China Policy Institute: Analysis


Sustainable Development

Where is China’s Textile and Apparel Industry Going?

Written by Sheng Lu and Marsha A. Dickson.

China is well known as the largest textile and apparel (T&A) producer and exporter in the world, yet China’s T&A industry is also under-going tremendous restructuring and transformation. This article intends to shed light on the broad landscape of China’s T&A industry in the years ahead. Capturing where China’s T&A industry is going from the macro perspective is critical for shaping meaningful future research agendas and identifying new research opportunities associated with the sector.

Common misunderstandings about China’s T&A industry

More or less, China’s T&A industry is commonly misunderstood in the following aspects: 

Misunderstanding 1: China’s T&A industry is export-oriented. On the contrary, the export dependency ratio of China’s T&A industry, i.e. the percentage of exports within the value of total industry output, has significantly declined from over 30% in 2000 to less than 17% in 2011 (CTEI, 2012). This means that over 80% of T&A “Made in China” today actually are consumed domestically. As China’s apparel retail market starts to boom, expanding domestic sales will become an even more important priority for China’s T&A industry in the future. Not only are domestic sales growing, the International Labour Organisation cites statistics from UNIDO that suggest the increased domestic demand is contributing to growing value added by the industry in China, which will likely bring increased interest in production for local markets versus export.

Misunderstanding 2: China dominates the world T&A market. Although China is still the world’s single largest T&A exporter, it should be noted that China’s market share in some leading T&A markets is gradually declining. For example, Chinese products accounted for a 39.7% share of the EU T&A import market in 2013, down from shares of 41.4% in 2012, 43.9% in 2011 and 45.5% in 2010. Chinese products are also losing momentum in the U.S. T&A import market where Chinese market share dropped from 41.2% in 2011 to 38.9% in 2014. The grave concerns about China’s dominance in the world T&A market when the quota system was eliminated in 2005, are now proven to be unnecessary.

Misunderstanding 3: ‘Made in China’ is losing price competitiveness. It is a common argument that China’s fast rising labour cost is mainly responsible for its loss of shares in the world T&A export market. However, trade statistics suggest otherwise. For example, from 2006 to 2014, the average unit price of U.S. T&A imports from China only slightly increased from $1.45/square-meter-equivalent (SME) to $1.46/SME (up 0.7%), whereas the average unit price of T&A imports from the rest of the world increased from $1.97/SME to $2.13/SME (up 7.9%). In fact, total landed cost of T&A ‘Made in China’ remains one of the lowest in the world, thanks to China’s more efficient supply chain management, more modern infrastructure, and workers’ higher productivity than key competitors such as Vietnam and Bangladesh (OTEXA, 2015). Nonetheless, Chinese factories still face challenges in complying with the country’s labour laws regarding payment of social insurance benefits. Full compliance may increase costs but should help address growing labour activism in a country where workers are increasingly resorting to strikes and work stoppages in order to obtain these benefits, and other improvements in working conditions.

Misunderstanding 4: T&A is a pillar industry in China. Three decades after its economic opening-up and growth, China has passed the development stage which heavily relies on the T&A sector for creating jobs and generating foreign reserves. Instead, with a more diversified industry base, especially the emergence of other more advanced and capital and technology intensive sectors, T&A industry is playing a much less critical role in China’s economy today. By 2012, the T&A industry had only accounted for 3% of employment and 3.5% of industry output in China. Moreover, it won’t be too long before the total size of China’s T&A industry starts to shrink. As a matter of fact, more and more low-end and resource-intensive segments of the T&A industry, such as apparel assembly, are leaving the country and moving to other less-developed Asian economies.

Future of China’s T&A industry: policymakers’ vision

In addition to the market forces, another important factor that will shape the future of China’s T&A industry is government policy. Different from many western countries, government in China has preserved a significant role for the state in the economy.

