More hope for China
http://today.reuters.co.uk/news/CrisesArticle.aspx?storyId=SP197210&WTmodLoc=World-R5-Alertnet-6
China sees tackling climate change as urgent-Stern
Fri 1 Dec 2006 11:16:15 GMT
(Adds World Bank comments, paragraphs 5-9 and 19)
By Alan Wheatley, China Economics Editor
BEIJING, Dec 1 (Reuters) - China's leaders recognise that tackling climate change is urgent and that reducing greenhouse gases does not mean slamming the brakes on growth, the author of an acclaimed report on global warming said on Friday.
At a news conference to outline a study he presented to the British government in October, former World Bank chief economist Nicholas Stern disputed the premise of several questions that China was not doing enough to address global warming.
"There is a sense of urgency in China," Stern, head of the British government's economic service, said. "It's important to recognise that China is moving, and moving quite quickly."
Other Western diplomats and environmental experts are less impressed, however, and privately fret that China's leadership does not regard measures to tackle global warming as a priority.
The World Bank is worried that the amount of energy China uses per unit of output has been rising since 2001, reversing a 20-year decline in so-called energy intensity.
With coal-fired stations providing over 80 percent of China's electricity supply, China is on course to overtake the United States by 2009 as the largest emitter of carbon dioxide, one of the main greenhouse gases that warm the planet.
"If that continues, that means more pollution," Bert Hofman, the chief economist in the World Bank's Beijing office, told a banking conference on Friday.
Back in 2001, the bank estimated that 700,000 Chinese died prematurely each year because of pollution, which it said translated into a loss of 5-8 percent of national output.
"One of the big drivers of that pollution is energy," Hofman said. "For China, pollution means major losses and damage at home."
Stern, though, said China deserved credit as one of the few countries where forest cover had increased and for energy-saving commitments in the ruling Communist Party's plan for 2006-2010.
"China is not waiting. China is moving ahead," he said. "I don't think there's any question of waiting for others."
MELTING GLACIERS
Stern's review said timely measures to curb greenhouse gases, and so avoid the worst impact of climate change, could cost as little as 1 percent of global gross domestic product a year.
But failure to act promptly would spell environmental disaster and cost the equivalent of 5 percent of world economic output each year, now and forever.
For China, global warming would exacerbate droughts in the north and floods in the south, in part because of the melting of Himalayan glaciers, Stern said.
He said the focus of his meetings in China had been very practical. Officials wanted to explore the transfer of technology and help with financing to clean up its coal-fired power plants.
Noting that China would implement an export tax on energy-intensive exports this month, Stern said he believed Beijing had also embraced the idea of using price incentives to encourage the move to a low-carbon economy.
"I think that principle is accepted in China, and I hope that China does go forward with these kinds of policies as part of the story of increasing energy efficiency, of encouraging technology for renewables, carbon capture and storage for coal and so on."
But Beijing still sets prices for diesel, gasoline and electricity -- some of the key generators of greenhouse gases -- which analysts say encourages waste and makes investment in cleaner technology less financially attractive.
Hofman at the World Bank said, "China has the policy tool to decrease energy intensity in its hands: increase prices."
Stern said it was the poorest countries that would suffer most if global warming was not tackled. Far from costing jobs, more efficient use of energy would save money and developing new technologies would be a rich source of growth.
"The idea that you've got to grow first and adjust later is wrong. It's one of the key conclusions of the Stern review and I think it's recognised here in China," he added.