Preliminary SEA of the great western development strategy - The five key development domains

 68877 Preliminary SEA of the Great Western Development Strategy The Five Key Development Domains Summary Report January 2007 World Bank Environment and Social Development East Asia and Pacific Region  This publication was developed and produced by the Environment and Social Development Unit (EASES), of the East Asia and Pacific Region of the World Bank. The Environment, Rural and Social Development Units are part of the Environmentally and Socially Sustainable Development (ESSD) Network. Environmental and social development issues are integral part of the development challenge in the East Asia and Pacific (EAP) region. The recently completed Environment and Social Development Strategies for the World Bank in the region have provided the conceptual framework for setting priorities, strengthening the policy and institutional framework for sustainable development, and addressing key environmental and social development challenges through projects, programs, policy dialogue, and partnerships. This publication is part of a series that have been supported through the Trust Fund for Environmental and Socially Sustainable Development (TFESSD). Further information is on the TFESSD is available online at <www.worldbank.org/tfessd>> This publication is available online at <<www.worldbank.org/eapenvironment>>. Front cover photos: Bob Sacha Photography. Environment and Social Development Department East Asia and Pacific Region The World Bank Washington, D.C. January 2007 ____________________________________________________________________________________ This volume is a product of the staff of the International Bank for Reconstruction and Development / The World Bank. The findings, interpretations, and conclusions expressed in this paper do not necessarily reflect the views of the Executive Directors of The World Bank or the governments they represent. The World Bank does not guarantee the accuracy of the data included in this work. The boundaries, colors, denominations, and other information shown on any map in this work do not imply any judgment on the part of The World Bank concerning the legal status of any territory or the endorsement or acceptance of such boundaries. The material in this publication is copyrighted. Copying and/or transmitting portions or all of this work without permission may be a violation of applicable law. The International Bank for Reconstruction and Development / The World Bank encourages dissemination of its work and will normally grant permission to reproduce portions of the work promptly. For permission to photocopy or reprint any part of this work, please send a request with complete information to the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA 01923, USA, telephone 978-750-8400, fax 978-750-4470, www.copyright.com. All other queries on rights and licenses, including subsidiary rights, should be addressed to the Office of the Publisher, The World Bank, 1818 H Street NW, Washington, DC 20433, USA, fax 202-522-2422, e-mail pubrights@worldbank.org Table of Contents ________________________________________________________________________________________________ Foreword iv Acknowledgments v Acronyms vi Executive Summary vii Key Findings Summary Page x Chapter 1. Introduction 1 1.1 Objectives and anticipated results of SEA for GWDS 1 1.2 Western region 2 1.3 GWDS plans and projects 2 1.4 Approach of the SEA study 6 Chapter 2. SEA – Worldwide and China 9 2.1 International SEA context 9 2.2 Considerations for future systems in China 11 Chapter 3. Baseline description 13 3.1 Environmental regions 14 3.2 Land resources 15 3.3 Water resources 16 3.4 Forest resources 18 3.5 Energy and mineral resources 18 3.6 Biodiversity and ecosystem services 21 3.7 Tourism resources 23 Chapter 4. Main environmental challenges 25 4.1 Summary of environmental constraints 25 4.2 Description of the causes of identified environmental problems 31 4.3 Environmental problems at the province level 32 Chapter 5. Assessing the environmental impact of GWDS 36 5.1 Water resource development and utilization plans 36 5.2 Land utilization plans 37 5.3 Energy resource exploitation plans 40 5.4 Biodiversity protection plans 43 5.5 Tourism development plans 45 5.6 General observations about development in the western region 47 Chapter 6. Recommendations 48 6.1 Regional level recommendations 48 6.2 Provincial level recommendations 53 6.3 Lessons learned and next steps 65 References 66 i  CD-ROM User Guide Part 1 – Full SEA Study 1.1 Full SEA study (197 pages) [3.6MB] Part 2 – Further information on Western China and the GWDS 2.1 Protected areas in Western China (map) 2.2 Provincial level objectives for five plans of the GWDS [0.1MB] Part 3 – Further information on SEA 3.1 SEA experiences in China [0.1 MB] 3.2 International Experience on SEA and its application in China; Note for SEA practitioners in China - a review of the literature; Isao Endo. World Bank, 2004. [0.1MB] 3.3 SEA Outside the Bank. Rob Verheem. The Netherlands EIA Commission. [ppt, 0.13MB] 3.4 New Concepts in Strategic Environmental Assessment; Towards Better Decision-Making. ANSEA (2002). [pdf, 0.6MB] 3.5 SEA – Concept and Practice. World Bank Environment Strategy Notes, No 14 (2005). Kulsum Ahmed, Jean Roger Mercier, and Rob Verheem. [pdf, 0.1MB] 3.6 Integrated Environmental Considerations in Policy Formulation; Lessons from policy-based SEA experience (2005). World Bank Environment Department, report number 32783. Part 4 – Further information on World Bank support for SEA 4.1 Strategic Environmental Assessment Bank Program FY05. Kulsum Ahmed and