Ramping up its export juggernaut and taking full advantage of WTO entry, China’s economy in the first decade of the new millennium was “boom with no bust.” The information revolution fed more growth, as hundreds of millions of Chinese came online. But the Internet also became a forum for discontent, and the new leadership team of Hu Jintao and Wen Jiabao acknowledged growing environmental and social justice concerns with their call for a more harmonious society. Then, as the credit crisis in the US spread into a global economic crisis, China’s export-dependent growth appeared in jeopardy, and fears of a Chinese crash surfaced. But, as in 1998, China weathered the storm, and emerged in 2010 as the world’s largest exporter, largest foreign creditor, and fastest growing major economy, poised to soon surpass Japan and eventually eclipse the United States as the biggest economy on the planet.
Director for Asia Studies, Council on Foreign Relations
Elizabeth Economy is the C.V. Starr senior fellow and director for Asia studies at the Council on Foreign Relations. Economy has published widely on both Chinese domestic and foreign policy. Her most recent book, The River Runs Black: The Environmental Challenge to China’s Future (Cornell University Press, 2004), won the 2005 International Convention on Asia Scholars Award for the best social sciences book published on Asia, and was named one of the University of Cambridge’s Top 50 Sustainability Books in 2008 and one of the top ten books of 2004 by the Globalist. She has published articles in foreign policy and scholarly journals including Foreign Affairs, Harvard Business Review, Survival, and Current History; and op-eds in the New York Times, the Washington Post, and the International Herald Tribune, among others. She is a frequent guest on nationally broadcast radio and television programs, has testified before Congress on numerous occasions, and regularly consults for US government agencies and companies. Dr. Economy received her Ph.D. from the University of Michigan, her AM from Stanford University and her BA from Swarthmore College.
I think that the advent of President Hu Jintao and Premier Wen Jiabao helped to crystallize a new understanding of the importance of the environment and how the environment related to a number of different things that were more important to the Chinese leadership. And when they came in with their ideas about harmonious society, I guess this was about '02-'03, it was really a broader effort, that encompassed the environment, that said, “We’ve had 20 odd years of pell-mell, unfettered growth. Now, we look and we see there are many, many negative ramifications of this growth and the environment was one of them. How do we bring the environment back in sync?” So, I think this was a moment when they realized that the environment actually could hinder economic growth. If you don’t have enough water to run your factories, as happened in Xi'an at one point, for example, you don’t have economic output. So, land is becoming degraded and villages are becoming submerged in sand, as is happening in northern China, and then, you have tens of millions of migrants, environmental refugees, within your own country. They have to find new jobs, new housing and develop a new educational infrastructure for these people. There are enormous costs then, that are associated with what had seemed to be, essentially, a free ride.
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