China is choking on its economic success

  • Article by: WILLIAM PESEK , Bloomberg News
  • Updated: January 31, 2013 - 1:21 PM

The country's pollution woes are spiraling out of control. Unless China acts immediately and boldly, it's main growth industry will be gasmasks.

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A man wears a mask on Tiananmen Square in thick haze in Beijing Tuesday, Jan. 29, 2013. Extremely high pollution levels shrouded eastern China for the second time in about two weeks.

Photo: Ng Han Guan, Associated Press

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Is it already too late for China to clean up its fast-blackening skies?

For all the lip service about green growth, investments in renewable energy and sprawling windmill farms, China's pollution woes are spiraling out of control. The nation's capital is a case in point. Beijing's air, which has exceeded the World Health Organization's healthy limit every day this year, is similar to that in an airport smoking lounge, Bloomberg News reported Thursday.

The city's leaders closed factories, ordered some cars off the roads and recommended that its 20 million residents stay indoors as much as possible as pollution levels stayed in the range of hazardous for a fifth straight day. Mind you, this isn't a script from some apocalyptic movie churned out by Hollywood. It's the political center of an economy that's poised to surpass the United States's within a couple of decades.

Yet China is literally choking on its economic success. It has reached its environmental limits, and the blind pursuit of gross domestic product just isn't possible anymore. If you think Beijing's air is bad now, consider how China's skies will look when 500 million people own one or more cars. That's on top of factories maximizing profits amid rising labor costs by burning more and more coal. All this will lead to increasing health risks, slower growth, less foreign investment, increased government debt and higher bond yields.

It will lead to deaths, too. The issue is high concentrations of PM2.5, the airborne particulate matter that raises risks for lung and heart diseases. According to estimates by Greenpeace and Peking University's School of Public Health, PM2.5 exposure contributed to 8,572 premature deaths in Beijing, Shanghai, Guangzhou and Xi'an in 2012.

The problem is political will. China's next president, Xi Jinping, will have his hands plenty full consolidating power, maintaining social instability, improving relations with neighboring governments and dealing with the U.S.'s pivot toward Asia. Amid so many challenges, China's dual needs to reduce emissions and boost domestic demand are in direct conflict as never before. Unless China acts immediately and boldly, it's main growth industry will be gasmasks.

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