Jean Roger Mercier. World Bank SEA Training Workshop, June 2004. [ppt, 0.2MB] 4.2 World Bank Structured Learning Program (SLP) [0.1MB] 4.3 World Bank Distance Learning Course [0.1 MB] 4.4 Strategic Environmental Assessment in World Bank Operations. Experience to date and future potential. World Bank Environmental Strategy Papers, No 4 (2002). Olav Kjörven and Henrik Lindhhem, ECON Centre for Economic Analysis, Oslo, Norway. [pdf, 0.8MB] ii List of Figures Figure 1.1 Provinces in the western region 2 Figure 3.1 Geographic Zones and Land Use types in Western China (2000) 14 Figure 3.2 Average annual temperature and annual precipitation 14 Figure 3.3 Land use patterns, Western China (2003) 15 Figure 3.4 Gross output value of land industries, Billion Yuan (2003) 16 Figure 3.5 Average Annual Precipitation (mm/year) 16 Figure 3.6 Distribution of Typical Ecosystems 23 Figure 3.7 Distribution of typical tourist resources in the western region 24 Figure 4.1 Soil and water loss in Arable land and Grassland 26 Figure 4.2 Desertification of i) Arable land and ii) Grassland 28 List of Tables Table 1 Overall Summary of GWDS consequences x Table 1.1 Structure of the study 1 Table 1.3 Environmental standard classification 7 Table 3.1 Baseline descriptive statistics for western region provinces 13 Table 3.2 Land use patterns (percent of land area) 15 Table 3.3 Exploitation and utilization of water resources (2003) 17 Table 3.4 Forest cover km2 (various years) 18 Table 3.5 Coal reserves in the western region (million tons) 19 Table 3.6 Oil and natural gas reserves in the western region 19 Table 3.7 Wind energy potential 20 Table 3.8 Recoverable deposits of main mineral resources 21 Table 3.9 Extent of nature reserves (1997, 2000, and 2003) 21 Table 3.10 Description of ecosystems types in the Western Region 22 Table 3.11 Tourism activity in western provinces 24 Table 4.1 Water Deficiency in Key areas of Northwestern China (m3) 25 Table 4.2 Overview of causes for land degradation in each sub-region 26 Table 4.3 Statistics on Soil Deterioration in Northwest China 27 Table 4.4 Percent Forest Coverage and Grassland Coverage (2000) 28 Table 4.5 Wastewater pollution and treatment levels (2003) 30 Table 4.6 Air Quality (2003 and 2004) 31 Table 4.7 Current environmental problems per province 33 Table 4.8 Status of environmental features at the province level 33 Table 5.1 Consequences of water resource plans in the GWDS 37 Table 5.2 Consequences of land utilization plans in the GWDS 39 Table 5.3 Consequences of energy exploitation plans in the GWDS 43 Table 5.4 Consequences of biodiversity plans in the GWDS 44 Table 5.5 Consequences of tourism plans in the GWDS 46 Table 6.1 Summary of overall impacts from GWDS in Chongqing 53 Table 6.2 Summary of overall impacts from GWDS in Sichuan 54 Table 6.3 Summary of overall impacts from GWDS in Guizhou 55 Table 6.4 Summary of overall impacts from GWDS in Yunnan 56 Table 6.5 Summary of overall impacts from GWDS in Guangxi 57 Table 6.6 Summary of overall impacts from GWDS in Qinghai 58 Table 6.7 Summary of overall impacts from GWDS in Tibet 59 Table 6.8 Summary of overall impacts from GWDS in Shaan’xi 60 Table 6.9 Summary of overall impacts from GWDS in Ganshu 61 Table 6.10 Summary of overall impacts from GWDS in Ningxia 62 Table 6.11 Summary of overall impacts from GWDS in Xinjiang 63 Table 6.12 Summary of overall impacts from GWDS in Ningxia 64 iii Acknowledgments ________________________________________________________________________________________________ This publication was developed through collaboration between the Beijing Normal University in China and the World Bank. The Beijing Normal University team was lead by Dr Li Wei, and the main members include Dr. Zhang Yan, Dr. Zhao Yanwei, Dr. Zhao Wei and Dr. Shen Yiqing. The team also received executive guidance and instructions from officials of Foreign Economic Co-operation Office (FECO), State Environmental Protection Administration (SEPA), Mr. Wen Wurui and Mr. Wang Xin. International experts Arend Kolhoff, Rob Verheem, from the Netherlands Commission for Environmental Impact Assessments and Haakon Vennemo from ECON, Norway, provided technical guidance throughout the process, commented on a first draft document and provided suggestions for improvements. Further comments and guidance were received from Mr Wo Bo at the State Environmental Protection Administration (SEPA) for China. The Task Team Leader for this work was Jostein Nygard, Senior Environment Specialist, and guidance for the project was given by Madga Lovei, Sector Manager, Environment and Social Development Unit of the East Asia and Pacific Region (EASES) of the World Bank. Technical assistance and project support was provided by Andrew Murray (Junior Professional Associate). Funding for this work was generously provided by the Norwegian and Finnish governments through the Trust Fund for Environmentally and Socially Sustainable Development (TFESSD). iv Acronyms ________________________________________________________________________________________________ ADB Asian Development Bank API Air Pollution Index BOT Build Operate Transfer CCHP Combined Cooling, Heat and Power CDC Critical Decision Component CHP Combined Heat and Power CIDA Canadian International Development Agency COD Chemical Oxygen Demand EA Environmental Assessment EASEN East Asia and Pacific Environment Unit EIA Environmental Impact Assessment EPB Environment Protection Bureau EU European Union FDI Foreign Direct Investment FYP Five Year Plan GDP Gross Domestic Product GIOV Gross Industrial Output Value GRP Gross Regional Product GWDS Great Western Development Strategy IEM Integrated Environmental