960s, concerns regarding China’s exploding population began to be more discussed more openly. In 1970, Beijing decided to implement a voluntary birth control system. The government made contraceptives more widely available and educated the public on new government family planning policies with slogans promoting “later marriages, longer birth intervals and fewer children”. The program was largely successful. China’s total fertility rate, which measures the average number of births per woman, plummeted from 5.8 in 1970 to 2.7 in 1978. A 1980 study, undertaken to determine what would be China’s ideal population in 2080, assuming significant modernization and economic growth, concluded that the optimum level was between 650 and 700 million. As China’s population in 1980 had already exceeded 1 billion citizens, the government decided to implement more draconian population control measures.

The ‘One-Child’ Policy 

In September 1980, China launched the One-Child Policy. Family planning was written into the constitution two years later. The policy was not implemented uniformly across the country. Most ethnic minorities were permitted to have two children and many Han living in rural areas could have a second child if the first child was a girl. Additionally, parents whose first child was disabled could have a second child. Nevertheless, by the late 1990s, China’s total fertility rate fell to between 1·5 and 1·7 where it has remained.

The One-Child Policy was implemented relatively easily in the cities, where both spouses often worked and where living conditions were cramped. Resistance in the countryside was greater. The rural desire for larger families and many sons has been deeply rooted, not least because more hands make agricultural work easier for all. In general, there has been a high correlation between higher income and the willingness to accept the One-Child Policy.

One result of the policy has been greater incidences of forced sterilizations and abortions (Short, 2000). More commonly, couples defying the One-Child Policy were subject to fines, loss of jobs, reduced wages, loss of work unit benefits or, in some cases, loss of bonuses for the entire workgroup. In some areas, relatively wealthy families who worked in the private sector were able to pay the fines imposed. Those working in the public sector did not have this freedom as a second child usually meant a loss of employment. Others did not report females at birth. Unregistered girls were at risk of losing access to many legal benefits, including education and other forms of social welfare. It is not clear exactly how many unregistered girls were born in China since 1980, but research by John Jay Kennedy at the University of Kansas estimates that 10 million undocumented girls were born from 1980-2010.

The One-Child Policy has also led to an imbalance in the male/female sex ratio. In 2019, there was an estimated 37 million more men than women. Termed “Bare Branches” in China, these men are statistically unlikely to find partners in a society where universal marriage is the norm; 99.5% of Chinese women and 97% of all Chinese men marry.  Men who do marry tend to be those with higher incomes, better educations and higher-value assets, including an apartment, house or car. Surplus men tend to be concentrated in rural villages that are poverty stricken. Those men unable to find wives statistically are more likely to engage in prostitution, social unrest and crime.

A benefit of this imbalance has been a greater trend toward gender equality.  Historically, Chinese parents devoted relatively few resources to their daughters.  A 2018 study by Yi Zeng and Therese Hesketh found that without brothers with which to compete, there were no significant differences between single-girl and single-boy families in terms of a family’s investment in and expectation for health and education outcomes. In 2018, women made up 52% of undergraduates and 48% of postgraduates.  Having less children has also improved women’s access to well-paid work and career advancement. In 2018, it is estimated that as many as 25% of CEOs of medium and large Chinese companies are women.

China’s Rapidly Aging Population

The One-Child Policy has also contributed to China’s rapidly aging population. In 1980, China’s population aged 50+ was 14% of the total, with people aged 75+ accounting for just 1% of those in the 50+ category. In 2019, China’s population aged 50+ increased to 32%, with people aged 75+ accounting for 3% of 50+ category total. By 2050, China’s population 50+ surpasses 47%, with 14.1% of this group aged 75+. By 2100, this group exceeds 49%, with 20% of this group being 75 years or older.

 

china population 2100

This rapidly aging population will place a great burden on the younger segments of society as the elderly dependency ratio increases sharply. The elderly dependency ratio is defined as the number of people aged 65+ years divided by number of working-age people aged 18–64 years. As dictated both by Chinese culture and by Chinese law, Chinese children are obliged to care for their retired parents. The strain of caring for the elderly is expected to be more significant in the countryside. The elderly in rural areas generally enjoy a less robust social safety net compared to those living in in urban areas. On average, rural lifetime incomes are less as well, leading to lower retirement savings. Rural elderly are also more vulnerable to living alone, as many rural children have migrated to cities to find work. Rural empty-nesters, especially those living alone, are more likely to suffer mental health, financial and other problems.

The Two-Child Policy

Because of these negative population trends, in January 2016, China’s One-Child Policy changed to a Two-Child Policy. For the first time in 36 years, no one in China is limited to having just one child. The policy was aimed at the 90 million women within the reproductive age that presently had a child and now would be permitted to have a second child. In some provinces, these policies have been supplemented by incentives such as encouraging employers to provide more services for families, to lengthen maternity leave, to offer aid to women returning to work after birth and to grant tax incentives, housing benefits and education cost deductions. Some provinces are making abortions harder to obtain and using courts to discourage couples from accessing divorce services.

Despite these efforts, the significant socioeconomic changes that occurred since the onset of the One-Child Policy have caused China to transform into a low fertility culture. These changes are consistent with the pattern countries follow as they become more developed. Studies have indicated that most Chinese rural women want 1 to 2 children compared to greater than 5 children desired in the 1970s. Most urban women continue to want only one child. Urban women’s list of reasons for their one child preference include the high cost of raising and educating children, the negative effect a larger family would have on her family’s lifestyle and her individual liberties, the greater strain more children would place on family income and the impact more children might have on a her career. Factors affecting rural fertility include a woman’s marriage age, the cost of children, income forgone for having children and the social security benefits available. The Two-Child Policy is therefore unlikely to unleash a baby boom, but rather should cause a modest increase in fertility. That said, many of the negative effects of the one-child policy are likely to disappear. These include forced abortions and sterilizations, female infanticide or abandonment and unregistered girls at birth.

The Changing Structure of the Labor Force

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Since 1980, the age structure of China’s population has provided China with an enormous competitive economic advantage. Specifically, since 1980, China’s population has been both young and relatively free of dependents, whether they are children or elderly parents needing care. In 1980, for example, 85% of its population was aged 49 years or younger, with 50% of that population falling into the 15-49 year working age bracket. In 2019, 50% of China’s population was still aged 15-49, but its total population aged 49 years or younger has decreased from 85% to 67%. China’s current low dependency rate derives from the fact that Chinese ‘baby boomers’ born in the 1960s after the Great Leap Forward, and their children born in the 1980s, are now of working age. During the 1980s, China’s working age population increased 2.5% annually; this increase, coupled with high rural-to-urban migration, meant that the overall urban labor force has grown at about 4% per year between 1978 and 2010. It is expected that between 2010-2027, the number of Chinese workers will level off and then begin to drop approximately .5% per year. This decline will mirror a rising dependency rate as the ratio of producers to total population decreases.

The historically low dependency rate has created a “demographic dividend” for China.  The demographic dividend is the economic growth potential that can result from shifts in a population’s age structure, mainly when the share of the working-age population is larger than the non-working-age share of the population.  China’s low dependency rate since 1980 has also helped drive high savings rates, as individuals tend to save when they work and then spend their savings upon retiring. This savings has provided the Chinese economy with significant investment capital which in turn has led to the creation of more jobs. China’s young, unencumbered population has also benefited China economically, as it has been more adaptable to the rapid social and economic changes that have attended China’s transition to a market economy.

In 1978, 99% of these Chinese laborers worked in government-owned enterprises. In 2014, Chinese workers are employed by a more diversified set of companies in terms of ownership structure. While 25% of urban workers still work for the government or government-controlled entities including collectives and state-owned enterprises, 43% work for privately-owned firms, and 32% are self-employed or work in the informal economy.

Going forward, the growth of China’s labor force will slow as the last baby boom cohorts are absorbed. According to UN population calculations, by 2050, 47% of Chinese people will be over 50 years compared to 33% in 2019. Between 2020 and 2050, Chinese workers – those aged between 15-59 years – will decrease by over 200 million people, an average of 7 million people annually.

To offset its diminishing labor pool, China has many tools at its disposal. A start has been the easing of the One-Child Policy. Although it is too early to measure accurately the impact of the Two-Child Policy, early research indicates that the population bump will be relatively small. Population is now expected to peak at 1·45 billion in 2029 compared with a peak of 1·4 billion in 2023. In addition to implementing the Two-Child Policy, China can continue to modernize and mechanize China’s farming. Chinese fields typically average 2.5 acres, one of the smallest averages in the world. Increasing farm size will facilitate the use of modern farming technologies. Both will create opportunities for the remaining 27% of Chinese workers still employed in agriculture to migrate to the industrial workforce. Automation and robotics can also offset labor declines and increase labor productivity. Overall, Chinese labor productivity is likely to rise in coming decades because incoming labor cohorts are more educated than their parents. China can also extend the retirement age. Currently, men retire at 60 years and women retire at 55 years.

Urbanization

Rapid urbanization has accompanied China’s economic development. Historically, China has been a country of farmers. In 1950, when the Communists took control, only about 10% of the country lived in cities. Early Chinese Communists policies reinforced this rural population bias by creating what amounted to a two-tier economic system.  Chinese urban citizens, enmeshed in danweis or urban work units, enjoyed social benefits and welfare entitlements not available to farmers housed in the rural collectives. This inequality was designed to generate rapid industrialization. Rural China was to provide low-cost food and other agricultural products to city workers who used the savings from these low-cost goods to invest in and build China’s factories.

