Green Transformation in China: Progress and Outlook
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handled severely, and a large number of outstanding environmental problems have
been resolved. To sum up, the system reform aimed at promoting green development
has provided effective institutional support for green transformation.
2 Advantages and Challenges for Promoting Green
Transformation
Green development is a long-term, complicated, and uphill task that involves
economic, industrial, and technological progress and institutional changes. China has
institutional advantages, the latecomer advantage, and the advantage as an enormous
economy in promoting green transformation, with large space for green technological transformation of traditional industries. However, various constraints such as
“squeezed growth” in industrialization, deficient resource endowments and energy
mix, and peaking major pollutant emissions will pose great challenges to China’s
green transformation.
1. Advantages
The first is China’s institutional advantages as a socialist country. Green transformation requires the market to play a pivotal role, of which the premise is that the
government effectively fulfills its public functions. China has incorporated ecological progress into its Five-Sphere Integrated Plan, established the new concept of
green development, and advanced the construction of a resource-conserving and
environmentally friendly green development system. These efforts, together with
the government’ effective decision-making system and strong execution and societywide consensus on green development, give China unique institutional advantages
in promoting green transformation.
The second is the latecomer’s advantage in green development. China’s industrialization and urbanization started relatively late and are still at a low level. The new
demand for industrial capacity and urban infrastructure can be satisfied by developing
green capacity and green infrastructure, thus avoiding the lock-in effect of industrialization and urbanization and bringing enormous green benefits. For example, China
is undergoing a sustained urbanization process. In 2018, the urbanization rate was
close to 60% and is expected to exceed 70% in the future, meaning that 150 million
rural people will flow to cities. This will lend momentum to economic growth and
generate great green benefits from the circumvention of the lock-in effect.
The third is the advantage as a major economy. In 2018, China’s GDP reached USD
13.6 trillion, accounting for 66% of that of the U.S. and remaining the second largest
in the world. The tremendous economic size provides a solid basis for developing
green technology and shaping complete industry chains, since the initial costs of
green technology R&D can be shared and start-ups can be incubated within the
domestic market. What’s more, China has an enormous, full-fledged manufacturing
system where some industries and technologies are leading the world and other are
275
handled severely, and a large number of outstanding environmental problems have
been resolved. To sum up, the system reform aimed at promoting green development
has provided effective institutional support for green transformation.
2 Advantages and Challenges for Promoting Green
Transformation
Green development is a long-term, complicated, and uphill task that involves
economic, industrial, and technological progress and institutional changes. China has
institutional advantages, the latecomer advantage, and the advantage as an enormous
economy in promoting green transformation, with large space for green technological transformation of traditional industries. However, various constraints such as
“squeezed growth” in industrialization, deficient resource endowments and energy
mix, and peaking major pollutant emissions will pose great challenges to China’s
green transformation.
1. Advantages
The first is China’s institutional advantages as a socialist country. Green transformation requires the market to play a pivotal role, of which the premise is that the
government effectively fulfills its public functions. China has incorporated ecological progress into its Five-Sphere Integrated Plan, established the new concept of
green development, and advanced the construction of a resource-conserving and
environmentally friendly green development system. These efforts, together with
the government’ effective decision-making system and strong execution and societywide consensus on green development, give China unique institutional advantages
in promoting green transformation.
The second is the latecomer’s advantage in green development. China’s industrialization and urbanization started relatively late and are still at a low level. The new
demand for industrial capacity and urban infrastructure can be satisfied by developing
green capacity and green infrastructure, thus avoiding the lock-in effect of industrialization and urbanization and bringing enormous green benefits. For example, China
is undergoing a sustained urbanization process. In 2018, the urbanization rate was
close to 60% and is expected to exceed 70% in the future, meaning that 150 million
rural people will flow to cities. This will lend momentum to economic growth and
generate great green benefits from the circumvention of the lock-in effect.
The third is the advantage as a major economy. In 2018, China’s GDP reached USD
13.6 trillion, accounting for 66% of that of the U.S. and remaining the second largest
in the world. The tremendous economic size provides a solid basis for developing
green technology and shaping complete industry chains, since the initial costs of
green technology R&D can be shared and start-ups can be incubated within the
domestic market. What’s more, China has an enormous, full-fledged manufacturing
system where some industries and technologies are leading the world and other are