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Chinese Sustainable Development : Focus on Energy


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This persentation about Chinese Sustainable development focus on energy sector. Chinese energy situation comparision with other countries.

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Chinese Sustainable Development : Focus on Energy

  1. 1. Chinese Sustainable Development Focus on Energy Khairul Anam MIDP,GSIS,SNU
  2. 2. Contents: <ul><li>Introduction </li></ul><ul><li>Energy Indicators-China’s position in world </li></ul><ul><li>- energy use, source , production, consumption, </li></ul><ul><li>consumption efficiency </li></ul><ul><li>3. Chinese High Growth and its Sustainability </li></ul><ul><li>4. Challenges to fix Growth Problem </li></ul><ul><li>- Environmental Issues and Energy use pattern in China </li></ul><ul><li>5. Conclusion </li></ul>
  3. 3. 1. Introduction <ul><li>The Chinese economy had displayed spectacular performance for whole period of 1979-2005 growing an average annual rate over 9%. Since the start of economic reform 27 years ago, the Chinese economy has also been radically transform from close system to open system in terms of trade & investment. For FDI, China has since 1990s become one of the world most favoured destination. </li></ul><ul><li>China’s highly creditable economic performance after its successful economic reform has inevitably given rise to one critical question. </li></ul><ul><li>Is such economic growth is sustainable? </li></ul>China has world largest population with fast growing economies. Over the next ten years rate of urbanisation and manufacturing sector will continue to dominate the economy. These factors clearly presage China’s continuing requirement for large quantities of energy for the foreseeable future.
  4. 4. Introduction Energy Use Increasing more than GDP
  5. 5. <ul><li>Second largest energy producer and consumer globally </li></ul><ul><li>Energy use per capita is still low - demand 3.5 times higher in urban areas vs rural areas </li></ul><ul><li>Government goal of reducing energy use by 20% of 2005 level within 2010 (in 11th five-year plan) </li></ul><ul><li>About 80% of electricity produced from coal </li></ul><ul><ul><li>High sulphur content (1-4%) </li></ul></ul><ul><ul><li>Major part not washed (60-80%) </li></ul></ul><ul><ul><li>Coal will remain the main fuel for power production </li></ul></ul>Introduction: Some Energy Facts of China
  6. 6. 2. Energy Indicators-China’s position in world. Chinese Population share to world: 20.18%, GDP share to world : 6.13% Energy Production share to world : 14.82%
  7. 7. Energy Use in China <ul><li>China currently consume ½ of total North American primary energy consumption and 70% of total European consumption. </li></ul>
  8. 8. China’s Total Energy Production & Consumption Source: China Statistical Year Book 2008
  9. 9. Source of Energy : Production Dynamics Source: Data from China Statistical Year Book 2008
  10. 10. China’s Energy Production Source: Coal <ul><li>China is the largest producer and consumer of coal in the world. </li></ul><ul><li>Recoverable reserves rank 3 rd in world. </li></ul><ul><li>By 2030 avg. annual coal consumption growth rate is expected to be 4.2% whereas world average 2.5, OECD 1.2%, non-OECD3.3 % </li></ul>
  11. 11. China’s Energy Production Source: Oil <ul><li>China is the 5th largest producer of crude oil in the world. </li></ul><ul><li>Since 1994 rate of production increase less then 2% but consumption rate increase over 7%. </li></ul><ul><li>China is the 3rd largest net importer of crude oil after US and Japan. </li></ul><ul><li>The country’s share of global oil consumption is estimated to increase from 7% in 2003 to 13% in 2030. </li></ul>Source: World Energy Outlook 2008
  12. 12. China’s Energy Production Source <ul><li>natural gas presently accounts for only 3% of total energy consumption mix, but govt. is planning for its share to 8-10% by 2010 </li></ul><ul><li>The country’s share of global natural gas production was only 0.5% and it increased at 2.2% in 2007. </li></ul>Nuclear <ul><li>The country’s share of global nuclear production was only 2% in 2006. </li></ul><ul><li>Over the next 15 years China plan to build about 2 nuclear plants per year. </li></ul>Natural Gas
  13. 13. China’s Energy Production Source: Hydro-power <ul><li>China is the largest hydro-electricity producer in the world. </li></ul><ul><li>It has highest installed capacity (118 GW) ranked 1. </li></ul><ul><li>Three Gorges dam on Yangtze river- world largest (2.3km, 22,500 MW, 32 generators) hydro project. </li></ul><ul><li>It generate an eqe. 3% of china’s total electricity. </li></ul>
  14. 14. Electricity Production China’s electricity generation at 82.1% from thermal plants, 15.4% from hydro, 2.3% nuclear and 0.1% from solar, wind etc.
  15. 15. Energy Consumption Efficiency of China Energy Intensity of different economies The graph shows the amount of energy it takes to produce a US $ of GNP for selected countries. GNP is based on 2004 purchasing power parity and 2000 dollars adjusted for inflation. China <ul><li>China is the Largest energy user but Why low energy efficiency is low? </li></ul><ul><li>supply capability hindered, </li></ul><ul><li>imbalanced distribution, </li></ul><ul><li>extensive pattern of economic growth, </li></ul><ul><li>irrational energy structure, </li></ul><ul><li>unsatisfactory energy technology & relatively poor management </li></ul><ul><li>have resulted in higher energy consumption per unit GDP and therefore energy efficiency is low. </li></ul>