In order to prevent peasants from migrating to seek better work and greater benefits, the household registration system (hukou) was developed which was accompanied by a system of vouchers which were required to acquire food and clothing. By the early 1960s, it became almost impossible for rural workers to obtain an urban hukou, and rural to urban migration was almost completely halted. Indeed, internal migration between 1964 and 1980 was almost exclusively from the city to the countryside as happened during the Cultural Revolution when approximately 17 million middle school graduates were sent to the country to “learn from the peasants” and as happened when workers were sent to develop industry in Western China. As a result of these measures, by 1978, only 17.92% of Chinese lived in cities.

After 1980, China began to rapidly urbanize as its economy expanded. According to World Bank statistics, in 2018, approximately 59% of Chinese live in cities or almost 850 million people. By 2030, it is estimated that 70% or one billion of Chinese will be urban residents. Some urban growth has occurred by reclassifying rural areas to urban areas, but most of the growth in the urban residential rate represents real rural to urban migration. Currently, China has 65 cities over 1 million people, and 15 cities with population larger than 10 million. According to World Atlas statistics, in 2019, Ghangzhou was China’s largest city with 44.2 million people followed by Shanghai with 36 million people.

Internal Migration and the Hukou System

To control its large population, in the 1950s, China implemented the household registration or hukou system. This system effectively tied people to the place in which their Hukou registration card was issued. Children inherited their hukou status from their parents. Besides controlling internal migration, the hukou system controlled the internal distribution of resources such as food and clothing. The hukou system prioritized urban workers over rural workers. Non-agricultural and urban residents were granted significantly better benefits including superior employment opportunities, free education for their children, free and more-advanced medical care, subsidized housing and retirement pensions. By contrast, rural residents received few benefits and were also required to sell their produce to the government at discounted rates in order to finance urban subsidies. Inferior benefits and poorer educational and work opportunities has meant that rural residents have experienced significantly less upward mobility when compared to urban inhabitants. Chinese police have also used hukou registration to more closely watch problematic citizens such as political activists or convicted criminals.

In the 1980s, agricultural reforms led to surplus labor at a time when industrial economic reforms caused the demand for urban workers to increase. As a result, China began to cautiously modify Hukou restrictions. In 1984, for instance, China created the “self-supplied food grain” hukou which allowed rural residents to live in market towns if they had local employment, housing and food. In 1992, wealthy and educated individuals could earn urban residency under the “blue stamp” hukou designation if they had significant funds to invest in urban areas.

In addition to workers migrating with new Hukou status, millions of rural Chinese have also traveled to cities illegally. Illegal migration has been facilitated by the steady reduction in the use of Hukou ration vouchers, meaning that unregistered migrants have been able to purchase food and clothing once they have reached the city. According to Chinese labor bulletin statistics, in 2018, approximately 30% of the workforce or 288 million workers are currently part of what is termed China’s floating population. Most of these migrants live on the periphery of cities often in substandard housing. They work long hours and expect to return home once they have met their financial objectives. Migrant workers tend to take jobs that urban residents are either unable or unwilling to do. Male migrants, for instance, dominate employment in sectors such as construction, while females work in textile and other factories were work is strenuous and often dull.

Migrants lack channels into urban society including access to education, housing and social services that go with full urban citizenship. In comparison to urban residents, rural people have lower educational levels and are equipped with less capital. They also suffer the economic and emotional impact of remoteness and they endure incomplete markets for many needed resources. Without access to education, many migrants leave their children behind with family members in the countryside. Typical work schedules mean that visits home occur infrequently, often just once a year.

As its floating population has grown, China has continued to address migrant disadvantages through gradual modifications of registration requirements.  This process has been implemented in starts and stops. Reforms began first in small towns and cities. Where migrants can demonstrate extended residence, secure housing and steady income, it has become easier to transfer their hukou registration. Since 2001, larger cities have also begun some limited easing of hukou restrictions. In 2014, the national government has reiterated its pledge to continue to gradually eliminate the urban registration system. Cities and towns with populations under 1 million people are now required to eliminate restrictions entirely and promptly. Cities of 1- 5 million people have been given more open-ended deadlines to meet hukou reform goals. Cities with populations greater than 5 million people can continue to restrict access to permanent registration.

Where local cities have tried to push back on allowing more migrants to formally register, they have done so by defining criteria strictly. For instance, many cities have interpreted the steady source of income criteria in a way that excludes the unskilled jobs that employ many migrants. Other cities have required educational or wealth criteria that are often not met by many in China’s floating population.

These criteria effectively keep in place the significant barriers stopping low-wage earners from being upwardly mobile. They have minimized the impact of the reform by limiting its benefits to a small part of the migrant population. Cities often support these barriers because adding migrants to the formal registration system generates meaningful educational, healthcare, housing and other social costs. Barriers also entrench urban privileges from which city officials themselves benefit, and act to keep urban populations loyal. Hukou restrictions have prioritized the economic growth of China’s urban areas over rural areas. Rural migrants subsidize urban industrial growth by providing low-cost, benefit-free labor. Hukou allows urban environments to control the numbers of such workers by preserving their option to remove illegal workers from the city when their labor is no longer beneficial.  One way that local Chinese governments have tried to mask the existence of continuing barriers is by eliminating hukou labels – rural, urban, blue stamp, etc. – while keeping in place the criteria that made the labels relevant in the first place. That said, overall, the trend is that household registration restrictions are continuing to ease even if progress is slow.

Additionally, other migrant-beneficial reforms are being promoted. For instance, there have been efforts made to rein in detrimental police practices including coercive custody and repatriation, dragnet sweeps and extortion. Other directives have stipulated that more effort should be made to educate the children of migrants working within local jurisdictions. Some local governments have tried to skirt this requirement by making education available only to those migrants who have no family members still residing in their hukou registration jurisdiction. Where education is provided, migrants often are required to pay additional fees not required by local hukou holders. These fees often represent a significant percentage of the migrant’s annual income and represent an additional income source for schools. In order to prevent the loss of these additional school fees, the establishment of private migrant schools has often been strongly discouraged.

Limited educational access is also at play when trying to gain access to colleges and universities. Competition for acceptance to local universities is fierce even if students are legal. Non-registered students are often required to achieve significantly higher test results compared to registered students when vying for the same place. By limiting labor mobility, China’s amplifies the income disparity between urban and rural residents, creating a hereditary economic barrier.

Chinese Diaspora

Chinese Diaspora or Overseas Chinese are people of Chinese birth or Chinese descent currently living outside the People’s Republic of China and the Republic of China (Taiwan). Today there are an estimated 40 million overseas Chinese living in 148 countries around the world. The majority lives in Southeast Asia. Ethnic Chinese constitute approximately 74% of the Singaporean population as well as significant minority populations in Indonesia, Malaysia, Thailand, the Philippines and Vietnam.  Historically, most came from the southern coastal provinces of Guangdong, Fujian and Hainan. In each geographical region where Chinese reside, many of the Chinese diaspora have kept their languages and cultural identity while integrating to varying degrees into their host country.

Map of Chinese Migration 1800-1949

Map of Chinese Migration 1800-1949

Chinese migration came in four waves. According to research by Poston and Wong, the first wave was characterized by merchants and traders who emigrated to create businesses abroad. The more successful their businesses, the more likely these migrants were to preserve their Chinese attributes and their connections with China. Most of these merchant migrants traveled to Asian countries, particularly to Southeast Asia before 1850. A second wave of migration occurred between approximately 1840 and 1920 when Chinese immigrated to the Americas and Australia to work as cooks, miners, laundry men and railway construction workers. Most of these immigrants were male, of peasant origin and many returned to China after working for years or decades in their host country.

Chinese emigration to America: sketch on board the steam-ship Alaska, bound for San Francisco

A third wave of migration occurred for several decades after the fall of the Qing Dynasty in 1911 and was characterized by well educated professionals. Between 1920 and 1950, many of these immigrants were teachers who traveled to Southeast Asia to educate the Chinese children of families who had emigrated previously. A fourth wave of migration occurred after 1950 when Chinese in countries such as South Asia migrated to other foreign countries.

Since 1979, approximately 4.5 million Chinese students have traveled to the United States and other Western countries to seek university education. As China’s footprint in the world expands, educational destinations have expanded with it. Overall, according to UNESCO, in 2016 over 801,000 Chinese students pursued university education overseas. A significant minority of these students have elected to remain in their host countries at least for some period after graduation. For instance, the US Department of Energy’s Oak Ridge Institute for Science and Education noted that 92% of Chinese who earned science and technology doctorates in the United States in 2002 still resided in the US in 2007. Similarly, a 2013 National Science Foundation report noted that 86% Chinese science and engineering doctorate students hoped to remain in the United States after finishing their degrees. China has tried to reverse this educational brain drain by offering subsidies and perks for student returnees. Their efforts are beginning to show effects. The rate of return of overseas Chinese rose from a low of 25% in 2005 to 33% in 2010.

