Chinese walker

Olivia Boyd: Six months ago, you launched a report urging the British government to speed up its carbon capture and storage (CCS) programme. How much progress has there been since then?

Geoff French: I`m not convinced that things have moved on much. Our government has said it wants to fund four trial projects to be phased in from 2014. But, to the best of my knowledge, only two candidates have come forward, both in Scotland. One is in Fife and one is in Hunterston. [German utility] E.ON also has a proposed plant at Kingsnorth in Kent, but has said it will delay an investment for up to two to three years, based on the global recession.

Given what the country has pledged to achieve by 2020 and 2050 in terms of emissions cuts, the Institution of Civil Engineers (ICE) has been trying to encourage ministers to move forward with a bit more urgency on this. We want government to support industry, we want the results to be produced as quickly as possible and we want carbon-pricing regulations that support the behaviour we need, irrespective of the fact that it will undoubtedly make energy more expensive – that`s just something we have to accept.

OB: Assuming all of that did happen, what would be a reasonable timescale in which to expect commercial-scale CCS to be implemented widely? People talk about new technologies taking 30 years to get established. Need it take that long?

GF: I would like to think it doesn`t have to take that long. But, realistically, it will be 20 years before it is widespread. If we are only now talking about implementing pilot schemes, it will probably be the late 2010s or 2020 before we get those up and running. And, after that, we need to scale up – to go from proving it works to implementing it on a mass scale.

That needs to happen as quickly as possible and we shouldn`t wait around to get a perfect solution. If we come up with a half reasonable idea, we should be implementing it and then improving it later. When Henry Ford made the first mass-produced car, which did all of 10 miles to the gallon, people didn`t sit around and say “Good idea Henry but come back in 50 years time when you`ve got the fuel consumption up to 40 miles a gallon.” The concept of grasping what you can and continually making improvements is a good one.

China is very good at that. It has really demonstrated an ability to take ideas and plans from concept to implementation much more quickly than we have in the west. The Olympics is one example. The implementation of a high-speed rail network is another. Whatever you can think of, the Chinese have done it at a scale and speed, which, frankly, the United Kingdom can only imagine. So I would have thought, for China in particular, there is an opportunity here.

OB: Other regions including North America and the Middle East seem to be pushing ahead with CCS more quickly than Britain. What`s the reason for that?

GF: It seems to me that some of the other countries have different drivers. Canada has implemented a bit of CCS but it had a vested interest because it was using the carbon dioxide it was pumping back into the ground to enhance oil and gas production. In the Middle East, there is some CCS but it is actually being used to reduce the carbon-dioxide content in the natural gas that`s coming out of the ground – they have to get rid of the carbon dioxide before they can sell it. So there`s a vested interest. This is an important point because, unless you can arrive at a situation where you`ve got the economic drivers encouraging the behaviour you want, you are trying to push water uphill.

Regulation can help with that. The European Union has said that, from 2013, permanently stored carbon dioxide will be considered “not emitted” under its revised Emissions Trading Scheme. That sounds like a fairly simple thing. But actually, if you`re going to start carbon trading, it`s a huge step forward – suddenly you`ve got a big incentive. Take waste management as an example. Recycling and waste-to-energy plants in Europe are much more common than in the United States, by a degree of magnitude. And when you get down to it, it`s actually the regulations that have been put in place – landfill tax or other regulations – which have affected behaviour.

OB: The UK recognised the potential of CCS very early and was the first country to launch a competition to build a full-scale system. But that programme is now running years behind schedule. What has gone wrong and what lessons are there for other countries?

GF: I think there is a slight mismatch between the stated intentions, which are very good, and doing the things that will actually encourage people to come forward with these schemes. That partly comes down to carbon pricing. People can see that CCS is a good thing and that it is required in the long-term. But they would rather do it if there was an economic benefit and the economic benefit depends on there being a carbon price with a sensible floor level. We don`t want a carbon price that fluctuates wildly and we certainly don`t want a carbon price that can float back to zero, because then there`s no economic driver.