Management KDD Key Development Domain M Million NBS National Bureau of Statistics NDRC National Development and Reform Commission NEPA National Environment Policy Act NPC National Peoples Congress NTA National Tourism Administration PEIA Province Environmental Impact Assessment PEIS Programmatic Environmental Impact Statements PPP Policy, Plan, Program REIA Regional Environmental Impact Assessment RMA Resource Management Act SA South Africa SEPA State Environmental Protection Administration SEA Strategic Environmental Assessment UNESCO United Nations Educational, Scientific, and Cultural Organization USEPA United States Environmental Protection Agency WDO Western Development Office WRM Water Resource Management v Executive Summary ________________________________________________________________________________________________ Background and context Since the 1970s China has achieved impressive levels of economic growth and widespread poverty reduction. These gains have been built on the back of a supportive policy framework that encouraged a ‘grow at all costs’ development path, but, with environmental pressures becoming more critical, the objectives of China’s government are changing. Recent statements of the Chinese State Council indicate that while economic development remains crucial, a more balanced and sustainable approach is now being emphasized. The Chinese government has also been concerned about the pattern of growth that has occurred, which has been much more pronounced in the eastern part of the country. For example, per capita GDP in the western region is only 50 - 75 percent of the national average. While it is geographically massive (roughly 70 percent of the country), the western region only accounts for 28 percent of the population and 19 percent of GDP. In spite of the relatively sparse population it still faces a range of serious environmental threats, from water scarcity in the north to heavy pollution loads in the south. The Great Western Development Strategy (GWDS) represents a huge commitment to progress in the western region and is being undertaken in order to help close the economic gap between the west and more developed eastern provinces. Government statements refer to the establishment of a ‘new western China’ over the coming decades, and to development for minority ethnicities who will be better integrated with the rest of China. In order to achieve these goals the GWDS has objectives for infrastructure development, environment, local industry, investment environment, and science, technology and education. Study development and objectives Following the enactment of China’s new EIA law (2003), which requires SEAs to be undertaken for certain plans, the State Environmental Protection Administration (SEPA) requested World Bank to support SEA training for EIA professionals. At the same time SEPA requested World Bank support for a preliminary SEA to be carried out to provide practical experience of SEA and guidance for GWDS planning. The study objectives are to provide a general baseline description of the environment in western China, analysis of the environmental impacts of GWDS plans, and to provide suggestions for mitigating measures or alternatives to facilitate the GWDS decision making process. This study represents a trial-SEA in China and provides an opportunity to develop experience and capacity at the strategic level of assessment, to date this level of analysis (strategic planning) has been especially rare in China. The vast scale, scope and duration of the GWDS make it a challenging subject for a preliminary SEA. Other challenges for this undertaking included the lack of inter-agency cooperation and collaboration, which is especially important for a project such as the GWDS that involves many government agencies at multiple levels. Further, until recently the process of environmental assessment has been undermined by very weak enforcement of relevant EIA laws, but as more experience and awareness is generated the process is becoming more robust. Indeed the change in emphasis from the Chinese government, from ‘growth at all costs’ to ‘balanced and sustainable growth’, will lead to increasing levels of political support for more dedicated and more rigorously enforced environmental assessments in the future. The SEA approach ensures that plans, processes and policies account for local conditions and impacts on all stakeholders. Baseline Description and Main Environmental Challenges In order to facilitate analysis of this vast area (6.8 M km 2) the western region was split into 3 areas, southwest (mountainous sub-tropical), northwest (arid grass plains), and Tibet-Qinghai (high altitude plateau). Chapter 3 provides a comprehensive analysis of the basic conditions in each of these areas with respect to various physical features, e.g. water and energy resources, ecological endowment etc. Western China is vulnerable to a number of inter-related environmental threats, these issues are discussed in relation to planned GWDS activities in Chapter 4. These threats include water scarcity, which is a serious and growing problem in northern areas where severe water deficiencies and ever growing demand are leading to over-exploitation of groundwater and drying up of lakes. Land degradation is closely linked to water regimes, vi in the north the arid landscape is threatened by desertification through wind erosion while in the south water erosion removes valuable topsoil from exposed land. In the Qinghai-Tibet plateau erosion is caused through freeze-thaw action and overgrazing. Inappropriate forms of land use speed up desertification in many areas. Forest cover in the