In 2000, the immigration rate of China’s highly educated population is now five times as high as the country’s overall rate. It is not just wealthy and middle-class students that are traveling abroad. Increasingly, middle-class and wealthy Chinese elites are increasingly pursuing work opportunities overseas or applying for immigrant investor visas where residency is offered to wealthy foreigners in exchange for a specified sum to be invested in the host country. In 2014, for instance, Chinese citizens received 85% of all U.S. immigrant investor visas. Wealthy Chinese cite several reasons for their wish to immigrate including the wish to join previously emigrated family members, pollution, poor food safety, weak rule of law and concerns about long-term political, economic and social conditions in China.

Chinese Diaspora and Economic Advantage in Southeast Asia

China’s emigration legacy has created immense economic advantage in many of the Southeast Asian countries.  Except for Singapore, ethnic Chinese represent minority populations in Indonesia, Thailand, Malaysia, the Philippines, Myanmar, Vietnam, Laos, Cambodia and Brunei, but dominate the economic activity of their host countries. It is estimated that Chinese migrants control approximately 60% of the region’s private corporate wealth.

 

Chinese in Southeast Asia
Ethnic  
Ethnic Ethnic Chinese %  
Host Chinese in Chinese % Control  
Host Country   Population 2011 Country 2011 Total (1) GDP Host (2)  
Indonesia         248,000,000        8,010,720 3% 71%
Thailand           64,260,000        7,512,600 12% 81%
Malaysia           28,730,000        6,540,800 23% 63%
Singapore (3)             5,260,000        2,808,300 76% 96%
Philippines           95,830,000      12,413,160 13% 62%
Myanmar/Burma           62,420,000        1,053,750 2% 76%
Vietnam           89,320,000            992,600 1% 41%
Laos             6,560,000            176,490 3% 99%
Cambodia           14,430,000            147,020 1% 92%
Brunei                410,000              51,000 12% 24%
(1) Research by Poston and Wong: The Chinese Diaspora: The Current distribution of the overseas Chinese
(2) The economist later replicated by many sites
(3) % Ethnic Chinese calculated as % of Singaporean citizens not total Singapore population

 

 

 

Southeast Asia

Source: The economist

Activating the Chinese Diaspora

Since the fall of the Qing Dynasty in 1911, overseas Chinese have played an important in both the politics and economics of China. For instance, much of the funding for the 1911 Chinese revolution was donated by Chinese living abroad.  After 1980, when China began undertaking economic reform, the People’s Republic of China actively recruited the assistance of its overseas population both in terms of skills and capital. More recently, China has worked to maintain the allegiance of recently emigrated Chinese, especially those professionals and students working and studying in foreign countries. Xi Jinping believes that the Chinese diaspora can play a significant role in helping China to reclaim its status as a premier nation both economically and politically. Overseas Chinese are some of the world’s most educated and successful professionals and entrepreneurs. With estimated total liquid assets of $1.5-2 trillion, the Chinese diaspora holds a substantial capital as well as expertise and relationships to be tapped for the continuing economic growth of the mainland. Additionally, it is estimated that the Chinese diaspora returns approximately $50 billion annually to China in terms of remittances.

In order to capture their expertise, Xi Jinping has launched a range of policies designed to encourage their continued engagement with the country. Such policies include the creation of over 200 Confucian institutes globally which have encouraged overseas Chinese to connect with their language, culture, homeland and each other. China has also been successful at encouraging ethnic Chinese to return to China to startup companies. Incentives proffered include the provision of free real estate or office space in high-tech parks, preferential tax treatment, preferential access to banking and credit, venture fund matching and streamlined regulatory processes. As an indicator of effectiveness of such policies, Greater Pacific Capital estimated that 25% of all tech startups in China are founded by returnees as opposed to home-grown entrepreneurs.

China has also worked to more effectively connect with the Chinese diaspora who intend to remain in their host countries. Programs include connecting overseas Chinese in academia and the science and technology sectors with their mainland Chinese counterparts as well as providing funding for their endeavors. Confucian Institutes help Chinese stay in touch with their language and culture while transmitting traditional Chinese culture and values around the world. Government web portals such as China Scholar Abroad and China Diaspora Web link ethnic Chinese with the mainland. The Chinese government has also hired top brand consultants and policy strategies to improve its international image and to advance policy agenda worldwide.

Additionally, China is also working at keeping it Chinese diaspora on message and sympathetic to China’s domestic and international policy objectives by creating a Chinese digital space where its points of view can be articulated. To this effect, China has acquired the control of newspapers, television stations and radio stations targeted toward the Chinese diaspora; it has used its economic clout to influence the reporting of independent media that have business ties with China; it has acquired both broadcast time and advertising space from existing independent media; and it has encourage ethnic Chinese to work in foreign media outlets in order to influence their reporting from within. Often, it has softened its messaging by placing its national goals under the banner of ethnic unity and common ethnic interests.

Trends

  • A declining workforce will necessitate China to shift from a low-wage, labor-intensive model to a one where resources are used more efficiently, where there are increases in labor productivity, and where automation and robotics technologies help offset labor declines. There will also be pressure to increase the retirement age.
  • The change from the One Child Policy to the Two Child Policy will result in only a small increase in China’s population.Significant socioeconomic changes that have occurred since the onset of the One-Child Policy have caused China to transform into a low fertility culture. These changes are consistent with the pattern countries follow as they become more developed.
  • Going forward, China’s large population will continue to provide the country with enormous challenges. As its population continues to age, China will be challenged by slower GDP growth and the need to create pension and healthcare systems that will help relieve the burden of the young to care for the old. Additionally, China’s growing population, which is predicted to peak by 2035 at approximately 1.461 billion people, will continue to put enormous demands on its scarce natural resources. Water management, in particular, will be a huge future challenge.
  • The challenges of China’s rapid urbanization are significant. Rapid economic growth will be necessary not only to the finance the enormous cost of this level of urbanization, but also to ensure that when centralized, urban populations do not protest government policy, as they did in Tiananmen Square in 1989. This could be a particular risk if long term migrant workers continue to be denied the same basic rights as registered urban residents, particularly as those urban residents will become an increasingly smaller percentage of the total urban population. Continuing to favor the original urbanites with government services risks long-term disadvantaging a large section of the population.
  • Additionally, urban residents use, on average, 3.6 times as much energy as rural residents, creating greater demands on energy grids. Urbanization can also lead to greater motorization, taxing China’s new road infrastructure. Greater urbanization will also generate higher levels of pollution, further exacerbating China’s already polluted air.
  • More changes in the household registration system, which identifies a person as a resident of a specific region—the so-called hukou reform—could accelerate the move of workers from rural areas to cities and help reduce the country’s growing inequality. HuKou reform will continue to proceed gradually, with second tier and smaller cities seeing reform while large metropolises such as Beijing and Shanghai keeping residence restrictions firmly in place. In the near term, urban hukouresidents will continue to get better ranking jobs, better wages, and benefits.
  • China’s diaspora will continue to see growth in the coming decades. Part of this growth will be driven by university students continuing to remain in their host countries after graduation and part of the growth will be driven by wealthy and skilled professionals leaving China to seek better work opportunities and a better quality of life. Additionally, as China continues to build infrastructure globally, some Chinese migrants that have worked on the infrastructure projects will seek to remain in their host countries. For instance, it is estimated that approximately one million Chinese have emigrated to Africa since 2001. These immigrants have come both via state projects and via their own initiative.
  • China will continue to activate its diaspora to achieve its domestic and foreign policy objectives. China views its diaspora as a source of capital and expertise. It also views it as a way to influence host countries from within.

References

The Chinese Environment: Positive Trends toward Environmental Protection

Introduction
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Environmental degradation in China has increased significantly in the last 30 years. In 2000, China’s Environmental Protection Agency found that two thirds of China’s 300 largest cities had air quality which exceeded WHO standards for acceptable levels of total suspended particulates. Additionally, China’s water is also both in short supply and highly polluted.  Stresses to China’s environment will grow in the future. By 2030, it is estimated that approximately 300 million new vehicles will fill China’s roads; an additional 350 million people will move into China’s cities; and an expanding number middle class will demand better food and more consumer goods. By 2030, even with China’s rapidly developing alternative fuels capacity, it is estimated that China will need to burn almost 200 million tons more coal than in 2005 to provide sufficient heating and electricity for its new urban citizens. Indeed, overall coal-based power generation capacity is projected to triple from its 2005 rate by 2030. In 2007, the World Bank assessed that China’s combined health and non-health cost of outdoor air and water pollution to be conservatively $100 billion annually, or 5.8% of the country’s GDP, and that up to 500,000 people in China die each year from air and water pollution.

Yet, despite the magnitude of China’s environmental crisis, positive trends are emerging which will begin to slow the damage being inflicted on China’s and the world’s environment. Perhaps most importantly, Beijing is increasingly recognizing that China is placing unsustainable stress on it ecology. For the first time, China’s 12th Five Year Plan prominently features both the importance of improving energy efficiency, and of mitigating climate change. As a result, in the next five years, Beijing will invest heavily in green technologies, alternative fuels, and energy efficiency. Beijing sees these investments as one way for China to take the lead in green industries; indeed, by 2015, for example, China is projected to have the world’s largest installed capacity of alternative fuels.