That thought tends to send people into wild panics about distorting the free market but there is no way around it. You can`t have a situation where you invest in something now because you think the carbon price is going to be at one level and then the price plummets because of some technical issue. If you`re faced with that uncertainty and you`re a commercial business, why invest? It seems to me that, if Europe can come together to tell Greece what to do to stabilise the eurozone, it shouldn`t be beyond their wits to come together to sort out a carbon price.

OB: What else would you like to see from government at this point?

GF: We need a more realistic roadmap for CCS development in this country. We can`t keep having targets that don`t get met. Of course you have to set stretching targets but, if they go too far, they become counter-productive. People just say “that`s impossible” and you lose all the drive.

If necessary, I would also like to see more financial help to try to get some of these pilot projects started as quickly as possible. That`s politically difficult at the moment but, if you believe that climate change is a universal problem that needs to be addressed, then it`s a pretty good place to choose to put your money.

OB: I`ve heard the argument put forward in the United Kingdom that CCS is an expensive distraction and government should instead be focusing public funds on nuclear new-build, a programme that is currently being left to the private sector. Do you think that argument is at all justified?

GF: There`s more justification for that argument in the United Kingdom than there is in, say, India or China, where 70% of the power comes from coal. Here, it is around 30% of our electricity. But that is still a significant chunk. I think our energy policy should be diversified. I`m not a great fan of nuclear because of what it leaves behind but I don`t see any other option if we are to reduce our dependence on fossil fuels. I`m very much in favour of renewables but even when you take into account all of the installations that can sensibly be put in, it`s not enough – you need something else. And nuclear is the only thing I can see that can fill that gap.

However, we will still be using fossil fuels for some time and so we have got to do CCS as well. I don`t think we can afford to ignore one important aspect. It is better if our energy supply is diversified and not too reliant on one sector.

OB: How much room is there for international collaboration on CCS?

GF: Enormous room. It has almost become a clich%26eacute; but we are all affected by each other`s pollution so the response needs to be international. The issues are global and the opportunities are global.

Input from China will be vital, I think. In global climate talks and elsewhere, China is beginning, quite rightly, to exert its muscle, to make its voice heard. With that position comes responsibility. China has demonstrated a fantastic ability to convert ideas and concepts into reality. It has done it primarily for the economic wellbeing of its people and its succeeding incredibly well. But I would argue that it`s time to extend that into environmental wellbeing. We need the biggest contributors of carbon dioxide, the biggest nations and the biggest users of fossil fuels to stand up and really be counted on this one.

Olivia Boyd is assistant editor at chinadialogue.

Geoff French is vice president of the Institution of Civil Engineers, vice president of the International Federation of Consulting Engineers and chairman of Scott Wilson.

Homepage image from Scott Wilson Group

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Dialogue Climate_change, development, Energy

The document now facing me, from the Kunming City Planning Commission Office, in the south-west Chinese province of Yunnan, is certainly worth a read. It states that in project planning for residential apartments under 40 storeys in downtown Kunming, “approval in principle is no longer required except as regards urban landscape considerations, requirements for aircraft clearance and controls on land construction sites%26hellip; detailed plans for %26lsquo;urban village` remodelling will, in line with this, undertake a comprehensive reorganisation.”

Let`s stop for a moment and consider the contemporary landscape of greater Kunming. There are now 330 areas classified as “urban villages” covering 18 square kilometres in the main city construction zone. Imagine, if you will, all this “remodelling” of the urban villages as a form of “strip integration”, which draws in neighbouring localities – even those that were outside the initial demolition and remodelling plans. A recent example is the urban village renovation of Panjiawan in Kunming. Although this urban village is only 39 acres (0.16 square kilometres), the area to be demolished is 129 acres (0.5 square kilometres).

Imagine now the picture of this future city: high-rise towers; every residence over 40-storeys high; the concrete forests and steel cities interspersed, of course, with green space and plazas. Imagine the legendary “Oriental Geneva”, the “bridgehead to south-east Asia”, the “Radiant Garden City Beautiful”.