northwest and plateau areas is naturally low, but in the southwest human activity has led to significant reductions in the quality of forests in terms of biodiversity and ecosystem services (in spite of wide- spread re-forestation activities). There are also environmental concerns for water and air pollution around urban centers, e.g. in many cities sewage treatment is low and urban rivers are reduced to sewage ditches. Industries in the region are pollution intensive and cause serious water, solid waste, and air pollution. The latter is particularly severe in industrial cities such as Urumchi and Lanzhou, causing serious respiratory health consequences. A related concern is the high sulfur coal used to generate energy in the region and the problems with acid rain that affect forest and agriculture. Potential Impacts from the GWDS The lack of a systematic monitoring or uniform planning across provinces makes it very difficult to draw detailed conclusions about current and future impacts from the GWDS. There are clearly many benefits being generated from the program, with wealth and development growing rapidly in many cities. Also on the environmental front the GWDS has led to widespread re-forestation (though forest quality is a problem), measures to improve irrigation efficiency and to preserve water, and protection on sloping lands to reduce soil erosion. These encouraging developments reflect the Chinese governments heightened sense of environmental responsibility, but the development plans also pose a number of environmental challenges. The analysis points to a number of weaknesses in the development of the western provinces that threaten environmental sustainability in the region, these include:  Industry is often highly inefficient and reliant on out-dated techniques, leading to resource waste and over use.  In many provinces authorities still have the ‘pollute now – clean up later’ approach, and development is being led by importing dirty industries from the East. Investors capitalize on flaws in environmental policy or weaknesses in enforcement to undertake polluting activities and resource extraction.  The transformation from environmentally damaging economic development (e.g. polluting industries, tree cutting, and mining) that are discouraged in the GWDS to more sustainable activities has not been smooth. Economic under-performance of new industries has led some local authorities to turn a blind eye towards polluting industries and deforestation.  Land allocation for forestation has been poor, often leading to failed projects and wasted financial resources, because forestation policies have not been flexible enough to respond to local environmental conditions and account for land suitability. The approach of this study is to explore impacts (direct and indirect, see section 1.4 on approach) from the strategy’s five Key Development Domains (KDD). The KDDs are water resource use, land use, energy exploitation, biodiversity protection, and tourism development. Planned activities in the KDDs are likely to place more pressure on the region’s water resources. High water exploitation levels in the northwest mean that increases in water demand could have dramatic consequences, and increasing wastewater emissions are a serious threat in the area. Strategy plans for agricultural expansion and urbanization will lead to increased water demand in many areas that already suffer water scarcity, and there are concerns about the impact of construction activities on river networks (e.g. hydro) and land quality (e.g. open cast mines). While tree cover has been increasing there are significant questions about the quality of forests that are being established, with poor age and species compositions that limit the ecological services they provide. Threats to biodiversity include planned hydro dams that will impede water courses, cause vegetation loss through water and soil degradation, and the impact of infrastructure development for mineral extraction and tourism activities. The most significant problems for air pollution are associated with plans to expand coal and oil extraction industries and the need for appropriate technologies to make this process as clean as possible. Findings and predictions for the consequences of the GWDS, for each KDD, are summarized at the province level for each implementation plan in tables 5.1 to 5.5. The results show some encouraging signs with many environmental features likely to improve. For example, in many places the study found that the GWDS will deliver environmental improvements on themes where there are currently significant environmental problems, e.g. forest deterioration and waste water treatment. However, numerous areas for concern emerged, especially with respect to land quality throughout the region, and water issues in northern provinces. In some cases vii proposed activities will place increased pressure on already stressed systems, Gansu and Inner Mongolia emerged as areas of particular concern. These findings are summarized for the GWDS as a whole in the key findings summary (page 1). Recommendations In order for the SEA approach to have an impact on the GWDS, the assessment system needs to be a dynamic and ongoing process (with regular monitoring and fine-tuning) in which the publication of this report represents only the first step. The SEA of GWDS has follow-up work plans to monitor and evaluate the impacts and recommend adjustments as necessary. Monitoring indices are selected based on four categories: water, soil, air, and biology and three agencies are specified as responsible. To be completed once recommendations are clear…. viii Key Findings Summary