This trend toward greater environmental protection is also being driven by a growing emphasis on green lending within China’s banking sector, and by China’s need to comply to international environmental standards such as the ISO 14001 in order to compete in international markets. Domestic and international NGOs are also gradually raising environmental awareness in a whole range of areas. Multinational corporations, too, are playing their part, progressively insisting that their Chinese factories meet local environmental regulations, and introducing into China environmentally friendly technologies and practices.

China’s 12th Five Year Plan –Featuring Climate Change Prominently

shutterstock_87381041For the first time, China’s 12th Five Year Plan highlights climate change and energy efficiency prominently. The plan sets a GDP growth target of 7%, which would be a significant slowdown from the average 11.2% rate of growth reached between 2006 and 2010. The 12th Five Year Plan and subsequent commitments also adopt as domestic, binding law the voluntary climate pledges China made at Copenhagen in 2009. Specifically, by 2015, China plans to reduce its carbon intensity by between 40% and 45% from 2005 levels, to increase its forest cover by 12.5 million hectares and its forest stock volume by 600 million m³. As of 2015, these same goals remain unchanged, and China has pushed them another five years into the future. The country now hopes to realize these reductions by 2020. Measuring China’s progress towards these goals remains inaccurate because the nation has not released many reliable and updated figures on carbon intensity to the public. The figures remain ambitious: by 2020 China aims for an energy distribution of 350 GW in hydropower, 200 GW in wind power, and 100 GW in solar power.

The five year plan sets several separate targets for 2015, including: a 16% reduction in energy intensity; a 17% reduction in CO2 emissions per unit of GDP;  an 8% reduction in demand for both chemical oxygen and sulfur dioxide; a 10% reduction in both ammonia nitrogen and nitrogen oxides. The plan also highlights the need to improve sewage and sludge treatment, and to better the rates of desulfurization and de-nitrification. It also seeks to protect the living environment with policies to reduce rural pollution from agriculture, to expand nature reserve development and biodiversity conservation, and to extend waste management infrastructure. Beijing is also planning to upgrade subway and light rail in cities that already have urban transit systems, as well as to construct new systems in at least nine other cities. It will also build 35,000 miles of high speed railway with the ultimate goal of connecting every Chinese city of 500,000 or more people. China may also soon unveil plans to create 10 million electric car charging spots by 2020.

Looking at the layout of the 12th Five Year Plan, decisions 52 through 54 of the 12th FYP are especially promising. The 52nd decision puts forward a commitment to establishing national parks and outlines a more flexible plan for local governments. Municipal officials in environmentally damaged areas who were once expected to meet certain GDP targets will no longer be held accountable to those numbers. Instead, their decisions and implemented policies will be closely monitored to assure that they are not furthering the environmental damage in their respective regions. The 54th decision works together with the 52nd, laying out the groundwork for a system where all environmentally-related developments must be licensed. With the added scrutiny and pressure to meet economic goals removed, it will be much more difficult for government officials to find legitimate reasons supporting preferential treatment for companies damaging local rivers and farms. Decision 53 acts as a capstone to this policy outline, reflecting China’s recognition that the current environmental situation has resulted from years of damaging habits and forming a national plan to rehabilitate damaged farmland.

China’s 12th Five Year Plan –Emphasis on Renewable Energy

The 12th Five Year Plan also seeks to have renewable energy account for 11.4% of China’s power consumption by 2015. China plans to increase wind power by 70 gigawatts. With regard to nuclear power, China projects installing 40 additional gigawatts of safe capacity by 2015, though after the disaster at Fukushima in Japan, China has also vowed to review and strengthen the safety of all its nuclear power as part of its expansion strategy. China anticipates increasing its hydropower to approximately 380,000 MW by 2020 and expects to have solar capacity of between 10 GW to 30 GW by 2020. Indeed, seven of the planet’s top 10 solar panel makers are now Chinese. At the end of 2014, the China Electricity Council reported that renewable energy sources had increased their share by 19%, while fossil fuel usage declined 0.7%. Energy capacities also increased significantly: China’s non-fossil fuel energy capacity rose by 55.8 GW to 444GW, with solar, hydro, and wind power rising by 10.6 GW, 22 GW, and 23.2 GW respectively. These changes surpass those outlined in China’s 12th Five Year Plan, and put it on track to meet 2020 targets. Should it meet them, China will have the most installed wind, nuclear, and hydro-power in the world, and will have one of the largest solar capacities.

As a whole, China’s renewable energy sector has expanded dramatically over the last few years. From 2009 to 2013, the total production of renewable energy sources expanded nearly 13.3% annually, and is expected to remain fairly high at 11.8% per year in the five years ending 2018. National investment in green energy has also increased quite healthily, with USD $87.5 billion invested in total during 2014, up 36% from 2013 and comprising just over 32% of global investment in the sector. All of these positive changes have catapulted China into the number one spot in many renewable- and green energy-related production indices, and have made the nation the world leader in renewable power development. In the 2015 report from the Renewable Energy Policy Network for the 21st Century, known as REN21, China took the top spot in 11 of 26 categories: greatest investment in 2014 in renewable power and fuels, hydropower capacity, solar photovoltaic and water heating capacity, wind power capacity, and greatest generation by volume of renewable power (both including and excluding hydropower), total hydropower capacity, total wind power capacity, total solar water heating capacity, and total geothermal heat capacity. Wind power continues to rise in China, with Asia as the dominant market for the past seven years. As of 2014, the total capacity of wind power in Asia has surpassed that of Europe, in large part because of China’s extensive investment in the field. Indeed, the whole renewables industry has momentum that will carry China forward into future years and determine goals established in further Five Year Plans.

China’s 12th Five Year Plan –Pushes More Effective Pollution Data Collection

Of key importance to its environmental efforts is China’s intention to implement comprehensive data collection and monitoring systems, soon allowing it to follow a more data-driven approach to environmental policy. Yet, it is not clear how much of that data will ultimately be made available to either the public or the wider world. China’s political vulnerability because of environmental pollution is still a serious concern within a Chinese leadership that fears environmentally triggered “mass incidents” (a euphemism for protests or social unrest) and the resulting social instability. There is also concern that foreigners will use environmental data to interfere in China’s internal affairs.

For example, recent air quality monitoring by the US embassies in Beijing, and most recently Shanghai, has led to controversy as US reading  contradict Chinese official data. Increasing numbers of Chinese citizens, along with many in the expat community in China, are turning to US environmental data.  In 2011, for instance, Beijing health authorities insisted that air quality was perfectly safe 80% of the time while US statistics rated the air quality is good for about  4% of the time. The discrepancy in readings results from the fact that the US Embassy monitors small air particles known as  PM 2.5 which Beijing authorities have neglected to include in their data. Chinese authorities have work to quell increasing controversy by agreeing to measure the PM 2.5 particles as of 2015. They have also called into question the accuracy of the US readings. According to Wikileaks, in 2009, Chinese officials went as far as to request that the US Embassy stop tweeting its air pollution data because it said the conflicting data was “confusing” and could cause “social consequences”.  As of May 2012, the US Consulate in Shanghai has also begun issuing pollution statistics. The US Consulate alerted Shanghai officials in advance that it would be publishing pollution data. In its tweets, the US Consulate emphasizes that the pollution results are derived from monitoring equipment solely based at the US Consulate, and do not necessarily reflect the air pollution quality of the entire city. Again, US data conflicted with the official Shanghai statistics, with the US consulate finding the air quality as unhealthy, where the Chinese data finds the air quality good.  By June 2012, the Shanghai Environmental Protection Bureau will also release air quality data including PM 2.5 particulates.

Like the divergent air quality statistics, reports on provincial emissions often differ significantly from on-site data. Some suggest that this may be the result of China’s national carbon emission reduction targets, because businesses find it easier to meet their carbon goals if they overestimate them at the outset. To remedy this inconsistency, the Chinese Academy of Sciences has begun a year-long study to identify the largest carbon emission culprits and their numerical contribution to China’s carbon outlay.

Studies on the pollutants affecting China’s soil quality also remain scarce. Some of the more recent statistics indicate a large, but largely ignored problem. Pollution in 16% of all Chinese soil exceeded standards, and 19.4% of all arable land contained heavy metals, also above acceptable limits. Enough productive land has been affected that China may be risking a loss of food security and self-sufficiency should the decline in land quality continue. The 12th Five Year Plan does push for improved data collection, but China still has areas in the environmental sector that need improved data collection before resources are destroyed beyond repair.

China’s 12th Five Year Plan –Looking to the Market to Help Protect China’s Environment

In addition to new pollution targets and better data gathering, China 12th Five Year Plan articulates market-driven solutions to reduce pollution domestically, including: offering financial incentives to enterprises engaged in sewage treatment, sludge treatment, desulfurization, de-nitrification and waste disposal; strengthening the pollution charging system so that high-pollution production faces higher costs; encouraging lending to green projects; and increasing the portion of green products on government procurement lists.  Beijing is also considering evaluating party member performance on pollution mitigation as well as GDP growth targets. The plan also proposes an environment tax in order to deter pollution, promote clean technology and create funding for environmental clean-up. It is likely that the tax will be first introduced in China’s wealthier provinces, and then rolled out nationally. Cap-and-trade carbon pilots on the national scale are also being deliberated, as is an expansion of the 11th Five Year Plan “1000 Enterprises Program” to “10,000 Enterprises Program.” Regional carbon trading programs have already officially begun pilot testing in several provinces, with the ultimate goal of creating a unified carbon cap-and-trade system sometime around 2017. Going estimates place the size of this potential market at around RMB 100 billion by 2020.