This is no isolated case, but increasingly a model of Chinese urbanisation. I call this sort of city renovation and urbanisation “urban dinosaurisation”. The dinosaurs refer the enormous bodies formed by this urban expansion; to the unsustainability of this urban development; and also to their eventual, dinosaur-like fate. It can be fairly predict%26shy;ed that the cost of these dinosaurs will not be borne by those who created them: the city leaders, planners and real-estate developers. These people will leave early – and the price will be paid by those living in these areas.

It`s not going too far to call such cities dinosaurs. While satisfying a modernist desire to gaze over the human realm from some cosmic vantage point, such high-rise communities are hollow and will extinguish the intrinsic vitality of the city. In the cities of China today, vitality comes from three types of residential areas. First, traditional neighbourhoods like the hutongs of the Xuanwu and Chongwen districts of old Beijing. These have centuries of history; the city`s life was formed in these neighbourhoods, with their mixtures of residents always in view of each other. Second are the work unit communities formed in the 1950s. While the architecture of these areas is unremarkable, they have, like the older city neighbourhoods, social capital and vitality.

Third are the urban villages: city communities formed in a village framework. These are completely stigmatised in the current urban remodelling movement. However, as serious researchers and those who have lived in these places will attest, they are the same as the first two types of urban community in terms of being places that are functionally intact and orderly (albeit not in the eyes of city leaders), and whose residents are in close contact in a liveable environment.

It is these places that extend the life of the city, and promote the vitality that the modernist dinosaur city wants to extinguish. Can communities in the dinosaur city promote urban vitality? When a host of such communities emerged in the 1990s, planners designed ideal social spaces for these places, such as democratic homeowners` committees and market-oriented property management systems. But still the most fundamental problem of these communities remains: the impossibility of the community to organise and the difficulty of forming committees of homeowners, leaving residents to skirmish with – rather than resist – the property companies.

Superficially, these areas look bright, but apart from minority groups of residents brought in from work-units that bought their housing collectively, they cannot properly solve residents` or management problems. A great deal of social scientific investigation has confirmed this view. Such modernised communities need several decades of people living among each other before enough vitality gathers to change them from being empty giants.

Urban dinosaurisation is reflected further in the city`s external expansion and its engulfing of land and other resources to sustain it. Let me stay with Kunming as a case I know well. The area of the entire Dianchi Lake watershed is 2,920 square kilometres. Counting the plains and basin alone, the area is only 590 square kilometres. According to official plans, the central city area of Kunming should have been confined to 164.25 square kilometres by 2010, but the main urban region of Kunming already reached 249 square kilometres in 2008.

The consequences of such “urban dinosaurisation” have already been expressed by experts on resources and ecosystems. Following this year`s devastating drought in the Kunming region, experts pointed out that one of its causes was the rapid advance of urbanisation in the Dianchi Lake Basin, which has brought the capacity of its supporting water resources to the limit.

A muck-rake farmer by Dianchi Lake

Another example is the insertion of the north-south Kunluo Road, which extinguished “muck-rake” farming – where crops are planted in raked, muddy flats – along the east coast of Dianchi Lake: the route of the road destroyed irrigation system built in the 1950s, so that a place that in former times maintained high yields has been turned into one of alternating droughts and floods. Such roads also intensify urban expansion: once there is a road, property-development frenzy ensues. Kunming in the pre-drought years was already one of the nation`s 14 most water-stressed cities. This may seem ridiculous, but it`s true.

My warnings about urban dinosaurisation were once based on the notion that the dinosaur-makers entertained a na%26iuml;ve, modernist aesthetic. But I see that, in fact, all the 40-storey buildings imagined by these people are nothing but heaps of silver reaching to the sky, from the huge land transfer fees arising from urban village demolitions to the astronomical prices of the buildings and the so-called political merit that results. Such are the dreams of the dinosaur creators.

So, how can we put an end to urban dinosaurisation? Let`s start by giving up on the utopia described by Jane Jacobs as the “Radiant Garden City Beautiful”. The violence of profit-driven demolition and construction finds legitimacy within the enchantment of this utopian ideal, while the world of daily life of countless people meets its end. Let us hold fast to each “decrepit” neighbourhood and compound, and firmly reject the hard and soft violence of this silvery utopia. If we take this stand, we can stop the spread of the urban dinosaurs.

