Research on the Environmental Impact of China's Joining the WTO

Author: Ye Ruqiu, Editor-in-Chief
Publisher:
Publish Date: 2004-12-01
Features: China's entry into the WTO has profound implications for both China and the world. The entry into the WTO has had a significant impact on China's economy, attracting widespread attention. It has also had undeniable important effects on the environment. In the process of comprehensively building a moderately prosperous society in China, the entry into the WTO has provided important opportunities for China to implement sustainable development strategies in the economic, social, and environmental aspects, as well as to strengthen environmental management, while also presenting challenges.
After joining the WTO, trade liberalization will lead to rapid growth and expansion in the economic activities of some domestic sectors, while the economic activities of other sectors may contract. The different changes in these sectors will bring different environmental consequences, necessitating adjustments and improvements to the current environmental policies to ensure they are coordinated with the pace of national economic development. The growing sectors are dynamic and generally innovative, and such industries can often protect the environment without compromising growth—textiles is a prime example. Trade liberalization can not only promote production but also make products more affordable and of higher quality, creating consumer surplus. Appropriate environmental measures can potentially use this consumer surplus for environmental protection.
After joining the WTO, China's automotive industry has seen this situation, where the significant drop in car prices has provided a rare opportunity to introduce higher emission standards. Due to lower prices or higher quality of imported products, trade liberalization can lead to the contraction of some economic sectors. These sectors are typically less innovative and fail to benefit from emerging opportunities. The special environmental issues of these contracting sectors should attract the attention of policymakers, as these issues are highly challenging in the field of trade and the environment.
This report is a part of the comprehensive research efforts of the research team over the past 18 months, jointly completed by a group of senior domestic and foreign experts, as well as government officials from the Ministry of Environmental Protection and the Ministry of Commerce.