Page ________________________________________________________________________________________________ The assessment of recent and (potential) future environmental effects of the main GWDS PPPs are summarized in Table 1. It is important to note that since the GWDS is constantly evolving (future plans are not yet known) and is being implemented differently across provinces, the actual level of impact is not clear. In particular, the extent of environmental protection and / or impact mitigation measures uncertain, though many such activities are listed in PPPs. The summary table (below) represents an absolute baseline analysis, assuming no environmental protection measures are taken to mitigate impacts, i.e. it is a projection based only on measures and policies that are currently known. The symbols indicate current status and potential positive and negative consequences related to the GWDS. For example, downward arrows indicate areas where the PPPs may not be entirely on the right track in an environmental sense. Present situation (now): Values refer to 2002 (baseline year), and are presented for eight environmental factors. The most worrying are forest deterioration and soil erosion, while the best are soil salinization and air pollution. Future situation (future): Values refer to 2010 and are based upon the trend of impacts that have occurred from PPPs during the period 2002 to 2005. Impacts over the period 2002 – 2005 are used to make projections for the next 5 years (up to 2010) Therefore, it should be noted that implementation of new mitigation measures will lead to different results from those indicated below. Table 1. Summary of potential environmental impacts from GWDS framework PPPs (2000 - 2004)* Water & Biodiversity Water Soil Forest Soil erosion Desertification waste Air pollution & ecosystem availability salinization deterioration pollution services loss Now Future Now Future Now Future Now Future Now Future Now Future Now Future Now Future South west I  III  I  I  III  III  II  III  Chongqing II  III  I  I  III  III  III  II  Sichuan I  III  I  I  III  II  II  III  Yunnan I  III  I  I  III  III  II  III  Guizhou I  III  I  I  III  III  III  II  Guangxi II  I  I  I  III  II  II  III  North west III  III  III  III  III  II  II  II  Shaanxi II  III  III  III  III  II  II  II  Gansu III  III  III  III  III  II  III  II  Ningxia III  III  III  III  III  III  III  III  Xinjiang III  I  III  III  III  I  I  II  Inner. Mongolia. III  III  III  III  III  II  I  III  Qing-Zang Plateau I  II  II  III  II  I  I  I  Tibet I  III  I  III  II  I  I  I  Qinghai I  I  III  III  II  I  I  II  Now (present environmental situation) I: no environmental problems, there is potential for future use and development II: moderate environmental problems, change of environmental pressure to be considered, limited development possible III: significant environmental problems, immediate change of environmental pressure required Future (expected situation given plan implementation, by 2010) Three broad scenarios:  environmental deterioration;  environmental improvement;  stable environmental status. *More detailed tables relating to each Key Development Domain are given in chapter 5. ix Chapter 1 Introduction ___________________________________________________________________________________________________ 1.1 Objectives and Anticipated Results of SEA for GWDS 1.1.1 Study objectives and anticipated results The study objectives are to provide a thorough scientific analysis of the baseline status of and likely environmental impacts of the Great Western Development Strategy (more specifically the Key Development Domains). The study is designed to support the multi-level decision making and strategic priority setting process by providing expert guidance and suggestions to consider for the next stage of GWDS implementation. The former is achieved by analyzing the impact of the five Key Development Domains (KDD) of the GWDS (outlined below). As well as the assessment of likely environmental impacts from GWDS implementation, the paper provides a background description of SEA, internationally and in China. At a later stage in the implementation of the study, these objectives were refined to include more detailed province level information and a selection of critical issues that have emerged as key recommendations for each province. While this assessment was prepared after the initial launch of the GWDS, it is hoped that the extremely long- term perspective of the GWDS will mean that appropriate design modifications can be incorporated as new findings and guidance are developed. It is also hoped that this initiative will provide a template and a baseline against which future assessments in Western China can be implemented. However, this preliminary assessment does not incorporate any monitoring of GWDS activities to date, nor does it include a clear plan for monitoring in the future – this important task is highlighted in the recommendations as a next step task that should be built into the wider strategy. Other limitations of the current work, with respect to the scope of a full SEA, include the lack of public consultation, consideration of social implications, and analysis of alternatives. In defense of the study, the vase scale of this strategy (more than twice the area of India) has made a fully comprehensive SEA prohibitively difficult. Time and budget limitations have constrained the extent of possible work and this study has been customized accordingly. 