Zhu Xiaoyang is associate professor of anthropology in the Department of Sociology, Peking University.

This article first appeared in Southern Weekend. It is translated and reproduced here with permission.

Homepage image by Philou.cn

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Dialogue development, Drought, Urbanisation, Water

China is poised to present the world with some of its greatest opportunities – as well as some of its greatest challenges – in the years ahead. The planet`s most populous country is now home to 1.3 billion people. It is also home to a rapidly developing economy that is fast becoming a major global player. The spectacular rise of China has lifted millions out of poverty. It has also alarmed many of its neighbours and competitors and prompted the question, “Is China a threat or an opportunity?” Its rapid development has come at a heavy environmental cost.

The Chinese government acknowledges China`s environmental crisis. In a 2005 interview, Pan Yue, vice minister of the State Environmental Protection Administration (SEPA), the government agency with responsibility for the environment, said: “This [economic] miracle will end soon because the environment can no longer keep pace%26hellip;Acid rain is falling on one-third of our territory, half of the water in China`s seven largest rivers is completely useless; a quarter of our citizens do not have access to clean drinking water; a third of the urban population is breathing polluted air; less than a fifth of the rubbish in cities is treated and processed in an environmentally sustainable manner.”

China`s need for energy and water to feed continuing urbanisation and industrialisation will only exacerbate this crisis if solutions are not found. However, the country`s environmental problems are of concern not only to China; they affect everybody in the world, directly and indirectly. As China expands its search for energy and minerals, timber and other raw materials across the world, the environmental impact becomes a global issue. According to the Washington-based Worldwatch Institute, China used 26% of the world`s crude steel in 2005, 32% of the rice, 37% of the cotton and 47% of the cement. While some of those materials are going into exported products, a good deal is going into building a Chinese infrastructure that is transforming the country`s landscape. And as China`s carbon emissions rise, the common problem of global climate change is affected.

Since the late 1970s, the country has moved from a centrally planned system to a more market-oriented one, with a burgeoning private sector. China`s economic restructuring, with its accompanying gains in efficiency, have led to a huge leap – more than tenfold — in gross domestic product (GDP) since 1978. Measured in purchasing power, then, China has become the second-largest economy in the world, after the United States. In per-capita terms, however, it is still lower middle-income, with large income disparities between regions and 150 million people falling below international poverty lines. The Chinese government has struggled to cope with both the consequences of past environmental policies and the challenges of the current economic transformation. With China`s growing national wealth, its rapid urbanisation and its economic weight in the world comes new responsibility regarding a tidal wave of environmental issues – issues of environmental protection, conservation of resources, power-generating capacity, fossil-fuel use and much more, which need to be urgently addressed.

Today, environmental issues are confronting every country in the world, large and small, powerful and weak. For China, with its huge population, colossal energy needs, growth in consumerism, expanding industrialisation and, soon, the 2008 Summer Olympic Games taking place in its capital, Beijing, the demands on its environment will be staggering. How will the country cope? And how will China work to ensure that it does no harm to places — and resources — outside its national borders?

Along with having the second-largest economy on the planet, China is the world`s second-largest emitter of carbon dioxide (CO%26sup2;), one of the major greenhouse gases that contribute to global warming. Although China has ratified both the 1992 United Nations Framework Convention on Climate Change and its 1997 Kyoto Protocol, as a developing country it is not legally bound to any emissions-limiting or emissions-reduction targets. Nor, notes the UN Environment Programme`s Global Environment Outlook 2006, have any targets been set under the 2005 Asia-Pacific Partnership on Clean Development and Climate, which encompasses China and two of its regional, developing neighbours – India and South Korea – along with the US, Japan and Australia. (India and Japan are the fourth and fifth largest CO%26sup2; emitters, with Russia in third place.) The partnership, however, aims to develop and utilise emerging cleaner technologies and practices, including renewable energy systems.