In 2005, it was determined that the energy consumption of the top 1000 Energy Consuming Enterprises accounted for 33% of national and 47% of the dead industrial energy usage in 2004. Under the program, 2010 energy consumption targets were determined for each enterprise. High energy consumption enterprises include those competing in the iron and steel, petroleum and petrochemicals, chemicals, electric power generation, non-ferrous metals, coal mining, construction materials, textiles, and pulp and paper industries. While detailed information on program results is difficult to attain due to confidentiality, a 2010 study by Lynn Price, Xuejun Wang and Jiang Yun indicated that the Top 1000 Enterprises Plan was tracking positively to reach its goal of saving 100 metric tons carbon equivalent (Mtce) in 2010, could even surpass the figure by as much as 48 Mtce. When calculated in terms of reduced CO2 emissions, the effect of the Top-1000 program is enormous. Meeting the 2010 100 Mtce savings target will result in energy-related CO2 emissions reductions of 300 MtCO2, an amount equivalent to the 2005 annual emissions of Poland.

Indeed, improving energy efficiency is key to China’s new, “scientific outlook” on development. The scientific outlook most immediately focuses on technological solutions, notably through improved efficiency as the principle short term way to conserve resources. The program also promotes the idea of a “circular economy” where China actively reduces, reuses and recycles. It is by efficiency gains, the pursuit of the circular economy, the employment of alternative energies, and the embracing of new green technologies that Beijing believes that it can significantly grow GDP while ensuring sound ecological conditions.

Large Projected Investments in Green technologies

If all the measures proposed in the 12th five-year plan are implemented, China will be creating a huge market for clean technologies, with the potential to exceed $1 trillion. Beijing will be investing heavily in the sector. During the 12th five-year planning period, Beijing’s green sectors investments are expected to reach $468 billion, up from $211 billion over the previous plan. The bulk of the investment is slated for waste recycling and reutilization, green technologies such as alternative fuel vehicles, and renewable energy. This investment will drive projected annual growth in China’s environmental protection industries to an average of between 15% and 20% through 2020. World Watch Institute, a research institute devoted to the analysis of global environmental concerns, expects that China will create as many as 4.5 million new green jobs during that period.

With these and other investments, in the future, China hopes to lead the world in green technology, leapfrogging the developed world’s carbon-based economies. The transition costs to a less carbon-dependent economy will be less for China than for advanced economies, because it is not locked into a high-carbon model to the same degree. Also, green technology levels in the developed and developing worlds are on par, so that China also does not have to play catch-up to be competitive in the sector. Indeed, many in the international environmental movement have expressed hope that China may ultimately lead in climate change initiatives, particularly given its large and growing investments in the sector.

Other Factors Working to Reduce Environmental Degradation in China – Green Lending

In February 2012 the China Banking Regulatory Commission (CBRC), China’s top banking regulator, issued the Green Credit Guidelines to help facilitate China’s transition to a more environmentally friendly development model. The guidelines apply to domestic policy banks, commercial banks, rural cooperation banks and rural credit cooperatives, as well as village banks, loan companies, rural funding cooperatives and non-banking financial institutions. . The guidelines encourage lenders to reduce loans to industries with high levels of energy consumption and high levels of pollution, and to strengthen financial support for green industries and projects. Specifically, the guidelines require the financial institutions’ Board of Directors or Council to take charge of establishing a “green credit development strategy”, as well as to approve green credit loans, issue regular green credit reports, and supervise the institution’s green credit performance.  Senior management will be responsible for reporting annually to the Board of Directors and regulators about the progress of green credit practices. Additionally, banks will also be required to maintain a list of high-polluting clients, and urge these clients to take pollution mitigating measures. In the future, banks will also be expected to do more thorough environmental due diligence before lending, and restrict credit to highly polluting clients.

Even if credit has been granted, disbursement of the loan proceeds can be suspended or terminated if the client begins to engage in environmentally damaging practices. Post-lending, banks are required to report to regulators any behaviors by its borrowers which are resulting in environmental damage. For overseas projects, financial institutions must ensure their financing is for projects complying with local environmental regulation. Banks are also required to conduct internal audits of their green credit practices regularly; every two years, a comprehensive evaluation of its green credit practices are to be submitted to the CBRC. The CBRC is to conduct off-site and on-site inspections to ensure that financial institutions comply with its Green Credit Guidelines.

These regulations are designed to further develop what was already a growing trend in green lending in China. By end of 2011, China’s six largest banks – China Development Bank, Industrial and Commercial Bank of China, Agricultural Bank of China, Bank of China, China Construction Bank, and Bank of Communications – had a total of $301.75 billion in green credit lending. In particular, in 2011, China Development Bank lent $104 billion to support environmental protection, energy saving and emissions reduction projects, accounting for 12.7% of the bank’s total outstanding loans. Even before the 2012 guidelines, green lending in China was growing because of rising demand by customers, and because government support for green projects has meant that many green loans have lower non-performance ratios. Ultimately, the future success of the guidelines will be dependent on the banking industry’s ability to collect accurate environmental data on its customers. Certainly, the government’s 12th Five-Year Plan indicates a greater commitment to environmental data gathering. Again, it still remains to be seen whether Beijing will then allow this information to be more widely circulated.

Other Factors Working to Reduce Environmental Degradation in China – Meeting ISO Standards

shutterstock_104036633China’s participation in standardization laws are also helping to drive pro-environmental business practices. ISO, an international organization headquartered in Geneva, issues two kinds of specification standards to which China strives to comply: those which facilitate commerce by normalizing product standards and those which standardize procedures. The IS0 14001 incorporates environmental policy into its framework by creating a standardization of management practices and implementation of environmental procedures. Since 2006, China has led the world in ISO 14001 certificate registrations. China’s ISO compliance efforts are driven by the fact that many of the markets into which China exports now request ISO 14001 observance.

Other Factors Working to Reduce Environmental Degradation in China – NGOs

Domestic and international NGOs are also becoming increasingly important to China’s environmental activism. The Academy for Green Culture, now called Friends of Nature, was the first environmental NGO formally registered in China in 1994. Since then, several hundred international and domestic NGOs engage in nature conservation, species protection, environmental education, policy advocacy, data collection, legal advocacy, environmental information exchange, wasteland reclamation and organic farming. Indeed, leaders of three Chinese NGOs were appointed as environmental advisers to the Beijing 2008 Olympic Bid Committee and were instrumental in helping China win its bid. These NGOs work both at a community and a national level. Examples of NGOs active in China include Green River, Global Village of Beijing, Institute of Environment and Development, the World Wildlife Fund, Green Earth Volunteers, Green-Web, the Natural Resources Defense Council, Greener Beijing, and the Center for Legal Assistance to Pollution Victims.

Despite their growing presence, NGOs face real challenges when working in China. NGOs often lack any real influence, particularly when faced with entrenched business interests. Domestic NGOs are often challenged by fund raising difficulties. On many occasions, new NGOs have been refused registration, thus denying them the benefits of NGO status. The government also closely scrutinizes the work of these NGOs in order to prevent environmentalism from evolving into a push for broader political reform. In general, domestic NGOs are reticent to criticize the central government publicly, and work hard instead to engage in cooperative relationships with local officials.

Other Factors Working to Reduce Environmental Degradation in China – Multinationals Making a Difference

Multinationals are also beginning to positively impact environmental protectionism in China. Given that China is often their factory, and given the growing environmental activism within China at the governmental, NGO, academic and social levels, multinational corporations are increasingly under pressure to ensure that their production, and the production of their suppliers, in is in compliance with local environmental standards. For example, in August 2011, Apple received bad press for ignoring its suppliers’ outstanding public pollution violations which had been brought to its attention by a consortium of five Chinese environmental NGOs. Within a month, Apple was working with its suppliers and the NGOs to improve environmental performance.

Multinationals are also increasing taking initiative in helping their Chinese suppliers use energy, water and materials more efficiently, and reduce emissions where possible. Shell China, for instance, one of the largest multinational companies operating in China, has been introducing better environmental practices and technologies. In 2009, in the Changbei Gas Field, where it works jointly with PetroChina, Shell increased gas production by 11% while decreasing energy intensity, resulting in annual savings of around 2500 tons of standard coal – enough to provide sufficient power to support 10,000 urban Chinese families for three and a half years.  The project also reduced the volume of its wastewater by 70%. These environmental practices are good business as they improve profitability. Yet, they are also introducing methods and technologies that are then absorbed more broadly. Multinational investors also drive environmental practice in China. Worried about environmental liability, they encourage multinationals to implement stricter environmental practices.

Trends

shutterstock_110013224Despite the many factors which will continue to perpetuate environmental degradation in China over the coming decades, and the magnitude of China’s environmental challenge, China’s environmental trends are not all grim. Indeed, many developments indicate that China will make increasing progress in the field of environmental protection.

One of the most important of these developments is the growing emphasis Beijing is placing on environmental protection. Indeed, not only is Beijing beginning to articulate a well thought out and increasingly detailed plan as to how China can begin to protect and restore its bio-capacity, but it is also backing that plan with an unprecedented level of short-term investment. This investment will soon allow China to take leading positions in many environmental sectors. For instance, by 2015, China will have more installed alternative fuel capacity than any other country.