1.1.2 Structure of the study The general structure of the work undertaken during the process of this assessment is outlined in table 1.1, which shows that the initial analysis of the GWDS was reduced to an assessment of key areas. Table 1.1 Structure of the study Strategic Analysis of Natural environment + SEA for Key Areas Conclusion / Suggestions GWDS resource features Background of GWDS Environmental analysis SEA pattern for Suggestions for - Survey of society and - Quality of natural GWDS development of SEA economy environment and - Launch, management, practice in China problems technical procedures Organizational Suggestions for eco- framework of western Ecological Zoning Retrospective assessment environmental protection region development - Southwestern zone, - Implementation effect, related to GWDS plans - Organizations, their northwestern zone, Tibet infrastructure and eco- duties and decision- zone environment construction Guidance targeted making procedure towards developments in Resource feature SEA for Key Areas the 11th five-year plan Decision-making levels Analysis - Water resources, land, of GWDS - Water, land, biological, energy exploitation, - Policies, plans, key energy, and tourism biodiversity protection, projects resources tourism development 1 1.2 Western region The geographical scope of the Great Western Development Strategy (Xibu Da Kaifa) includes the Figure 1.1 Provinces in the western region six provinces of Sichuan, Guizhou, Yunnan, Shaanxi, Gansu and Qinghai, as well as the five autonomous regions of Inner Mongolia, Guangxi, Tibet, Ningxia and Xinjiang, and the municipality of Chongqing. Collectively these areas are referred to as the western provinces, and they are shown in figure 1.1. The western region, which covers 6.8 million km2, (71.4 percent of the country) and represents 50 out of the country’s 55 different minority populations. The population of the western provinces accounts for 28.8 percent of the total population in China, but only 16.8 percent of its economic output (2003). Per capita GDP is only 68 percent of the national average. The low per capita GDP is partly explained by the fact that the western provinces have fewer urban residents than the rest of the country (29 versus 36 percent). Comparison of urban residents in the western provinces and elsewhere in China shows that the per capita income of the former is only 85 percent of the average for urban residents (NBS, 2004). Similar figures for rural residents are not available, but it is informative that in 2003 rural ownership of washing machines, refrigerators, bicycles and color TV sets was only 68, 42, 63, and 82 percent of the national total average in 2003 (China Statistical Yearbook 2004). As another indication, GDP per capita in Shanghai (the richest province) is 13 times that of Guizhou (the poorest province) and life expectancy is 12 years higher in the former than the later (NBS, 2004). 1.3 GWDS plans and projects 1.3.1 General background to GWDS The State Council Western Development Office (WDO) promulgated the ‘General Planning for Western Development’ in 1999 with the overall objective to help close the economic gap between the western region and the rest of the country. The strategy, which represents a great commitment from the central government to speed up western development, was designed to boost socio-economic development, to improve living conditions for China’s minorities, and support environmental improvement. The major objectives of the plan, which were laid out by premier Zhu Rongji (March 2000 session of NPC), include:  Infrastructure Development: The GWDS includes extensive infrastructure plans including construction of highway networks, rail-track, airports, and gas pipelines. Investments will include expansion of electric power grids, telecommunications, radio and television facilities, as well as infrastructure in large and medium-sized cities. Importantly for this SEA the GWDS also calls for rational exploitation of water resources and water conservation.  Environment: The GWDS encourages projects to protect natural forests along the upper reaches of the Yangtze River and the upper and middle reaches of the Huang (Yellow) River. Terraced fields on steep slopes (25 percent) should be returned to forests or pastures. Initiatives in support of water resource management will include establishment of more efficient water usage and irrigation systems, implementation of cross-water supply projects, and improvements to ecosystem and water quality.  Local Industry: The GWDS encourages different regions to develop industries that maximize local comparative advantages in geography, climate, resources and other conditions. Where possible, these regions are also urged to capitalize on high/new technology industries.  Science, Technology, and Education: The GWDS promotes the development of different levels of expertise and an overall improvement of quality in the workforce across regions. It also recommends that the regions accelerate product development through better use of scientific research. 2   Investment Environment: Western provinces should take steps to attract more foreign investment, capital, technology and managerial expertise. The eastern and coastal provinces are also asked to play a role in providing these items.  Additional: In addition, some GWDS materials include ‘improvement of public services’, ‘increase in number of urban residents’ and ‘closing the gap in the material livings standards of households’ among the objectives. In order to achieve these objectives the WDO issued seven macro-development plans, that fit into the general GWDS framework, to support implementation during the 10th FYP period. These plans are; Land resource development and utilization planning; Water resource development planning; Education enterprise development planning; Science and technology development planning; Agricultural development planning; Highway development planning; Railway development planning. All of these plans have environmental implications, but three in particular have explicit environmental objectives or major sub-objectives:  Water resource plans suggest that water conservation projects in should improve living standards and protect / improve the natural environment, including extensive irrigation works.  