Green GDP for China

["Henry C.K. Liu" <hliu@xxxxxxxxxxxxxx>]

Xinhuanet (PRC)
3/11/04

Green GDP system to debut in 3-5 years

   BEIJING, March 11 (Xinhuanet) -- The Chinese
government is working on the criteria and indexes of a
green GDP, which deducts the cost of environmental
damage and resources consumption from the traditional
gross domestic product, and the new set of criteria is
expected to be finished in three to five years.
   Xu Xianchun, director-general of the department of
national accounts of the National Bureau of Statistics
(NBS) of China, tolda Xinhua reporter Thursday that
the NBS has started the work to set up the calculation
system of the green GDP, and some pilot provinces and
cities have also been chosen.
   Xu said as the Chinese central leadership is
turning to a scientific concept of development which
calls for an overall, coordinated and sustainable
development, more Chinese local governments have shown
great interest in introducing the green GDPconcept
into their economic development calculation systems.
   Xu said the Chinese government is paying more
attention to the importance of environment and
resources in the economic growth. The change can be
seen in the NBS's latest publication, Statistical
Communique of the People's Republic of China on the
2003 National Economic and Social Development.
   He said, for the first time, the Communique added
a special section on resources and environment,
briefing the influence of economic development on
resources and environment.
   Also a senior statistician of the NBS, Xu said the
green GDP deducts from the traditional GDP the costs
of resources consumption and environmental loss due to
economic activities, andit reflects a different
national economic growth rate with the GDP.
   Xu said the green GDP can help people understand
the costs of resources and environment during the
economic development, urging people to realize that it
is unreasonable to purely seek economic growth while
ignoring the importance of the resources and
environment.
   China is facing the problems of over-consumption
of resources in pursuit of rapid economic growth, said
Xu, adding that the pureconcept of GDP fails to
reflect the influence of economic growth on the
resources and environment.
   Xu said the green GDP is a scientific concept
adopted to evaluate a country's economic development,
but he noted that currently there is no country in the
world that can establish a whole set of green GDP
criteria, which includes not only the indexof green
GDP, but also the detailed quantity and value for all
consumed resources and environmental damage.
   Xu said the only way for China to set up the whole
system is towork from the very beginning and all local
Chinese government eager to adopt the new index as
early as possible must realize that the establishment
is "a very long process".
   According to Xu, China at present still faces
difficulties in evaluating the loss of resources and
environment incurred by economic activities.
   Xu said at the first stage, the NBS plans to adopt
the calculation methods the United Nations enshrined
in its comprehensive environmental economic account
system.
   Xu said the whole green GDP system of China is
expected to be created in three sequences, with the
first step working on quantity of natural resources
consumed in economic activities, thesecond step on
quantity of environmental loss caused by economic
development, and the last step on valuing the quantity
of resources and environmental loss.
   According to Xu, the NBS has decided to choose
land, forestry, mineral and water resources as the
first group of resources to make quantity account. The
NBS is also working on the "energy resources account",
which will help calculate consumption of energy
resources during the economic growth.
   The NBS will also expand the experimental scope in
the coming years, said Xu. He said, besides Chongqing
City and Hainan Province, the NBS will choose more
regions to launch more green GDP indexes so as to
promote the establishment of the whole green GDP
system in China.