According to the 12th Five-Year Plan, a key document which lays out policymakers’ blueprint for the development of China’s T&A industry from 2011 to 2015 (CTEI, 2011), critical changes are happening in the following four areas:

  1. Industry upgrading. Two aspects are particularly emphasised: one is the structure of industry output – China intends to gradually move towards more production of textiles and less of apparel. For example, by the end of 2015, apparel is expected to account for 48% of total T&A industry output, down from 51% in 2011, whereas the share of technical textiles is expected to increase from 20% to 25%. Another aspect is moving up in the value chain – China is eager to engage in more high-value added functions such as design, product development and distribution. The government is pledging financial support for the building of indigenous Chinese fashion brands and further sets the goal to have indigenous-branded products account for no less than 50% of China’s total T&A exports by the end of 2015.
  2. Building a “greener industry”. Recognising the rising awareness of environmental protection in the country, China ambitiously sets the compulsory goal to reduce the consumption of energy, water and emission of pollutants per GDP output in the T&A industry respectively by 20%, 30% and 10% annually (or cut by 67.2%, 83.2% and 41% cumulatively from 2011 to 2015). China also plans to double the consumption of recycled textiles from 2011 to 2015 (or nearly a 15% annual growth), hoping to reduce demand for natural resources in the process of making T&A. Already we see examples of leading Chinese manufacturers such as the Esquel Group, TAL, and the Crystal Group emerging as leaders in improving environmental performance within their factories and also taking active roles in global industry initiatives focused on sustainability.
  3. Moving production from the east coast to the west. To keep as many jobs in China as possible, the Chinese government encourages T&A manufacturers in the east coast to move factories to the inner part of China where the local economy is still at the nascent stage of industrialisation and cheap labour is still relatively abundant. By the end of 2015, the Western region is expected to account for 28% of China’s total T&A output, a significant increase from 17% in 2010. However, some Chinese manufacturers are taking an alternative route of investing in production in low cost countries in Africa and Southeast Asia, suggesting that Chinese PEOPLE, if not China the COUNTRY, will retain some level of prominence in global T&A production for the foreseeable future.
  4. Expanding domestic consumption. Stimulating local demand for T&A is also given a high priority in China. This is a move that will help both create new market opportunities for T&A companies and make them less vulnerable to the fluctuations in the international market. Specifically, government sets the goal to expand domestic consumption for apparel, home textiles and industrial textiles by 3%, 3% and 10% annually (or 15.9%, 15.9% and 61.1% cumulatively from 2011 to 2015).


Indeed, China’s T&A industry has many specialties, such as its huge size and the heavy involvement of policy in guiding industry’s future development. However, in many ways, China’s T&A industry is also NOT unique. The slow-down of export growth, relocation of low-end manufacturing, and moving towards more domestic consumption, reflects a development path for China’s T&A industry that is very similar to what has happened in other countries such as Japan, Germany, South Korea and even the United States. Understanding the stages the T&A industry has gone through in these developed economies will help us foresee how the size and nature of China’s T&A industry will continue to evolve in the years ahead.

Sheng Lu is Assistant Professor at the Department of Textiles, Fashion Merchandising and Design, University of Rhode Island. Marsha A. Dickson is Faculty Chair and Co-Director of Sustainable Apparel Initiative, at the Department of Fashion and Apparel Studies, University of Delaware. Image Credit: CC by dianaoftripoli/Flickr

Food safety challenges call for big changes in Chinese food companies

Written by Nicoletta Ferro.

Ensuring food security, in terms of ongoing availability of food provisions, has always been one of the top priorities in the Chinese government agenda. Memories of the Great Famine are still vivid in the mind of many Chinese and while the country has succeeded in combating hunger and gained food self-sufficiency, concerns still exist. As Beijing is faced with the challenge of feeding its growing population (around 1.3 billion of which 65% will be living in urban areas by 2050) with only 7-10% of arable lands, solutions are envisaged for the future. But while boosting domestic agricultural productivity is a goal that can be achieved through both technological innovation and land acquisitions for agricultural use (what is generally defined as land grabbing), food safety, an umbrella term that encompasses many facets of handling, preparation and storage of food to prevent illness and injury, is emerging as a much more complex issue for China to confront in the next few years.