This investment will create huge opportunities in China’s green technologies market. Investing heavily in green technologies may enable China to gain an advantage over developed countries with a heavy reliance on their carbon-intensive economies. For instance, China now has the largest solar water heater market in the world. Approximately 95% of patents for core solar water heating parts are owned by Chinese companies. These patents allow heaters to function even under grey skies and at temperatures well below freezing. It is estimated that at least 30 million Chinese households now heat their water with solar panels.

Indeed, leading the development and implementation of green technology is one of the ways China is creating the competitive edge it needs to remain an economic powerhouse in the future, especially as its rapidly aging and shrinking workforce means that it will not be able to indefinitely compete just on the basis of cheap, plentiful labor. As the impact of global warming is increasingly felt, and as growing fossil fuel demand continues to put upward pressure on fuel prices, demand for green technologies will rise. China will position itself to profit from these opportunities by first introducing green technologies at home before aggressively seeking to export them to foreign markets.

China will begin to lead the way in green architecture and urban development as 70% of its population settles into cities by 2030. It will increasingly introduce technologies which will avoid high electricity consumption in buildings. Specifically, we will see China install more energy-efficient lighting, appliances, heating, ventilation and air-conditioning systems, and better insulation in walls, windows and roofs. Similarly, it will also prioritize retrofitting its existing building stock with energy-saving features.

shutterstock_104036633China will also invest in the development of alternatives to internal combustion engine (ICE) transportation. This can already be seen in its growing commitment to the construction of rail and mass transit systems. China can also be expected to increasingly reduce emissions and increase fuel efficiency in the ICE cars that do reach its streets. It will also continue to invest heavily in alternatives to ICE cars. Specifically, China plans to push the full range of advanced battery technology for electric vehicles. Indeed, by exploiting its current pool of low-cost labor, along with its fast-growing domestic car market, its proven success in rechargeable battery technology, and its substantial investments in R&D, China has the potential to emerge as a global leader in electric vehicle technology in the coming decades. Indeed, its plans to create 10 million electric car charging parking spots by 2020 suggests that it the pursuit of affordable, high-performance electric vehicles will continue to be a priority. Currently, China has 16,000 AC charging spots in operation.

Despite China’s growing commitment to alternative fuels, its use of coal will still rise significantly in the future. Increasingly, China will work to offset its carbon emissions by investing in technology that sequesters carbon emissions for next-generation coal plants. Indeed, China wants its clean energy sectors and it clean energy technology to become 15% of its economy by 2020.

Also of note is China’s growing nuclear program, which has exhibited consistently high rates of growth over the last 15 years. Consumption in the sector is expected to increase by 15.4% for the next five years ending 2020, while renewable energy is projected to grow around 7.5%—though this is likely due to the high level of development that China has already achieved in its fairly mature renewable energy sector (which accounts for 9% of energy production in the nation, compared to the 1% share occupied by nuclear energy).

Furthermore, China currently produces a lot of industrial municipal waste that it does not recycle or properly manage. China will increasingly rectify this by employing technologies that will allow it to convert its waste into useful material. For instance, there’ll be a growing trend toward coal-bed methane recovery and recovery of blast furnace slag resulting from steel production. It will also seek to burn more of its municipal waste to generate electricity, instead of sending it all directly to landfill.

Green lending, ISO compliance, the influence of domestic and international NGOs and multinationals will also continue to drive positive environmental behavior in China. It can be expected that China will also be inviting more foreign investment in the green technologies sectors.

All that said, many of China’s dominant economic and political incentives have not changed. 129 million Chinese citizens still live on less than $1.25 a day, and 400 million earn $2 a day. China’s population will continue to grow through at least 2030, and inequality in China has increased significantly both within the population, between rural and urban residents, and between different regions within the country. Those Chinese moving into the middle classes will demand a better diet and consumer goods. China’s government will thus remain under enormous pressure to improve the standard of living of its people and to reduce inequality nationally.  Proponents of low carbon future for China thus face significant opposition by others who suggest that China should focus on unrestrained development until more of its population has reached a modest but dignified standard of living.  China’s 11th Five Year Plan also advocated a slower, more balanced GDP growth, yet China’s GDP growth exceeded 11% during the period. Local governments, in particular, have many incentives to keep to business as usual.

Still, within the international climate community, there is some hope that China may come to take a leadership role in climate change mitigation. They note that China has not stepped back from its 2009 voluntary Copenhagen commitments; instead it has translated them into binding domestic law. They also note China’s opportunity to leapfrog the carbon-based infrastructure installed in developed countries, partly because of its history of radical experimentation, but also because of the greater ability of its authoritarian government to dictate far-reaching environmental policy. China’s obvious desire to profit from the rapidly growing green technology sectors is, therefore, potentially good news for everyone.

Ultimately, Chinese leaders have an opportunity to follow a path of development that diverges from a Euro-American capitalist model that is no longer accepted as indefinitely sustainable; in the long run, the world does not have the bio-capacity to support billions of new people consuming like Americans and Europeans. The Chinese leaders seem to increasingly acknowledge this. In 2008, for instance, Ambassador Yu Qingtai noted that while he could not accept that as a Chinese, he was only entitled to one quarter of what western developed nations have enjoyed, he also recognized that it would be a nightmare for China if its 1.3 billion people had the same per capita emissions as the Americans. That representatives of the Chinese government are beginning to articulate that high Chinese per capita emissions would be a nightmare for the Chinese themselves is also grounds for optimism about the possibility of improved global environmental protection. The outlook continues to be positive. In November 2014, China announced plans to halt emissions increases by 2030. With these national efforts China will certainly see large changes, and perhaps the birth of entirely new markets, in the coming years.

How China is Tackling its Water Challenge

Introduction

TheChinaFile

China faces a severe water shortage. Its current water per capita is one quarter of the world average. This per capita water availability will decrease in the coming decades as China’s population peaks at between 1.4 and 1.5 billion people by 2030. China’s water usage per capita may be low by international standards, but it is expected to grow by between 40 and 50% by 2030. Factors such as higher living standards, increasing urbanization and further industrialization are driving water demand.

The water that China does have is often badly polluted. An estimated 70% of China’s rivers and lakes are currently contaminated and 300 million people drink water tainted with inorganic pollutants such as arsenic, excessive fluoride, untreated factory wastewater, agricultural chemicals, leaching landfill waste, and human sewage. China’s water is also inefficiently consumed, compounding its water challenges. 45% of water destined for agricultural use is lost before it even reaches crops. Only 40% of its industrially used water is recycled, compared with 75% to 85% in developed countries and water lost from urban plumbing leaks accounts for 18% of total urban water withdrawals.

Moreover, China’s water is unequally distributed throughout the country. The Yangtze River basin and areas to the south receive 80% of China’s naturally available water resources to support only 54% of its population, 35% of its arable land, and 55% of its GDP, while the north gets just 20% of China’s water. Deforestation, overgrazing and unsustainable agriculture have destroyed local ecology in many parts of China, affecting China’s overall rainfall, and exacerbating China’s age-old challenges of drought and flooding. To meet its growing water demands, especially in the north, China is depleting its underground aquifers, lakes and river systems at untenable rates. As water becomes scarcer, competition for water is increasing between agriculture and industry as well as among China’s growing cities and different regions of the country. This trend will only continue in the coming years; by 2009, surveys revealed that 58.3% of river water, 49.7% of lakes, 79.5% of reservoirs and 38.7% of wells were of quality necessary to be deemed adequate water sources. China remains particularly opaque and is reticent about releasing regular and up-to-date water statistics.

China has tried to solve its flooding, drought, and water scarcity problems through hydro-engineering projects such as the Three Gorges Dam and the South-North Water Diversion Project. Yet hydro-engineering alone will be unable to create sufficient water supplies to meet China’s future demand. China will need to improve the management of its water resources and the legislation governing its use. Perhaps most importantly, Beijing will need to increase the price of water to better reflect its scarcity value, allowing for the economic restructuring that this higher cost will cause. Repairing China’s ecology will also be essential. A healthy ecology will not only aid the prevention of desertification, with all the water loss that such environmental damage causes, but it will also help to maintain upstream eco-systems, which are essential for the long-term supply of good water sources. China will also need to upgrade the efficiency of its water delivery systems to agriculture and to its cities, and to improve the efficiency utilization rates in industry. Environmental protection will be essential in ensuring the water that China does have is potable. China must clarify its environmental protection laws, improve enforcement and increase fines. Without implementation of such measures, water scarcity risks limiting China’s future economic growth. Water scarcity could also challenge China’s political and social stability. Increasing illness caused by polluted water is driving up healthcare costs and generating more internal dissent. In 2005, the Chinese government acknowledged that 50,000 environmentally related “mass incidents” (a euphemism for protests) occurred, many of which were sparked by water degradation.

Interestingly, the Chinese Committee of Political and Legislative Affairs also acknowledged about the same amount of “mass incidents” (about 50,000) in 2013 as they did nearly a decade ago. The reality, however, is that environmental mass incidents have been steadily increasing: from 1996 to 2011, environmental protests increased at an average rate of 29% per year, spiking up nearly 120% in 2011 alone. The scale of the protests is also increasing, with around half of all “mass incidents” involving 10,000 or more people.