  16. 16. Chinese High Growth and its Sustainability <ul><li>Is high growth is sustainable? </li></ul><ul><li>Although China’s past high growth very impressive </li></ul><ul><li>- but it is not actually so exceptional and really unprecedented if we viewed in the historical context of dynamic of east Asia –Japan and NIEs and even in 4 ASEAN. </li></ul><ul><li>- Japan is the first non-Asian country >high growth in 1950s-1960s post-war recovery,1970s>initially based on export labour intensive manufactured product > > raising wage > increase cost to shed its comparative advantage in favour of 4 NIEs. </li></ul><ul><li>This 4 NIEs most dynamics economics in Asia as had sustained near double-digit rate for 3 decades (early 1960s to 1980s). </li></ul><ul><li>China’s highly creditable economic performance after its successful economic reform has inevitably given rise to this critical question. </li></ul>Yes. If it is possible for Japan, then 4 NIEs. And why not the Chinese –first from Hong Kong, then Taiwan and now main land.
  17. 17. 3. Chinese High Growth and its Sustainability Table: China & East Asian Economic Performance Source: EID database Ref: Wong. J. Interpreting China’s Development, East Asian Institution, NUS,2007 By putting china’s economy in this context we can easily say to support long term growth prospect> China has been one of the ‘Flaying Geese’. Japan had historically over 25 yrs of high growth while NIEs had 30 yrs. China’s present run of growth cover only 25 yrs and it can easily continue for an another decade or more. In fact china’s economy is much larger and more diverse. Considering pattern of EAE growth it is not over–optimistic to say that china has the ability to sustain its high growth. 6.9 6.4 2.8 7.4 6.7 8.3 8.8 107 24,220 Singapore 6.4 7.3 3.2 3.8 6.9 9.3 10 163 26,810 Hong Kong 4.3 4.1 3.3 5.7 7.9 9.7 9.2 321 14,033 Taiwan 5.2 4 4.7 5.7 8.9 10.1 8.6 680 13,980 South Korea NIEs 6.4 2.7 1.3 1.3 4.1 4.3 10.9 4,623 37,180 Japan 10.7 10.2 9.2 9.7 10.3 5.5 5.2 1,930 1,290 China 2006 2005 2000-2004 1990-2001 1980-1990 1970-1980 1960-1970 2004 2004   Growth of GDP (%) Total GDP (US$ bn) GNP per capita (US$)  
  18. 18. 4. Challenges to fix Growth Problem <ul><li>Many problem created by fast growth from income inequalities to rural-urban disparities . It is not new but familiar. </li></ul><ul><li>As pointed by Nobel Laureate W. Arthur Lewis, all development processes are in egalitarian as development cannot take place in all economic sectors and embrace all people and all classes at the same time. </li></ul><ul><li>On the issues of income inequalities, according to Simon Kuznets-relationship between income distribution and development typically follows an inverted U-shaped curved: </li></ul><ul><li>income distribution can be equal before development but get unequal as development proceeds and it will become more equal after further development. </li></ul><ul><li>In the Chinese case, regional disparities are serious but inevitable. The Govt. has implemented several ‘ regional development policies’ eg. ‘ western development ’ to address the problem. Further development will certainly reduce disparities (..trickle-down process) </li></ul>Income inequalities to rural-urban disparities
  19. 19. China need to Fix many Growth Problem <ul><li>Not Just growth, but better growth and its sustainability. </li></ul>China’s environmental degradation from water to air pollution has become very serious. Most by–product not created ……so called ’negative externalities. China’s environmental problems are result of its: - mammoth scale of industrialisation at high speed - govt.’s pro-growth policy with weak regulation- ‘develop fist ,clean up later’
  20. 20. Environmental Issues and Energy use pattern in China Top Ten polluter countries in 2004 by CO2 emissions In 2006 1. China: 6017 million MT 2. US: 5902 million MT <ul><ul><li>China’s heavily reliance on coal has had extremely serious effect on the environment and health of population. Each year avg. some 6000miners are killed as result of mine explosion, flood, ill-maintained equipment. </li></ul></ul>By 2030 it could be reached 25% of global emission. 1.7 % 449,948   Italy 10 1.7 % 465,643   South Korea 9 2.2 % 587,261   United Kingdom 8 2.3 % 639,403   Canada 7 3.1 % 860,522   Germany 6 4.6 % 1,257,963   Japan 5 4.9 % 1,342,962   India 4 5.6 % 1,524,993   Russia 3 14.7 % 4,001,222   European Union - 18.4 % 5,010,170   China 2 22.2 % 6,049,435   United State 1 % of world’s total emission Annual CO2 emission (in thousand MT) Country Rank
  21. 21. 5. Conclusion <ul><ul><li>For the past 20 years china’s economy has been growing at an average over 9%. Rapid economic growth is expected to continue for many years yet. But the one possible constrain may be energy. In order to sustain such growth, sufficient energy must be available in required forms. </li></ul></ul><ul><ul><li>And another very important issues- it is difficult for an overheated economy growing at 10% to reduce pollution or reduce energy consumption. But long term challenge is there which need appropriate policy. </li></ul></ul>
  22. 22. References: <ul><li>Gungwu W. and Wong J.,2007, Interpreting China’s Development, World Scientific Publishing Co. Pte.Ltd. </li></ul><ul><li>China Statistical yearbook 2006, China Statistical Press. </li></ul><ul><li>World Energy Outlook 2007,IEA </li></ul>THANK YOU !