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Air Pollution

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Submitted By zerobaby
Words 5493
Pages 22
2007

Forum: China’s Rapid Economic Growth and Resultant Negative Externalities

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CHINA’S RAPID ECONOMIC GROWTH AND RESULTANT NEGATIVE EXTERNALITIES

PATRICIA BLAZEY*

I

INTRODUCTION

China’s economic growth over the past fifteen years has turned it into the world’s major manufacturing base, making it one of the world’s four largest economies.1 During this period, China’s average annual real Gross Domestic Product (‘GDP’) grew by 9.7 per cent peaking at 11.9 per cent up to the second quarter in 2007, the highest growth rate over that period of time.2 At the same time the negative environmental externalities of economic growth have escalated and are causing concern not only within China itself but also globally. China has suffered severe ecological destruction and serious environmental problems which threaten both its economy and the health of its people. Apart from air and water pollution, unprecedented growth in household and industrial waste, loss of biodiversity, felling of rain rainforests and overfishing has occurred. On a global level, China’s air pollution levels have contributed substantially to the negative effects of climate change. China’s rapid growth has been accelerated through its membership of the World Trade Organization (‘WTO’)3 and policies of trade liberalisation. Foreign investment has escalated due to preferential tax treatment and the relaxation of bureaucratic obstacles which in the past had slowed down the process of getting projects up and running. Special Economic Zones (‘SEZs’) set up in coastal provinces in order to encourage foreign investment because of easy access to port facilities have proven to be highly attractive to foreign investors. SEZs offer special incentives such as lower taxes, tax holidays, local tax reductions and greater independence in international trade activities. Today there are many such zones

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