The intensive exploitation of natural resources, partly due to unregulated economic development and to an excessive use of cheap chemical fertilizers, has jeopardized food safety in the country. Recently disclosed official data reveal that at least 60% of Chinese ground waters are severely polluted. Unofficial data rise this percentage to nearly 90%. As ecosystems are closely connected, bad water also means contaminated soil. Been locked away as a state secret until recently, data on land pollution have been made public following a survey released in April 2014 that claims 16.1% of the country’s land and farmlands contain excessive levels of pollutants. As food safety includes a wide range of issues (poisoning, alteration, bad storage, additives) and involves the whole food chain, from production to consumption, threats do not only come from contaminated natural environment or poisonous productions processes, but also from unregulated and harming food processing procedures.

The 2008 milk formula scandal (when baby milk was poisoned with melamine) that brought the country’s dairy industry to collapse, was only the beginning of more food related scandals that followed and that continue to be reported by both domestic and foreign media. This lead to a strong call for industry sector reform. Changes can start from the government side but efforts are also expected from Chinese agri-food companies that are called to commit to a massive transformational change, encompassing both mindset, behavioral change and processes upgrade. Innovation in business models is not only a firm-level issue. Developing knowledge and capacity necessary to accelerate the transformation of business to safer and more sustainable enterprises, includes learning how to change the way individuals think and act; change the structures, strategies, processes and products of organizations. Moreover, it must go through changing the systems that corporations are part of – markets, regulations and culture. A complex challenge that China has to embrace if the country wants to operate the shift to a more mature industrial model (as recent political reforms witness), boost its national competitiveness on a global scale and assure a good quality of life for its citizens.

Nicoletta Ferro is Senior Researcher at GOLDEN (Global Organizational Learning and Development Network) a global research network focusing on business model innovation towards sustainability based at Bocconi University. This article is an excerpts  from the book she curated on China and sustainable development, ”Cina e sviluppo sostenibile, le sfide sociali ed ambientali del XXI secolo”. Image Credit: CC by Design for Health/Flickr

Reducing Food Waste to Boost China’s Long-term Food Security

Written by Zhang-Yue Zhou.

What is food waste? According to the Food and Agriculture Organization of the United Nations, food waste at the consumption stage is the food discarded which is still suitable for human consumption.

Food waste at the consumption stage in China is enormous. According to China’s Bureau of State Grains, food wasted each year at dining tables is worth about 200 billion Chinese yuan, equivalent to the amount of food enough to feed over 200 million people. The estimate by another source is even higher: food wasted in China at the consumption stage would be sufficient to feed 250 to 300 million people each year. It is difficult to trace the origins on how these estimates were derived. It is highly probable that they are overstated. Nonetheless, the enormity of food waste can be easily witnessed across China in dining halls, restaurants and other food-eating outlets.

The reasons for such a large amount of food waste in China are diverse and complex. The reasons also tend to be somewhat different from those in other societies. Some of them are historical and cultural.

China used to be a land of famine. The last large-scale famine during which over 36 million people starved to death occurred in the late 1950s and early 1960s. Due to frequent severe food shortages and famines, people often went without regular meals. As such, people often used to greet each other (a practise that continues today) by asking, “Have you eaten?” Offering food to visitors was and continues to be an important custom.

Nowadays, when entertaining others, offering a lot of food has become a way to show hospitality as well as to earn “face” because one could be seen as wealthy. Often, in commercial eating outlets, left-overs are not taken away for later consumption. Taking away left-overs may be seen as not “wealthy”, thus face-losing. Recent effort in public media to convince residents that taking away leftover food is the right thing to do has encouraged many people to take away left-overs for later consumption. However, still on too many occasions, left-overs are not taken away. Food waste at functions such as receptions, weddings, funerals, and birthday parties could be further reduced.

As an agrarian society for thousands of years, ordinary Chinese people have been poor. Too many Chinese people are so scared to be seen as poor. Reflected in dining, one may order well in excess of the needs (even without guests) in order to satisfy their psyche for being seen not poor or stingy. In commercial dining facilities the pressure often also comes from waiters and waitresses who make use of people’s psyche and subtly coerce the diner to order more so that they can earn more.