In 1990, according to UNEP figures, the Asia-Pacific region produced 435 million tonnes (8%) more CO%26sup2; than did North America. By 2002, the disparity was 2.6 million tonnes (41% more). Figures cited by the Worldwatch Institute show China emitting one billion tons of carbon dioxide annually, or 14% of the world total (still only one-seventh of the level of the US, the world`s largest emitter). Pressure on China to limit its greenhouse-gas emissions, post-Kyoto, is mounting, both internationally and internally. The Chinese government is well aware that China is vulnerable, on many fronts, to the effects of climate change: rising sea levels, violent weather fluctuations, desertification, loss of habitat and biodiversity, health issues, and more.

San Francisco-based Pacific Environment, one of the organisations supporting China`s emerging environmental movement, says that “China`s contribution to global warming will impact the environment of every nation on earth.” Indeed, it adds, the country`s management of its environmental problems will have significant global repercussions. “The inability of China`s farmers to eke out a crop from drying land will force it to turn to the world food market, further intensifying the stresses on land in grain-producing countries like the US and Canada. And China`s consumption of over a third of the global fish harvest, a number that is certain to grow, is placing severe strain on our already overtaxed oceans. Simply put, anyone concerned about the global environment must be concerned about the capacity of China`s people to deal with the pressing threats they face.”

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Dialogue Briefing, development, Pollution

The last two hundred years have seen many shocks for China. The world`s biggest economic power at the beginning of the 19th Century, with an economic aggregate at 33% of the world`s total, China quickly declined to only 5% by the mid 20th century. The decline was not arrested until 1950 and industrialisation and modernisation began from a very low economic level. From 1978, China`s economy began to take off, generating the biggest economic miracle in human history and achieving record breaking growth and poverty reduction. Today, China is already the world`s second largest power in terms of comprehensive national power and, according to PPP (purchasing power parity) calculation, is now second only to the United States and predicted by the OECD to overtake the US by 2030, thus becoming the world`s biggest economic power again (See Table 1). For China, national reinvigoration is no longer a dream. The rise of China is a living reality.

The rise of China has aroused great concern throughout the world. Most people in the world hold that China`s development will make a positive contribution. But some also claim that China`s growth is a threat. I think the rise of China will provide the world with opportunities rather than threats and that the whole world will benefit from China`s development. In fact, over the past 20 years, China has already made a tremendous contribution to global growth and poverty reduction. China`s future development will mean a greater contribution still. But the prerequisite is that China`s growth must be grounded in its true national conditions and follow the right development path. I think that China should rise both peacefully and along the path of green development. Only by sticking to a green development strategy and shifting the growth model to a green development path, is it possible for China to realise its historic rise. Table 1 Proportion of China`s GDP in the World`s Total

Source：Angus Maddison, The World Economy: A Millennial Perspective, OECD: Paris, 2001

China`s resources, environment and the loss of natural assets

China abounds in natural resources. But on a per capita basis, it is a resource poor country. According to the World Bank`s 1997 evaluation, among the big countries whose data are available, China`s natural capital was next only to the United States and India. But on a per capita basis, it ranks at only 2670 US dollars, slightly higher than Japan (2300 dollars), 68% that of India, 64% that of Germany, 54% that of Britain, 33% that of France, 16% that of the United States, and 7% that of Australia. China`s agricultural land is 75% of its natural capital, second to India in total value; energy and mineral resources are 16% , with a total value next only to the United States. These two items together form the main part of China`s natural capital. But environmental natural resources are scarce. The value of forest resources, timber, pasture and protected zones in the United States is respectively, 2.7 times, 4.5 times, 5.4 times and 10.8 times that of China. (See Table 2)

China has big natural capital reserves but it is a small country on a per capita basis and the quality of its capital is poor. The contradiction between population and resources has always been significant in China`s productivity and economic development.

Table2 Natural Capital in Different Countries（1994）

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Dialogue development

Green development is the inevitable path

The traditional development strategies of industrialised countries all present two distinct features whether in Europe, the United States or Japan, despite their differing national and development conditions. One is that high-speed growth is sustained by high consumption of resources (especially non-renewable resources); the other is that the high-speed growth is stimulated by high consumption of the means of subsistence. We call this a traditional development model. In view of China`s conditions, it is impossible for China to realise modernisation by following the traditional model. The six principal reasons are:

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Dialogue development

If a nation is to develop, particularly in this increasingly globalised world, it needs energy – energy to power its factories, supply its construction industries, light its buildings, heat and air-condition its homes and workplaces, run its transportation systems, and produce its food and clothing.