Science plan includes objectives for ecological development and provides support for ecological and infrastructure construction.  Agriculture plan includes an objective to recover and develop grassland in the western region. However, most of these plans are not highly specific and only provide basic guidelines that have to be interpreted and developed into detailed action plans by the western provinces, along with relevant ministries and agencies. The WDO also proposed five Key Development Domains (KDD) as part of the GWDS that have more detail and structure. These plans (outlined in section 1.3.3) form the basis of this study, and are i) water resource planning, ii) land use planning, iii) energy development planning, iv) eco-environmental construction (biodiversity conservation) planning, v) tourism development planning. 1.3.2 Policy level support for the GWDS In order to support the GWDS the government has implemented a number of policies to facilitate growth and investment (a number of which have a 10 year life span), and has committed large volumes of public money to investment in the western region. The planned increases in investments will lead to a shift in the focus of China’s government expenditure from coastal provinces towards the western region. The government has planned for increases in the percent of central construction and subsidy funds spent in the western region, and has directed banks to increase lending to the western region, in particular to railways, main express-ways, electricity, petroleum and natural gas projects. The government has also been initiating policies that are designed to increase private sector investment. It has reduced business taxes and, in the case of environmental protection, allocation of ownership rights to those converting land to forestry and grassland. Other policy developments include encouragement for the development of mining operations and less regulation of prices. Furthermore, policies have been implemented to encourage foreign investment and the eastern region will increase its level of assistance to western provinces. Finally, western provinces will receive higher priority in appropriation of funds for scientific and technological projects, and there will be more support for public health and family planning. 1.3.3 Key Development Domains of the GWDS A description of the content and objectives of the five Key Development Domains (KDDs) of the GWDS is provided below. A more detailed analysis of the provincial level recommendations is provided in the CD-ROM attachment. Theme 1: Water resource development and utilization plans: This plan is intended to promote rational use and development of water resources in order to improve living conditions and productivity in the western region. Objectives include optimizing allocation between users, increasing overall efficiency of water use, developing water resources (including water transfer projects), establishment of infrastructure for water collection and conservation, and rationalization of water use (to be sustainable). The latter will include industrial restructuring with water intensive projects and companies being phased out. In the water scarce northwest region the focus is on water saving principles in industry, civil society, and especially agriculture, e.g. support for water saving irrigation and associated infrastructure. Furthermore, 3 the plan is intended to strengthen the unified management of river basin resources, implement flood control measures, and strengthen reservoirs. Water resources in the upper reaches of the (Huang) Yellow and Yangtze River drainage areas will receive intensified protection, and increased treatment levels are planned for the Black and Tarim rivers. The strategy will also introduce market reforms, appropriate pricing mechanisms, and implementation of diversified benefit compensation mechanisms. Theme 2: Land-use plans: Land use plans have the following objectives; i) to make available required construction land for infrastructure developments (though agricultural / cultivated land will receive protection), ii) to return large areas of cultivated land to forest and grassland, iii) to protect and ensure the sustainability of cultivated land. In order to allow space for cultivation on high-quality farmland in the western region. The establishment of forests, fruit plantations, and animal husbandry zones will be prioritized in desert, mountain, and wasteland areas in the western region. Theme 3: Energy sector plans: The western region has a wide range of energy resources, coal and gas are the most important forms in the northwest, and in the southwest there is significant potential for hydro and pithead power stations. Energy sector plans are designed to take advantage of the regions energy reserves and to develop the west as an energy base for the rest of the country through west-east power transmission projects. The GWDS energy sector plans are intended to strengthen oil and gas exploration capacity as part of China’s wider energy strategy. Other objectives include improving industry structure (e.g. west-east power transmission, gas transportation), and address energy