The Chinese way of dining (sharing foods from the same dishes with one’s own chopsticks) also contributes to food waste. While using one’s own chopsticks to pick up foods from the same common dishes is a great way for infectious diseases to pass on, it also discourages one to keep or take away left-over foods for later consumption, due to hygiene concerns. The waste due to this kind of food sharing is greater when not all diners are close family members.

Using public money for dining and widespread corruption leads to huge food waste, too. When using public money for dining, excessive amounts of food could be ordered. When entertaining others in an attempt to curry favour, food presented on the dining table of course has to be plentiful and expensive, and generally no one would care to take away any left-overs. The recent anti-corruption campaign has curtailed food consumption using public money and the acceptance of invitations by officials to attend luxurious dinners for illegitimate purposes.

Increased disposable income as a result of China’s fast economic growth has led some residents to no longer cherish food. Generally, food waste is higher in families with higher disposable income. Some individuals eat (and often, just order) excessive amounts of food simply as a way to show off that they are rich and they can afford it, feeling little guilt about wasting food.

Worth particular mention is a group of people who waste a lot of food: university students. Food waste in the dining halls of many universities across China is heart-breaking. These students, living in times of plenty, have little sense of cherishing food. When they buy, they care little about the price; if they do not like the food, they just throw it away. The majority of them are only children and they have an “unlimited” supply of money (except those from extreme low-income families) because the whole family supports (read: spoils) the only child.

Reducing food waste is of crucial importance to China for improving its long-term food security. In the past few decades, there have been rapid changes in food consumption patterns. Chinese people nowadays eat less food grains but more foods of high protein such as meats, dairy and aquatic produce. Much more resources are needed to produce such protein food than food grains. China’s food production resources are very scarce. Avoiding food waste is equivalent to having increased food production resources and food supply, thus enhancing the country’s future food security.

To significantly reduce food waste, education is the key. Recent efforts by public media in China to educate residents to avoid wasting food is very welcome. Many younger people, especially those who were born after the 1980’s, have little understanding about the misery of food shortages. Many of them do not know that in the not too distant past, there was a Great Famine in China. They have little sense about the importance of saving food. These young people should be routinely educated that wasting food is a disgrace. While each and every person is entitled to having food, no one has the right to waste food.

Education will be less effective in curtailing food waste resulting from public money consumption and bribery consumption. While the recent anti-corruption campaign has greatly deterred these kinds of consumption, reforms are still needed to establish necessary institutional arrangements so that public money will be used accountably and corruption will be effectively prevented in the first instance. This way, food waste on such occasions can be continuously reduced or avoided in the future when the current anti-corruption campaign ends.

Zhang-Yue Zhou is Professor in Business Studies at the School of Business at James Cook University, Australia. Recently he published “Food Consumption in China: The Revolution Continues”. Image Credit: CC by elias glenn/Flickr


Duck-rice, honey bees and mandarins

Written by Kathleen Buckingham. 

When asked to name a restoration project in China, the likelihood is that the Loess Plateau will come to mind. The hilly, semi-arid region in north-central China is roughly the size of Afghanistan. Thousands of years of farming, which intensified during the Cultural Revolution, left the former grasslands degraded and eroded. Food production was down, waterways filled with silt, and air in faraway cities suffered sand storms born on the Loess Plateau. A population that rose to 50 million people made the problems worse. China has spent 40 years restoring degraded lands and expanding forest protection. It has invested more than $105 billion in six forest restoration programs covering 76 million hectares of land across more than 97 percent of counties. The government’s drive for large-scale management is strong. In 1999, the Chinese government launched one of the world’s largest conservation programs, “Grain for Green”, in which millions of rural households worked to return agricultural lands to areas with more vegetation, tree cover and erosion-fighting terracing.

According to the World Bank, in some places in the Loess Plateau local farmers saw their incomes double, erosion reduced by 100 million tons of sediment annually, a reduction in flood risk, and grain production dramatically increased. However, these results came with costs. The speed of China’s efforts was only possible by using single species or minimally diverse plantings, and local communities were often unable to enjoy the benefits of restored forests. Whilst in some areas, restoration has protected land from desertification and brought better rural livelihoods, in others, trees have grown slowly and some are already dying. Tree survival rates have been recorded as low as 25 percent in some regions. Chinese experts readily admit trees were sometimes planted in arid regions better suited to grass. This has led to a growing desire to ‘green China naturally’.

