China’s resolve to rid itself of decades-old habits of pursuing economic growth at any cost and promote energy saving and environmental protection has stumbled because of resistance from development-minded local officials and powerful interest groups. In an embarrassing blow to China’s top leadership, which has cast itself as an advocate of green development, the country missed its much-publicised goals of reducing energy consumption and pollutants last year. Despite a target of cutting energy use per unit of GDP by 4 per cent, consumption actually increased by 0.8 per cent in the first half of the year and indices for the main pollutants continued to rise.

“2006 has been the most grim year for China’s environmental situation,” Pan Yue, deputy head of the State Environmental Protection Agency (SEPA), said through a statement last week. “The goals set out by the (country’s) cabinet at the start of thes year have absolutely not been achieved”.

The failure in energy-saving and pollution controls is seen as a result of die-hard attitudes of local officials who continue to tie their career achievements with gross domestic product(GDP) growth figures. The new “green GDP index” attempts to account for environmental degradation and resource depletion caused by economic development. Over the last two years green GDP projects have been launched in some 10 Chinese provinces and municipalities, including the capital and the northeastern port hub of Tianjin. Yet central government officials have conceded that such projects have met with resistance by local civil servants. “A lack of economic motives is the fundamental reason for the local governments’ weakness in reducing energy consumption and improving environmental protection,” Chen Qingtai, a senior economic official under the Chinese People’s Political Consultative Conference, was quoted as saying by Xinhua.

Pan said some enterprises had promised to cut pollution and energy consumption when their projects were banned by SEPA, but failed to do so once the local governments relaxed their environmental controls. One example is the city of Tangshan, whose 70 steel factories account for one-tenth of the country’s output of the metal. According to Pan, 80 per cent of these steel factories, the majority of them small-sized plants, were never approved by the administration.

In the future cities like Tangshan would be closely scrutinised when applying for the approval of new projects, Pan said. China wants to reduce energy consumption per unit of GDP by 20 per cent in the five years from 2006 to 2010. Beijing is considering higher export taxes to curb exports of energy-intensive or polluting goods, and tax breaks for energy-saving products. China’s state banks are also joining Beijing’s crusade against polluters. The People’s Bank of China, the central bank, is working on a green scheme that would evaluate the eligibility of companies for loans based on their environmental performance. sEnterprises that have poor environmental records risk having their applications for bank loans rejected, according to Su Ning, the bank’s deputy governor. “This (move) will encourage enterprises to think more about the effect their operations have on the environment,” Su said at a press briefing in Beijing last week. — IPS