Dec 10, 2008

New Reports Indicate China's Water and Soil May Be Too Far Gone to Support a Growing Economy

Two new reports – one from the Chinese government, the other based on criteria developed by the United Nations – should be enough to scare every government, economist and investor in the world about the future of the Chinese economy, currently the one global bright spot.
The underlying question raised by these reports is this: How can a nation’s economy grow when its soil is rapidly eroding and its water is rapidly becoming so polluted that it isn’t just unsafe to drink. It’s even unsafe for fishing, farming and factory use.
In short, how can a nation’s economy grow when its ecosystems appear on the verge of collapse?
As reported late last month by Xinhua, the official Chinese news agency, “A three-year investigation reveals almost 40% of China’s territory, or 3,569,200 square kilometers of land, suffers from soil erosion.” Reuters news agency put it this way: “Over a third of China’s land is being scoured by serious erosion that is putting crops and water supply at risk, a nationwide three-year survey has found.” The survey reportedly was carried out by China’s bio-environment security research team.
Separately, Britain’s Telegraph newspaper ran a story late last month headlined, “Yellow River too polluted to drink.” Datelined Shanghai, the story began: “The Yellow River, which provides drinking water to millions of people in northern China, is now so badly polluted that 85% of it is unsafe for drinking. China’s heavy industries have tipped so much waste into the river that enormous stretches of it, amounting to over a third of its entire length, cannot be used at all anymore, either for drinking, fishing, farming or even factory use, according to criteria used by the United Nations Environmental Program.”
These are stunning statistics that literally stab at the heart of the world’s biggest, most populous country and the nation whose economy is desperately being counted on by a recession-savaged world.
But as much as the credit crisis has undermined economic growth elsewhere, an environmental crisis looks increasingly likely to do the same to China’s economy. Everything you need to know about Beijing’s continuing failure to come to grips with its eco-crisis can be found in a quote deep in the Telegraph story from a spokesman for the Yellow River Conservation Committee. “I wish that a harmony could be achieved between development, utilization and protection of the river someday.”
China’s water and soil woes appear to have now reached the point at which food and water shortages leading to a health crisis could be possible at any moment, leading in turn to a reduction in GDP at the exact wrong time.