efficiency of modern technologies for maximizing energy capture and efficiency. Power distribution will be addressed at the local level, urban and rural power grids will be upgraded. At the national level, the structure of power grids will be improved with the construction of three West – East high-voltage grids (north, middle and south) to transport energy to target areas in the east. Coal: The coal sector will be restructured with an emphasis on exploitation of high-quality reserves. Ongoing construction projects will be fast-tracked for completion, especially the development of high-quality steam coal mines, plans for technological innovation and improvements to old mines will be developed, and coal transportation systems will be improved. Efforts to improve coal quality will include the development of ‘clean- coal’ technologies, such as coal washing and separation plants, and coal liquefaction model projects, and options for exploitation and use of coal-bed methane resources will be explored. Oil and Gas: Exploration / exploitation activities will be fast tracked along with increased support for oil and gas transport infrastructure (e.g. production bases and pipelines). Transportation sites will be developed in the Tarim, Chaidamu, Shaanxi-Gansu-Ningxia, and Sichuan-Chongqing regions, and a network of pipelines will connect i) Tarim to the Yangtze River Delta, ii) Chaidamu (via Xining) to Lanzhou, iii) Zhong (Chongqing) to Wuhan City (Hubei), and iv) Jingbian County to Huhe Haote City. Other power: The strategy also includes activities to increase hydropower (e.g. Longtan, Gongbo Gorge, Xiaowan, Goupitan and Pubugou), thermal power (increase large-scale, decrease small-scale), and moderately develop nuclear power capacity. Large-sized pithead power stations will be established in Shaanxi, Inner Mongolia, Ningxia, Guizhou and Yunnan. Theme 4: Biodiversity protection plans: The western region is home to an important array of biological diversity, for example assessments indicate that the region has eight key biodiversity hot spots where protection has global significance (there are 17 in all of China). The high mountains and steep gorges in the southwest, once the refuge of animals during the Quaternary period ice age, are rich with alpine flora and have abundant varieties of primitive animals and plants. The strategy includes extensive plans for re-establishing large areas of forest and grassland vegetation. It will provide support for the recovery of damaged, and protection for existing, natural woodland and grassland ecosystems. Furthermore, the strategy includes the provision of more effective protection for rare and endangered animals and plant species, e.g. increases in the extent of nature reserves will be implemented in areas with biodiversity in ecologically fragile environments. A series of nature reserves covering an area of 4 around 6 million hectares will be established, and within five years the region will have over 200 reserves, including 40 key national level reserves covering that 45 million hectares. Activities will include;  Qinghai-Tibet Plateau: Preservation of endangered species such as Chiru (Tibetan Antelope), Przewalski’s gazelles, Alpine Musk deer and Snow Leopard.  Yangtze and (Huang) Yellow River source and plateau lakes: Wetland protection and establishment of ‘arid plateau’ and ‘semiarid desert’ ecosystem conservation zones.  Inner Mongolia and Xinjiang (plateaus and deserts): Ecosystem conservation zones will be initiated along with protection for wildlife such as ungulates (hoofed mammals).  Mountainous southwest: Habitats for key endemic species, such as pheasant and wild spotted deer, will be restored along with the establishment of new nature reserves.  Himalayas: Activities will be undertaken to protect the Himalayan musk deer and the white-lipped deer. Forest management will be strengthened and forest and grassland vegetation restored with large-scale protection and planting schemes a focus will be re-forestation of mountains and fields (hillside closures and seed sowing by airplane will be used). Afforestation will be implemented through ‘grain for green’ projects, where farmers are compensated for returning farmland to forest and grassland. Natural forests and grasslands will receive extra protection and destruction or unregulated exploitation will be banned. Threats to grassland habitats, such as cattle grazing will be managed (e.g. by promoting rotation grazing), and grassland for agriculture will be controlled with some pastures will be enclosed for vegetation protection. Theme 5: Tourism development plans: The potential for a strong and vibrant tourist industry in China has been recognized for some time. The region spans a huge landmass with dramatic landscapes, abundant rivers, lakes, mountains, biodiversity, and many marvelous natural sights. Furthermore, the region has a rich cultural heritage with many important sites and over 50 different ethnic groups offering a wide range of customs and traditions. The objectives of tourism development plans are to fully utilize the abundant natural and cultural attractions in western China. The tourist industry will be established as a key development objective, and should become a pillar industry in the region. Appropriate infrastructure will be developed, focusing on transport infrastructure, use of scenic spots, and the protection of key locations. The Western Tourist Investment Plans, compiled by the National Tourism Administration (NTA), State Planning Commission and the Western Development Office (WDO), set out the main tourist attractions to be developed:  Northwest: Cross-regional parts of the “Silk Road