China, with its booming economy and increasing national wealth, is (like its neighbour India) not immune to the environmental consequences of its development, however. The doubling of its gross domestic product (GDP) since 1995 (from about US $500 billion in 1995 to $1.1 trillion in 2005) has produced a concomitant increase in carbon emissions, from roughly 800 million metric tons in 1995 to more than 1.2 billion metric tons in 2005. China has a great deal of growing to do yet, however, and 150 million Chinese people are still living in poverty – and using very little energy.

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Dialogue Briefing, development, Energy

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Dialogue Air, Briefing, development, Pollution, Water

The climate crisis results from a tragic misallocation of financial resources towards activities that fail to account for their environmental impacts. If we are to make the bridge to a secure climate future, then fresh thinking is urgently required on how to steer the world`s immense investment resources towards energy options that simultaneously deliver sustainability and decent returns for the world`s savers. The task ahead is daunting, but early signs are promising.

The total value of all the companies listed on the world`s stock markets now amounts to over twenty trillion US dollars ($20,000,000,000,000). To date, precious little of this store of financial wealth has taken account of the cost of carbon emitted from these companies` products and processes. And, looking ahead, business-as-usual projections from the International Energy Agency suggest that over $16 trillion will be invested in the world`s energy infrastructure up to 2030, mostly in fossil-fuel facilities, generating an additional 60% in greenhouse gas emissions. All indications suggest that this capital will be mobilised.

The multi-trillion dollar question is therefore how to mould those old financial drivers of “fear and greed” so that they work with the grain of a low carbon future rather than against.

This process has already started. The introduction of the European Union Emissions Trading Scheme on 1 January 2005 has transformed the way that financial markets value companies affected by the scheme. The scheme has created a new market in carbon dioxide allowances estimated at some Euro 35 billion (US$43bn) per year, potentially rising to over Euro 50 billion per year by the end of the decade. Investment banks now regularly factor in a cost of carbon into their valuation spreadsheets for affected sectors. For Chris Rowland, a leading City analyst, “it`s possibly the biggest change the European utilities industry has seen since the industrial revolution”.

The carbon caps might not have been as tight as many had hoped, but already the price for carbon dioxide allowances has risen from just Euro 7 in April 2004 to over Euro 28 in April 2006. This is equal to the UK government`s mid-point estimate of the actual damage done by a tonne of carbon dioxide of %26pound;19 (Euro 28).

It should be noted how easily financial markets absorbed this shift in costs. The sky hasn`t fallen in, and capital has started to move to those companies best positioned for a carbon-constrained future.

Climate change and the investment chain

Other parts of the investment chain have also taken action. The socially responsible investment (SRI) community has been at the vanguard of the shift. At my firm, Henderson Global Investors, we now see long-term growth opportunities in the companies providing solutions to climate change, whether in cleaner energy systems, efficiency enhancements or sustainable transport systems. In 2005 we also commissioned Trucost to carry out a pioneering carbon audit of one of our Sustainable and Responsible Investment (SRI) funds, which shows that incorporating sustainability factors into the selection of investments can yield real environmental benefits for investors.

More broadly, the Carbon Disclosure Project has mobilised 143 leading institutional investors to request improved disclosure on climate change from the world`s leading 500 companies. And at the recent Institutional Investor Summit on Climate Risk in New York, two dozen US and European institutional investors with over three trillion dollars of assets under management issued a ten point call to action. This urged pension funds, fund managers, companies, and financial regulators to intensify efforts to provide the analysis and disclosure needed to manage climate risks. The group also committed to deploy $1 billion towards business opportunities emerging from the drive to reduce emission.

These are all positive developments, but they will still be insufficient to tip the investment balance unless smarter policy frameworks are introduced. Even in the UK, where the government has developed a relatively sophisticated approach, the word “investor” is still strangely absent from its climate change programme. Certainly, making sure that the cost of carbon is reflected in commodity prices is a necessary step – and large funds, such as those backing the Institutional Investors Group on Climate Change now support the UK`s long-term carbon reduction target of 60% by 2050.

