Political, Legal and Regulatory Environments

China once had a socialist, planned economy where the government (one party) controlled and owned all the means and methods of production. It is now near a market economy after privatization of most of the state owned enterprises and opening up to western countries. For example, peasants now have their own farms; foreign businesses are allowed to set up in China and so on.
China's spectacular economic growth-averaging 8% or more annually over the past two decades-has produced an impressive increase in the standard of living for hundreds of millions of Chinese citizens. At the same time, this economic development has had severe ramifications for the natural environment. There has been a dramatic increase in the demand for natural resources of all kinds, including water, land and energy. Forest resources have been depleted, triggering a range of devastating secondary impacts such as desertification, flooding and species loss.
Poorly regulated industrial and household emissions and waste have caused levels of water and air pollution to skyrocket. China's development and environment practices have also made the country one of the world's leading contributors to regional and global environmental problems, including acid rain, ozone depletion, global climate change, and biodiversity loss.

Environmental degradation and pollution in China also pose challenges well beyond
those to the natural environment. The ramifications for the social and economic welfare of the Chinese people are substantial. Public health problems, mass migration, forced resettlement, and social unrest are all the consequence of a failure to integrate environmental considerations into development efforts effectively.

Still, much remains to be done. The particular mix of environmental challenges and weak policy responses means that the Chinese people cannot yet claim several basic rights: the right to breathe clean air, to access clean water, to participate in the decision-making process on industrial development or public works projects that affect their livelihood, and to secure justice when these rights are violated.
Without greater attention and commitment from the center, China's environment is likely to continue to deteriorate throughout much of the country, causing further social and economic distress domestically and levying even greater costs on the environmental future of the rest of the world.

China's overwhelming reliance on coal for its energy needs [2] has made its air quality among the worst in the world. In 2000, China's State Environmental Protection Administration (SEPA) tested the air quality in more than 300 Chinese cities, and found that almost two-thirds failed to achieve standards set by the World Health Organization for acceptable levels of total suspended particulates, which are the primary culprit in respiratory and pulmonary disease. Acid rain, resulting from sulfur dioxide emissions from coal burning, also affects over one-fourth of China's land, including one-third of its farm land, damaging crops and fisheries throughout affected provinces.

China's forest resources also rank among the lowest in the world. Demand for furniture, chopsticks, and paper has driven an increasingly profitable but environmentally devastating illegal logging trade. By the mid-1990s, half of China's forest bureaus reported that trees were being felled at an unsustainable rate, and twenty percent had already exhausted their reserves. China's Sichuan province-home to the famed pandas-now possesses less than one-tenth of its original forests. Even the worst examples of deforestation in the United States, such as the transformation of Vermont from 70% forest to 30% forest over the past century, are mild in comparison to China's experience. Loss of biodiversity, climatic change, and soil erosion are all on the rise as a result.

Enhancing the Legal System
China's legal system has long been criticized for its lack of transparency, ill-defined laws, weak enforcement capacity, and poorly trained lawyers and judges. Over the past decade, however, the government has made great strides on the legislative side, passing upwards of 25 environmental protection laws and more than 100 administrative regulations, in addition to hundreds of environmental standards. While the quality of some of these laws could be improved, China's environmental law-makers have demonstrated increasing sophistication in their understanding of how to negotiate and draft a technically sound and politically viable law. They also have taken to publishing some draft laws and regulations on their websites to invite public comment, an important improvement in the transparency of China's legal system. Still, there are numerous weaknesses within the judicial system, including the poor or complete lack of training of lawyers and judges, the intervention of external political or economic factors into the judicial decision-making process, and the difficulty of enforcing poorly written laws.

Implications for China and the United States The rapidity and magnitude of the changes that are taking place in China and the complex way in which these changes are interacting and transforming the country leave both the Chinese leadership and the international community searching for an understanding of what China might look like over the next decade or two. While the environment has certainly moved onto the leadership's agenda over the past decade, it remains far below center priorities such as economic development, maintaining social stability, and enhancing military capabilities.


For the United States, cooperating with Chinese actors on environmental protection offers the opportunity not only to serve U.S. environmental interests but also to pursue top priorities in the Sino-American relationship: the advancement of human rights and democracy, the development of a more transparent legal system, and greater access to the Chinese market for U.S. goods and services. It is an especially opportune time to pursue such goals given the overall relatively positive state of U.S. relations with China.