China’s historic forest loss has made it one of the world’s most forest-deficient countries, with a national forest cover of 22 percent, compared to a global average of 31 percent. Tree loss is just the tip of the iceberg. China also stands as one of the most water-stressed countries on the planet having 21 percent of the world’s population but only 6 percent of its freshwater. Sustainability of both water resources and land affects the population and the economy. Water and land use are inextricably linked. The Loess Plateau, aimed to restore the watershed, but clearly new approaches are needed to guarantee ecological and economic sustainability – in terms of tree and livelihood survival.

An interesting partnership has emerged which promises to address this issue. Danone, a multinational food-products corporation, Danone Waters China (DWC) and IUCN (International Union for Conservation of Nature) have joined forces to restore the Jiaquan watershed in the middle of the Donjiang Basin, as part of a larger watershed protection project in Southern Guangdong Province. As one of the three major branches of the Pearl River, the Dongjiang River and its river basin represent a critical resource, supporting the economy and population of the Pearl River Delta. The Dongjiang River Basin provides water to more than 400 million people and six major Chinese cities including Guangzhou, Shenzhen and Hong Kong. Ironically, it is not the trees in this case that are protecting the water source. Economic tree plantations, agricultural practices and the application of chemical and community waste is causing pollution in the watershed. The watershed water’s quality and quantity is currently at risk from geological hazards and disasters as well as community lifestyle and agricultural practices. The aim of the project is to empower local communities through a public–private partnership that aims to provide sustainable livelihood opportunities, maintain healthy ecosystems and promote a supportive policy for sustainable watershed management. Aside from the corporate vision, how does this work in practice?

The private sector has an important stake in restoration. Their business relies on the land. In the Pacific Northwest, a group of international experts came together for a seminar on forest landscape restoration. In the forest, participants told their restoration story. Zhang Hanqian, a representative from Danone, told a story that was frankly inspiring. There is a food security crisis in China. Unlike the environmental agenda that faces potential conflict and censorship from the government, food is an ideal entry point to relieve tension through aligning on a common agenda – from the government, to NGOs to the private sector. The Chinese word for ‘crisis’ is illustrative in this case -the combination of the words ‘danger’ and ‘opportunity’ provide a platform for two issues to come together – popularizing the danger of the food industry (of toxins, additives and bioaccumulation) coupled with the environmental needs for restoration. The drive for green food in China has come at a time when safety concerns are paramount, when, Western internet aside, China is finding their own channels of online communication.

Danone are starting small piloting projects based on techniques in ‘bio-dynamic agriculture’ from Australia. The area was blighted with Huanglongbing, what was locally known as ‘mandarin cancer’. The area suffered from pests and diseases in monoculture mandarin plantations while farmers made money from rapid growing Eucalyptus. The area provided for the economy while the landscape began degrading. Three key practices have been trialed to address restoration challenges involving ducks, bees and mandarins. Prior to planting rice in the sub-tropical south, natural legumes have been planted to fertilize the soil. The practice aims to recreate a natural practice of soil fertilization. After the wetland rice has been established, baby ducks are introduced to act as ‘natural pesticides’ by eating the insects and providing natural fertilizer. The rice works on rotation and is part of a wider landscape of honey production and ‘vertical orchids’ which aim to create spatially and temporally ecologically appropriate plants all year round. Beekeepers in recent years have been so stretched for pollination that they have been forced to load bees on trucks to travel in search of pollinating plants.

Working on a small-scale won’t solve the problem of degradation globally. There has to be a financial model which allows the farmers to see the impact of restoration on their business – one that allows them to switch to native Chinese Fir instead of non-native, rapid growing Eucalyptus – one that provides competitive prices in the high-end honey market and proves that mandarins can be farmed without high chemical input. Zhang Hanqian believes creativity is the key, but also economies of scale. Maybe we can use the Chinese food crisis in all its forms and connotations to start a movement for restoration.

Kathleen Buckingham is a Research Associate at the World Resources Institute. The opinions in this piece are the author’s own and do not represent those of her employerImage Credit: CC by Danone

China’s environment, modernisation and investigative reporting

Written by Jingrong Tong.