Markets and a climate-constrained world

But to be truly “joined up” from a financial perspective, policy should also address other parts of the investment chain. Financial regulation now lags behind economic realities. This means it is still possible for companies to list on the world`s leading stock markets without disclosing potential carbon costs and liabilities; this gap needs to be closed.

In addition, the duties of investors need to be brought into line with a carbon-constrained world. Managers of institutional investments – whether pension or mutual funds – are governed by the concept of fiduciary duty, ensuring that their decisions are prudently made in the best interests of the end-beneficiaries. This has commonly been interpreted as meaning the maximisation of short-term returns, without regard to wider social or environmental realities. The harsh facts of climate change – along with other sustainability threats – should prompt governments to modernise this interpretation. Inspiration can be sought by looking once again at the long-standing “prudent investor rule”, challenging trustees and managers to recast the ancient virtue of prudence in light of climatic realities.

Financial markets move on sentiment, and investors are now awakening to the deep risks associated with climate change and the potential opportunities in finding ways to respond effectively. By updating financial regulation and investor duties to take account of carbon, governments would not only make the achievement of climate goals more likely, but could also help secure stable investment returns at a time of a global pension crisis. The prize is clear, and it`s worth at least twenty trillion dollars.

Nick Robins is head of socially responsible investment research at Henderson Global Investors in the City of London.

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Dialogue BUSINESS, Climate_change, development

The United Nations has declared 2006 as the International Year of Deserts and Desertification, in recognition of the grave perils of desertification, a global phenomenon affecting a third of the earth`s surface and more than one billion people in over 100 countries. As susceptible dryland areas lose their productive capacity, says the UN, desertification has potentially devastating social and economic consequences, including poverty, famine and political instability.

Acknowledging those connections, the UN Convention to Combat Desertification was established after the 1992 Earth Summit in Rio de Janeiro. The convention defined desertification as “land degradation in arid, semi-arid and dry sub-humid areas resulting from various factors, including climatic variations and human activities”, and is the first international treaty to address the issues of poverty and environmental degradation in rural areas. It also is the first pact, says the UN, to “recognise that grassroots resource-users are central to identifying and implementing solutions”; to involve local women as well as men in the development process; to stress the need for an integrated approach, and to call for a global mechanism to mobilise resources through partnerships. (At the 2002 World Summit on Sustainable Development, the convention was singled out as a key instrument for poverty eradication in dryland rural areas.)

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Dialogue Climate_change, Deforestation, Desertification, development

Biodiversity – or biological diversity – means the variety of life on earth, and is measured within species, between species and in the plenitude of ecosystems (the system of interactions between living organisms and their environment). In its biodiversity, China is one of the richest countries on earth. It is also one in which biodiversity has been most seriously damaged – and is still threatened.

With its huge population and long history of agriculture, China has been cultivating its vast territory for centuries. Forests and other types of vegetation were destroyed to clear land to cultivate more crops to feed more people. Wars and other chaos throughout China`s history have had their negative effects on the land and its life forms, and now climate change is playing a part. More recently, says China`s Biodiversity: A Country Study – labeled “a preliminary summary of China`s biodiversity and of the work needed for its preservation” — both the government and the public are more aware of the importance of biodiversity conservation. But threats to the country`s biodiversity legacy – one that is rich and varied, but also broken and incomplete — are still growing.

Forests, says the 1998 report — organised by China`s State Environmental Protection Administration (SEPA) and compiled with the support of the United Nations Environment Programme (UNEP) – have been “broken into small, fragmented areas”. Rangelands have been “overgrazed and severely degraded”. Animal and plant resources have been overexploited and overutilised. Atmospheric pollution, particularly in the form of acid rain, endangers plants, soil, lakes, fish and other resources. Invasive exotic weeds and animal pests have damaged indigenous life. Human activities, including tourism, mining and wetlands reclamation, produce a range of harmful effects.