The South-North Water Diversion Project

TheChinaFile

Historically, China has sought to solve its water scarcity problems through reliance on large infrastructure projects. Indeed, many of China’s top leaders are trained engineers, including Hu Jintao, who is a trained hydraulic engineer. Mao Zedong is reputed to have said in 1952, “the south has a lot of water, the north little. If possible, it is okay to lend a little water”, apparently acting as the spur for building what is now called the the South-North Water Diversion Project. When completed in 2050, the $62 billion mega-aqueduct is projected to divert 44.8 billion m³ of water yearly from the Yangtze to the north. The project will follow three routes. The eastern route will transfer 14.8 billion cubic meters of water yearly from the lower Yangtze, via the ancient 1800 km Hangzhou to Beijing canal, to Jiangsu, Anhui, Shandong and Hebei provinces as well as to the city of Tianjin. It is now projected to be completed in 2013 or 2014. The central route, begun in December 2003, will divert 13 billion m³ of water from the Danjiangkou reservoir on the Han River (a Yangtze tributary) to Beijing, Tianjin and other cities. It is scheduled to be completed in 2014. The western route would transfer water from the upper reaches of the Yangtze tributaries across the Qinghai-Tibet Plateau through the earthquake prone Kunlun Mountains via a network of tunnels into northwest China. Given its technical difficulty, the western route has not yet been given official approval and it is possible that it will be quietly shelved. It is expected that as many as 400,000 people might be displaced by the projects overall, though this would be fewer if the western route were scrapped.

Overall, the South-North Water Diversion Project faces many logistical challenges, the most important of which is ensuring that the water that does reach the north is sufficiently pollution-free to be usable. The eastern route, for instance, crosses 53 heavily polluted river sections. Clean-up efforts and water treatment facilities on this route alone will account for about 40% of the total aqueduct cost. If effectively implemented, it will be one of the most comprehensive water clean-up operations ever seen. 379 pollution control projects including wastewater treatment plants and wastewater recycling facilities are slated to be constructed, and major sources of industrial pollution such as paper mills are being shut down. Nevertheless, the clean-up process continues to be challenging.

Water Desalinization

China is also investing heavily in water desalinization in order to increase its water supplies. Research into water desalinization began in 1958 and more than 20 seawater desalination projects have been constructed which currently desalinate 600,000 m³ of water a day. China aims to produce as much as 3 million m³ of desalinated water daily by 2020, mainly for use in the north of the country. Desalination, however, is expensive and energy-intensive, and also requires water for its production. For these reasons, it cannot be considered to be a serious solution to China’s water shortages.

In 2012, the Chinese government outlined their policy goals for the next three years, ending at the conclusion of 2015. The government hopes to reach 2.2 to 2.6 million cubic meters or water per day, a far cry from the 660,000 cubic meters currently produced per day in China, but still possible given that plans exist to bring another 1.4 million cubic meters of water production online in large-scale desalination plants.

As of 2014, China had expanded its efforts in water desalinization with a total of 75 desalination plants, with nine more under construction. Though this technology may not be the most efficient at providing coastal cities with drinking water, these plants supply water that is used in coastal factories, sewage, and other wastewater management solutions, thereby allowing more drinking water from lakes, rivers, and reservoirs to be directed towards individual use. In the last decade alone, 60 desalination plants were built to run on seawater reverse-osmosis technology, producing 348,000 cubic meters of water per day, and an additional 11 plants were designed to utilize low temperature multi-effect distillation and produce a further 222,300 cubic meters per day.

Water Management

Ultimately, China will need to tackle its water scarcity issues not just by generating more supply, but by more efficiently managing and using its existing water resources. China’s water resource management system is highly fragmented. Multiple institutions have responsibility for China’s water resources, including data and information collection, hydro-infrastructure construction, environmental protection, and agricultural, urban and industrial development. There are frequent overlaps between these departments which raise administrative costs and exacerbate water’s “Tragedy of the Commons” problem. In other words, while China recognizes nationally the need for clean, well-managed water, it is in the interest of each user locally to consume water in whatever way will maximize their own short-term economic gain. This frequently gives China’s water management agencies conflicting priorities. Regional governments, for instance, often sacrifice water quality to protect local industries and jobs; they tend to focus on the water within their administrative areas, while failing to look at China’s water needs as a whole. Those considering water use in agriculture are often focused on accessing the water necessary to maintain agricultural yields. Those looking at the environmental protection of river basins try to limit the water drained from the river eco-systems. A failure to address the problem in a joined-up way persists.

This individualistic approach to the water supply in China, combined with local government corruption, has led to large-scale industrial dumping into lakes, rivers, and other aquifers. Often these waste products are, or are in large part, made up of heavy metals like cadmium or chromium that have been linked to increased risk of cancer. A recent scandal in 2011 involved the Lüliang Chemical Industry Company, which was found to be storing 288,400 tons of untreated chromium byproducts only a few feet from the Nanpan River, whose waters flow west and eventually join with those of the Pearl River. The company had been disposing of waste in this manner since 1989, and had gone as far as hiring divers to secretly dump metal into mountain reservoirs in order to reduce metal treatment and detoxification costs. Chromium levels in the river were 2,000 times China’s legally permissible standards. Effective progress in water management remains relatively slow due to ongoing and pervasive corruption that still sways local officials.

Water Legislation and Enforcement

TheChinaFile

Not only are water governing authorities fragmented, but laws governing the management of China’s water resources are still being developed. Historically, China’s water laws have been ambiguous and lacking in effective enforcement mechanisms. They have had a bias toward decentralization, with local government agencies often having a determinative voice in water issues within their region. This has resulted in widely varying levels of water-law enforcement, corruption and confusing standards for industries. Indeed, some water legislation reformers have been advocating greater centralized regulation. They point to the success of centralized management in helping to restore at least some perennial flow in the Yellow River delta. In the late 1990s, its downstream flow disappeared annually for over 200 days, because upstream provinces were drawing on the river too heavily. Beijing began limiting water allocations to each of the provinces, so downstream provinces had sufficient water. Today, the entire length of the Yellow River is monitored in real-time by data collection from dozens of monitoring stations along the length of the river. The system is designed to check and manage pollution, drought and flood control, while enforcing fair distribution of scarce water resources among the nine provinces that share the waterway. Engineers can regulate the river’s flow by opening or closing a network of automated sluice gates and monitoring devices. This system is currently undergoing an upgrade which will make it the most advanced water rationing system in the world by the time of completion which is expected to be around 2015.

Indeed, recent water legislation stresses a greater move toward a unified management of water resources. This legislation emphasizes the importance of a balance between water resources, the still-growing population, economic development and the environment. It also focuses on improved efficiency in water use and it strives to set a foundation for greater transparency, equity and efficiency in the access of and payment for water by all levels of the economic spectrum. It advocates that allocation, distribution and regulation of water resources should be increasingly made through water-drawing permit systems where users are allocated and charged for water according to sector quotas, taking into account annual water-availability conditions and the sustainability of river basins, lakes and groundwater. The legislation also attempts to make clear distinctions as to who is responsible for the quality of water in each of China’s regions and to ensure that each of those responsible works to minimize pollution and improve overall water quality. To achieve improved water quality, recent legislation also specifies the need for setting up data and information systems at all levels, and to make data gathered available to stakeholders. Indeed, in 2007, Beijing’s Institute of Public and Environmental Affairs launched its online water database, allowing public access to water quality and pollution data, including corporate regulatory breaches. Yet, this move toward better information access has been tempered by Beijing’s conflicting and simultaneous instinct to prevent the independent gathering of information on China’s water, especially regarding its trans-boundary rivers, ostensibly to safeguard China’s national security.

The 2008 Law of the People’s Republic of China on Prevention and Control of Water Pollution ties the performance evaluation of public officials, at least in part, to their meeting of water and environmental targets. It also increased monetary sanctions against enterprises discharging wastewater illegally and specified the amount of chemical oxygen depletion caused by agricultural run-off allowed in waterways. In a significant legal development, it also allowed, for the first time, class action suits to be brought against polluters.

Several decisions made at the Third Plenum also show a greater commitment in dealing with corruption in local and village governments. Officials in environmentally damaged areas will no longer be expected to meet the same GDP targets as those in other provinces, and local government actions will be monitored in an attempt to reduce the prevalence of companies bribing towns to look the other way as they pollute rivers and water sources that ultimately make their way into China’s largest rivers.

Water Pricing, Water Rights and Efficiency

Ultimately, the most important step in solving China’s water scarcity will be raising the price of water. Water is highly subsidized by the central government, often making it effectively almost free for users, creating no incentive to save water. In 2009, the average price of water per cubic meter was $3.01 in Germany, $2.37 in the UK, $1.02 in South Africa and Canada, $0.74 in the US and $0.31 in China. Of 19 major economies, only India had cheaper water tariffs. Five years later, the price of water per cubic meter rose to $3.18 in Germany, $2.41 in the UK, $2.05 in Canada, $1.46 in the US, and $0.38 in China. Prices do not seem to be ending their upward trend anytime soon.