In a recent book I examined environmental risk discourses constructed through environmental investigative reports and their contribution to offsetting the hegemonic discourse of modernisation promulgated by the Chinese state. I analysed the practices and outputs of environmental investigative journalism, discourses on environmental problems as well as the interaction between offline reporting and online discussion on environmental issues. I was fascinated to find that environmental investigative reports have revealed the true nature of modernisation–which is neither people nor environmentally friendly–and the link between environmental and social inequalities so that environmental risk discourses have a counter-hegemonic function.

The practice of modernisation has been quite successful in China in terms of achieving economic development and GDP growth. The prevailing discourse of modernisation is even integrated into the life and daily rhythms of Chinese people. The Chinese state has made “modernise for a better life” a major rhetorical device, which weaves a sweet and utopian dream for its people. In this dream, social inequalities are narrowed and poverty is minimised. In this dream, China is a strong nation and people are wealthy and healthy. This dream has won most Chinese people over so that pursuing modernisation becomes a hegemonic and ideological discourse legitimating the rule of the Chinese Communist Party. By propagating the myth of modernisation, the Chinese state has also managed to shift the attention of its people from political to economic reform, which reduces the chances of generating political instability and therefore consolidates the rule of the CCP.

In order to realise modernisation, China needs rapid economic growth. This need echoes global capital’s desire for international expansion. China has experienced quick industrialisation and transitioned from an agricultural to an industrial society. However, the wide range of economic activities have ignored the consequences for the environment. This negligence has generated two types of problems. First, accompanying the pursuit of modernisation is the increasing prevalence of environmental problems occurring across China. Ranging from pollution to resources exhaustion and desertification, environmental degradation has become a pressing issue that China’s authorities need to deal with urgently, as it threatens the well-being of Chinese residents. Destruction of biodiversity, pollution-linked illnesses like cancer, and food security have all become cause for concern and it is increasingly obvious that environmental problems will not go away automatically.

Second, the amalgamation of environmental and social inequalities undermines the foundation of Chinese society. Capital always craves national resources in order to maximise profits and such a desire has been indulged by the Chinese state, a result of which is the complete exploitation of nature, generating environmental inequalities and deepening social inequalities. Social inequalities in the command of natural resources result in environmental inequalities that in turn deepen social inequalities and divides Chinese society. Those privileged individuals and social groups who enjoy advantageous social resources exploit natural resources to increase their own wealth, while the disadvantaged are left to suffer the environmental damage caused by this exploitation. In many cases, the poor not only become poorer but are also vulnerable to diseases caused by environmental pollution. The situation is distressing to witness.

One response to this worrying situation has been the recent rise of environmental movements as well as environmental non-government organisations (ENGOs). From anti-PX protests to protecting snub-nosed monkeys, from Dalian to Guangzhou, many environmental campaigns have been organised and launched since the 1990s. Like those in other societies, China’s environmental movements have limitations.For example, most of them only pay attention to their own “backyard” issues. Nevertheless, proactive participation pushes environmental protection to a new level and puts pressure on the political leadership.

Chinese governments are making efforts to alleviate environmental problems in order to take off the pressure on governance brought in by environmental problems. These efforts can be traced back in the 1970s, when China attended the 1972 United Nations Conference on the Human Environment. Since then, environmental protection legislation and government departments have been established and regulations have also been published, including environmental policies issued to lessen environmental damage. The issue of environmental protection, for instance, was one of the main focuses of discussion at the latest legislative meetings (lianghui) earlier this year. Nevertheless, after all these years, the physical situation continues to worsen. In fact, as long as economic development and modernization remain China’s priorities, environmental problems will not be truly solved. The understanding that environmental problems have roots in modernisation may merely be the emperor’s new clothes.