As the report unequivocally states: “The survival of mankind cannot be separated from that of other species. Numerous plants, animals and micro-organisms provide indispensable human food, fiber, wood, medicine and industrial raw materials. %26hellip; The many beautiful and aesthetic life forms on the earth also give human beings much enjoyment. They are also sources of artistic creation and scientific invention. Most of the functions of living organisms cannot be replaced by other things. Today, man is modifying the features of the earth at an unprecedented rate. This creates raw materials for human survival on the one hand, but has changed the living environment of other living things, continuously decreasing biodiversity, and has led to the extinction of large numbers of species, on the other. The basis for human survival is gradually disintegrating and the protection of biodiversity is currently of worldwide concern.”

Experts, including the UNEP, consider China one of the earth`s 12 “mega-diverse” countries, ranking it third in the world for biodiversity in GEO-2000, the Global Environment Outlook, and first in the northern hemisphere. With more than 30,000 species of advanced plants and 6,347 kinds of vertebrates, representing 10 and 14 percent, respectively, of the world`s total (according to 1996 SEPA figures). Additionally, China is credited with 1,000 species of economic trees and more than 11,000 species of medicinal plants. Countless species are endemic to the country – ancient flora and fauna – and are both rare and endangered.

Washington-based Conservation International (CI), which works to protect the earth`s richest regions of plant and animal diversity, has identified 34 “biodiversity hotspots” globally. These are regions that contain at least 1,500 endemic species of vascular plants (greater than 0.5% of the world`s total) and which have lost at least 70% of their original habitat. Among the 34 hotspots on CI`s list are the mountains of southwest China, stretching over 262,400 square kilometers of temperate to alpine peaks between the easternmost edge of the Tibetan plateau and the central China plain. The mountains feed the most species-rich temperate and tropical river systems in Asia and “support a wide array of habitats, including the most endemic-rich temperate flora in the world.”

The region has evolved into “cluster of distinctive mini-hotspots,” each with its own unique flora and fauna, says CI, due to its dramatic differences in topography, climate and vegetation. The mountains are home to an estimated 12,000 species of plants, 237 of mammals, 611 of birds, and at least 90 each of reptiles, amphibians and freshwater fish – many of which are found nowhere else in the world. Two-hundred thirty rhododendron species – more than a quarter of the world`s total – are found there. So, too, is the richest variety of pheasants and their relatives – about 25 species – and, among mammals, there is the very symbol of China and of conservation: the giant panda. The animal, says CI, is “almost entirely restricted to the shrinking forests of this hotspot.” Other important mammals include the golden monkey, the Yunnan or black snub-nosed monkey, the takin (a large goat antelope), the Chinese forest musk deer and the snow leopard.

The World Conservation Union (also known as IUCN and based in Gland, Switzerland) is the world`s largest and most important conservation network. Among its functions is maintenance of the IUCN Red List of Threatened Species, a database recognised as the most authoritative guide to the status of biological diversity on the planet. It evaluates the extinction risk to thousands of species and subspecies. Its 2006 figures list 804 threatened species in China: 442 plants, 84 mammals, 88 birds, 34 reptiles, 91 amphibians, 59 fishes, 1 mollusc and 5 other invertebrates.

Deforestation – for agriculture, logging, dam construction, industry and human settlements – and climate change have played their part in the decline of China`s wildlife and habitats. So, too, has the destruction of grasslands and wetlands – such as the large freshwater swamps of the Sanjian plain in northeastern China. While habitats shrink, so too does the varied life of ecosystems.

And as Jared Diamond writes in his book Collapse: How Societies Choose to Fail or Survive, “Other biodiversity losses with big economic consequences include the severe degradation of both freshwater and coastal marine fisheries by overfishing and pollution, because fish consumption is rising with growing affluence. %26hellip; The white sturgeon has been pushed to brink of extinction, the formerly robust Bohai prawn harvest declined 90%, formerly abundant fish species like the yellow croaker and hairtail must now be imported, the annual take of wild fish in the Yangtze river has declined 75%, and that river had to be closed to fishing for the first time ever in 2003.”

As China pursues its aspirations to a “First World lifestyle,” the impact on human-resource use and the environment is certain to be immense.

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Dialogue Biodiversity, Briefing, Climate_change, development