Higher water prices are likely to generate a significant restructuring in China’s economy. Higher water prices will encourage farmers to plant crops that are less water-intensive and will encourage more efficient irrigation. Indeed, growing urban and industrial water demands may eventually lead to the elimination of winter wheat in northern China as the higher cost of water forces the shift to higher-valued uses that produce more jobs and income per water unit. Currently, 1000 tons of water produce 1 ton of wheat worth $200, whereas industry yields $14,000 of economic output for the same amount of water. Reducing China’s grain production would reflect a significant shift in the decades-old policy of 95% self-reliant grain production, and would have a real impact on global grain markets. It would also spur urbanization as farmers migrate to cities in search of new employment.

Higher water prices would also encourage factories to recycle more of their water. In the special case of the North China Plain, it is likely to check the overexpansion of some high water consuming industries. Currently the region produces 20% of China’s steel, 10% of its power, and 14% of its paper, all industries which use water heavily and cause severe pollution. This would also make the cost of water treatment more feasible as it would become more economical to process and recycle water than to dump it untreated into the rivers. Higher water costs would also make living in water-scarce cities more expensive, potentially discouraging immigration into these areas. It would foster improved efficiency of its water delivery systems to agriculture and to cities.

Such a move may also check pressure on Beijing to tap new coal supplies, particularly the enormous coal reserves in the dry north. Without further water transfer schemes, such as the controversial – and possibly unachievable – western route of the South-North Water Diversion Project, there will not be enough water to mine the northern coal reserves and still develop the modern cities and manufacturing centers that China envisages for the region. The fresh water needed for mining, processing, and consuming coal accounts for the largest share of China’s industrial water use, over a fifth of all the water consumed nationally.

Higher water prices will also help control the scale of the South-North Diversion Scheme, serving to minimize the impact on the Yangtze River. Having the cost of the scheme added into the price of water for end-users will encourage them to use the water more sparingly. Ma Jun has estimated that the cost of cleaning up the northern Huai River system and of running its industry sustainably was greater than the total annual value in production that the industry within the Huai River system generated. Economic progress has brought more people to the river valleys, so that the area now supports 1.5 times the national average. After 1949, mainly for flood control, 5100 large and small-scale reservoirs were constructed along the upper reaches of the Huai waterway and more than 10 major flood control retention reservoirs were built. Without the huge hydro-engineering in the Huai River Basin, the area would not have been able to sustain so many people. Rapid development, however, made previous hydro-engineering projects inadequate. Beijing responded by building new hydro-projects to expand water supplies further. In what has become a vicious cycle, Beijing now faces the need to divert water from the southern Yangtze to support the people and the economy in the area. Ultimately, China’s desire for development is infinite, but its water resources are finite. Unless water pricing reflects its true scarcity value sooner rather than later, China’s lack of water will put the brakes on its rapid economic development.

Enforceable water rights will also be important to reducing China’s overall water wastage. Currently, even with the recent legislation, it is still not clear who holds many water rights and what benefits these rights provide. Ideally, China needs to establish a nationwide water rights program, leaving enough clean water so its eco-systems and aquifers are sustainable. Permits should be issued to each water user, with pricing at a level which encourages increased water productivity. Creating a market to sell or lease these water rights will advance water productivity further. Those who do more to protect the river and other water basins should have greater rights. This includes those provinces and regions near the waters’ sources. The provinces could then profit by selling rights, instead of wasting water on parched land and inefficient industrial projects. Appropriate incentives for water saving technologies and behaviors also need to be developed. For instance, a tariff system could be implemented in which people pay higher bills when they consume more than a set quota.

Authorities have been slow to raise water prices because of their fears about how the higher costs will affect China’s poor. Recent research has shown, however, that lower income Chinese often get little benefit from subsidies as, ultimately, low water costs mean that they frequently receive water that is highly polluted. Nevertheless, the government remains concerned with inflation, always a hot issue in China, and this adds to the pressure to maintain low water prices despite the arguments in favor of raising them; it is unlikely that the poorest in society would welcome a price increase even if it were in their own long-term benefit in terms of improving the quality of their water supply.

Pollution

TheChinaFile

Despite China’s efforts over the last three decades, water pollution has spread from the coastal to inland areas and from the surface to underground water resources. Essential to controlling China’s water pollution is the strengthening of law enforcement to improve compliance by industries and other polluters. Overall compliance with China’s environmental laws remains low. Yet, strengthening environmental protection is a multi-faceted process which not only requires raising water prices and establishing clearer water rights, but also necessitates the continued development of water protection legislation, the further advancement of China’s judicial system, greater financing and staffing of China’s Ministry of Environmental Protection (MEP), and making public a more rigorous collection and analysis of water data. Economic incentives such as pollution levies and fines have to be rigorously enforced. Overall, pollution fines should be increased. Lawsuits should be initiated against polluters and those most hurt by damaged public goods such as river basin ecosystems should have greater rights to demand compensation. State subsidies could be given to small towns and villages to help them to construct adequate water treatment facilities. Those waste-water treatment facilities that are constructed need to be continually monitored to ensure they remain operational and in compliance. China’s Tenth Five-Year Plan (2001–2005) mandated, for instance, the construction of thousands of new waste water treatment plants, yet a 2006 survey by SEPA (the State Environmental Protection Agency, the forerunner of the MEP) revealed that half of the new plants actually built were either not operating or were operating improperly. Corruption will also need to be tackled. Lax environmental codes are often rarely enforced and easily avoided by bribing officials. Tackling corruption will likely be done most effectively by linking compensation and performance figures to environmental protection as well as economic achievement. This would make it in the personal interests of officials to perform in the environmental arena, mitigating the “Tragedy of the Commons” conundrum, though this would also represent a significant shift in government behavior.

Future Trends

China’s water challenges are becoming too big for Beijing to ignore. China’s Twelfth Five Year Plan (2011-2015) projects record levels of water use, rising to 620 billion m³ by 2015, up from 599 billion m³ in 2010. Its traditional response to growing water demand – building large hydro-engineering projects in order to increase supply – will no longer be sufficient to meet the water demands of China’s agriculture, industry and cities in the coming decades. As a result, China will begin to implement new policies in order to better manage its water resources and to reach its 2015 goals of cutting water consumption per unit of value added industrial output by 30%, reducing arsenic, lead, cadmium, chromium and mercury levels by 15% from 2007 discharges, reducing ammonia nitrate fertilizer runoff by 10% and its corresponding chemical oxygen depletion by 8%. The plan also targets the construction of water conservation structures, improved irrigation, and commits to investing in the clean-up of rivers and lakes through the construction of wastewater treatment and recycling pipes.

At the heart of these new policies will be the gradual raising of the price of water throughout China. This trend is already in evidence in many cities across the country. Shanghai, for instance, increased residential water prices 25% in 2009, and another 22% in 2010. Beijing raised the price of commercially used water by 50% in 2010 and expects to raise its water charges to residential users by 24% in stages by 2013. China’s water users have not accepted the rises without discontent and some government officials fear that higher water prices could lead to social unrest, particularly as China is concurrently struggling with inflation. This unrest is due both to poor public education about the extent of China’s water challenges and to public skepticism that higher costs will translate into more effective water management.

Fixing the quality of China’s water will also be a growing priority for Beijing in the future. China needs to improve its water pollution record both by government investment and by encouraging private investment in the water treatment and management sectors. In 2011, for instance, China allocated $606 billion to clean up water and water infrastructure over the next decade. Larger, wealthier cities had already started investing in the water treatment sector, but without government support, smaller cities and rural areas have lacked the means and incentives to make much-needed investments.

Beijing is also explicitly encouraging foreign participation in China’s water markets. Foreign firms invested about $1.7 billion in China’s water sector between 2004 and 2009, with over $500 million being spent in 2009 alone. The investments were in waste-water treatment, municipal and industrial water supply sectors, and in direct investments in China’s water companies. This involvement will continue to expand in the near future.

China will also begin to move more aggressively against significant water polluters. In 2007, maximum fines to individuals or companies who discharge highly toxic pollutants into drinking water resources were raised fivefold to 500,000 RMB (approximately $80,000). Fines for companies who dump industrial residue urban waste into drinking water resources or who store solid waste or other pollutants below the water lines along rivers and reservoirs increased 20-fold to 200,000 RMB (around $32,000). While these are significant increases the fines remain relatively low and there is room for an expansion in this area. Increasingly, enterprises will also be responsible for bearing all costs to contain water pollution accidents and may face fines as high as 30% of the direct economic loss, according to the severity of the incident. Historically, pollution levies have been so low that it has been cheaper to pay penalties rather than to treat discharge. There is a growing realization that this cannot continue.

Litigation against water polluters will also increase, with rulings to progressively penalize those fouling China’s water systems. In 2009, for instance, an Asian Development Bank study determined the number of environmental lawsuits filed in China has increased an average of 25% annually since 1988. Since 2009, the Supreme People’s Court has been encouraging China’s maritime courts to adjudicate water pollution cases brought on behalf of a public interests. Additionally, three specialized environmental courts have been established in the provinces of Guizhou, Jiangsu and Yunnan.

China’s water challenges are daunting and urgent. The array of measures that are needed to more effectively manage its resources is huge. Still, China’s leadership is well aware of the importance of water to continued economic growth and to the health and well-being of its people. Poor water management has toppled many a Chinese government throughout the millennia, a risk to which the CCP is not immune. While progress toward solving China’s water challenges is likely to be uneven, overall it is expected that China’s water management will improve on most fronts over the next five to ten years.