Despite media control in China, investigative reporting on environmental problems has managed to expose the link between environmental problems and modernisation. Encouraging journalists to investigate and disclose environmental problems was a win-win strategy for the CCP. On one hand, investigative reporting can help the CCP to monitor and prevent wrongdoing by local authorities, institutions and individuals that damage the environment. On the other hand, exposing environmental problems facilitates journalists’ pursuit of greater autonomy, and gives them additional motivation to do so. Benefiting from this strategy, environmental investigative reporting has blossomed since the 1990s. A wide array of topics and agendas ranging from anti-deforestation to anti-dam construction have been covered and thus brought to prominence. The public’s attention is driven to environmentalism, as it is constructed in these investigative reports, and environmental awareness, which is crucial for a risk society. It is apparent from the research reported in the book that although serving the CCP’s interests, investigative reports have constructed environmental risk discourses that oppose the supreme discourse of modernisation and thus portrays the rift between modernisation and the environment.

Enjoying autonomy in covering environmental problems is only one side of the story. China has recently been stunned by the shocking reality of air pollution revealed in Under the Dome, an online documentary produced by Chai Jing, a former TV presenter and investigative journalist of renown at CCTV, which was soon censored by the CCP. Since Xi Jinping came to power, his attitude toward news media has been harsh and media organizations that are seen as intractable and uncooperative have suffered crackdowns. With these developments, the future of environmental investigative reporting is uncertain.

Jingrong Tong is Lecturer at the University of Leicester. She is the author of Investigative Journalism in China and Investigative Journalism, Environmental Problems and Modernisation in China. Image Credit: CC by Gustavo M/Flickr.

The Three Gorges Dam: China’s Clean Energy Hero or Villain?

Written by Christopher Dent.

Hydropower remains by far the world’s dominant renewable energy source for producing electricity, still well over twice the combined installed global capacity of wind and solar. China accounts for over a quarter of worldwide hydropower installed worldwide, having embarked on the world’s most ambitious large dam-building programme since the 1990s. By 2013, the country’s total installed hydropower capacity was 260GW: to put this in context, the total power generation capacity Britain’s electricity grid is around 100GW.

China’s Three Gorges Dam (TGD) on the Yangtze River is the largest of numerous 1GW-plus rated dams the government has commissioned to be built during the last two decades. It may be viewed as both hero and villain of the country’s renewable energy development (Dent 2014). Becoming fully operational in May 2012 with an installed capacity of 22.5GW, the TGD has been a flagship project of Chinese economic development generally. Its annual ‘clean energy’ saving of 31 million tonnes of coal and 100 million tonnes of greenhouse gas emissions makes a significant contribution to de-carbonising China’s energy sector. Yet the huge socio-economic and environmental costs arising from both the TGD’s construction and operation have made it highly controversial, and a target of much criticism inside and outside the country.

The initial idea for the TGD was first proposed by the Nationalist government in 1919. Much later, the Mao government started to conduct feasibility studies on the dam in the 1950s but in the 1960s China still lacked the technical capability to build it, and in the 1970s the money to finance it. Only by the mid-1980s was the government able to put together a viable plan for the project (Fearnside 1988). In 1992, this plan was approved by the National People’s Congress but with a record number of delegates (32 percent) either voting against or abstaining support for building the dam, which began in 1994 and was structurally complete by 2009. The last of hydroelectric turbines (32 of 700MW rated capacity, plus two at 50MW) were fitted in the 2,335 metre long, 175 metre high installation in 2012. Each one of these large 700MW turbines can alone produce around three to four times more electricity than Britain’s largest windfarm. The dam cost an estimated US$25 billion and created a 600 km long reservoir upstream. At 22.5GW, it is by far the world’s largest power station by capacity rating.

The TGD’s hydroelectric function was the primary motive for construction but other functions are also important. Over the last century or so, major catastrophic floods on the Yangtze River occurred in 1911, 1931, 1935, 1954 and 1981, resulting in over 300,000 deaths and millions of displaced people. A later flood event in 1998 killing over 4,000 people, inundated 25 million hectares of farm land and caused material damage estimated at US$36 billion provided stronger justification for the TGD. The dam is also situated in a critically important area: the Yangtze River basin is home to one-third of the national population, around 70 percent of the country’s rice fields, and roughly 40 percent of Chinese industrial output (Liu et al 2013, Tullos 2009). Building the dam would spur economic development in this key riparian zone by improved navigation: the maximum ship size on the river increased from 2,000 tons to 10,000 tons and thereby considerably strengthened commercial transportation links between major interior cities such as Chongqing to the east coast (Jackson and Sleigh 2000).

While the TGD has delivered many benefits it has also incurred considerable environmental and socio-economic costs. Its construction necessitated the inundation of two cities, 11 counties, 140 towns, 326 townships, and 1,351 villages covering 23,800 hectares and the resettlement of an estimated 1.5 million people (Liu et al 2013). Although around 35 to 45 percent of the project’s budget was allocated to resettlement and compensation for affected local communities, according to International Rivers (2014) there were reports of this process being badly mismanaged and subject to notable levels of corruption by implementing local government officials, with around 12 percent of funds embezzled. Filling the TGD reservoir is thought to have destroyed a number of archaeological sites of important cultural interest. Ecological costs and geological risks associated with the TGD’s development have included (International Rivers 2014, Solidiance 2013):

  • Undermining the Yangtze River’s rich biodiversity, as the dam is located in one of its conservation areas where 25 endangered fish species exist, such as the Chinese sturgeon, river sturgeon, river dolphin and paddlefish.
  • Stagnant water forming in the TGD’s long reservoir where industrial effluents discharged by factories upstream into the river has accumulated, creating regular algae blooms. Reservoir siltation has too accumulated to notable levels. In addition, silt-free water released from the dam is causing significant erosion of river banks downstream, thus counteracting some of the TGD’s flood control benefits.
  • Soil erosion is affecting more than half the reservoir area, causing frequent landslides and an estimated 178 kms of river banks thought to be at risk of collapse. If this transpires, another 530,000 people will need relocating by 2020 as a result of this risk.
  • Seismic activity in the TGD reservoir zone has increased since its filling process was substantially completed by the late 2000s.

China’s national government agencies have exhibited growing concern over the high socio-economic and environmental risks associated with the dam’s construction and operation, these closely connecting with key challenges it faces generally with its large-hydro development strategy. In September 2007, Beijing acknowledged the need to strengthen environmental impact assessment procedures applied to the TGD, and later in May 2011 conceded that its installation has posed notable environmental, geological and socio-economic welfare risks (International Rivers 2014). Despite the adoption of stronger environmental protection laws and regulations introduced by the government since the early 2000s, weaknesses in their design and implementation (e.g. on punitive fines for non-compliance, and regarding stakeholder engagement) has given more scope for the adverse impacts of China’s large dams like the TGD to go unchecked. The resultant problems arising from the Three Gorges Dam project has thus caused many doubts concerning the future of other large-hydro developments in progress, not just in China but also worldwide. The Chinese government currently has no plans to introduce any new large-hydro dam projects beyond 2020, and is instead concentrating its renewable energy policy on wind, solar and other dynamic sectors where it too is emerging as a world leader.

Christopher Dent is Professor of East Asia’s International Political Economy at University of Leeds. Image credit: CC by Pedro Vásquez Colmenares/Flickr.


Dent, C.M. (2014) Renewable Energy in East Asia: Towards a New Developmentalism, London: Routledge.

Fearnside, P.H. (1988) ‘China’s Three Gorges Dam: “Fatal” Project or Step Toward Modernization?’, World Development, Vol 16(5), pp 615-630.

International Rivers (2014) International Rivers: Dam-Building Database, available at:

Jackson, S. and Sleigh, A. (2000) ‘Resettlement for China’s Three Gorges Dam: Socio-Economic Impact and Institutional Tensions’, Communist and Post-Communist Studies, Vol 33, pp 223–241.

Liu, J., Zuo, J., Sun, Z., Zillante, G. and Chen, X. (2013b) ‘Sustainability in Hydropower Development: A Case Study’, Renewable and Sustainable Energy Reviews, Vol 19, pp 230–237.

Solidiance (2013) China’s Renewable Energy Sector: An Overview of Key Growth Sectors, Shanghai: Solidiance.

Tullos, D. (2009) ‘Assessing the Influence of Environmental Impact Assessments on Science and Policy: An Analysis of the Three Gorges Project’, Journal of Environmental Management, Vol 90, pp 208–223.






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