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China battles auto addiction
By Antoaneta Bezlova

BEIJING - On a recent "Car Free Day" in Beijing, the capital of China was clogged with vehicles and the sky a drab shade of gray. The sheer number of cars on the roads had made a mockery of the city initiative to make residents ride bicycles or use public transport.

"I have been riding my bicycle since I was in primary school," renowned Chinese environmentalist Liang Congjie said. "But in recent years I don't feel safe on Beijing roads and I have to take acab. More and more cars are eating up the bicycle lanes. The private cars have now become real street despots."

While in Beijing there are still 2.4 million people who ride their bicycles to work every day, nearly 1,000 new cars hit the streets daily. China's roads will be clogged with 170 million vehicles by 2020, according to the World Bank - by which time the country would have surpassed the United States in total car ownership.

"No one is doubting that more and more Chinese people are going to reach that threshold of affordability - to buy their own car," said John Humphrey, manager of China operation for the US-based car-industry consultants J D Power Asia-Pacific. "The pace of change we have seen in China's auto market is astounding, but demand is still growing."

Seven million cars are sold in China each year. That means China this year left Japan behind to become the second-largest car market in the world after the US, where more than 16 million cars are sold annually.

Such phenomenal growth has had analysts rushing to calculate the environmental consequences if every Chinese family realized its dream of owning a car.

Emissions from cars in the United States alone now account for about 5% of worldwide carbon-dioxide emissions, according to the US Department of Energy. If China matched the US in per capita ownership, its vehicles would make a huge contribution to global carbon-dioxide output, dwarfing any cuts in the emissions that the rest of the world can make.

"China can no longer afford to sacrifice environmental concerns for the sake of prosperity," said Xue Ye, executive director of Friends of Nature, China's largest environmental civil group.

No one is more worried about the consequences of such prodigious growth than Beijing's leaders. They had promised to hold "Green Olympics" in 2008 and have less than two years to solve the escalating problems of air pollution and traffic jams in the capital.

They are now considering a temporary ban on private cars during the Olympics, but many say this could only be a stopgap measure for the real problems plaguing Chinese cities.

"Instead of allocating resources towards moving people and building a mass-transit network, China has invested heavily in developing its auto industry," said Rob Watson of the US-based Natural Resource Defense Council.

As Chinese citizens grow wealthier and demand the consumerist trappings of their counterparts in the developed world, Beijing is walking a tightrope in balancing its promises to raise living standards while keeping pollution and surging oil demand under control.

The dilemma is not an easy one for a leadership fixated on modernization and aspiring to have the country join the ranks of developed consumer societies as soon as possible.

While fretting about urban gridlock and air pollution, the Beijing municipal government controls and benefits from Beijing Automotive Industry Corp, a car maker that has joint ventures with DaimlerChrysler and Hyundai Motor Co. The same is true for Shanghai, whose leaders receive dividend payments from the state-owned Shanghai Automotive Industry Corp, and for the southern city of Guangzhou and almost every other first-tier city in the country.

"There are enormous profits to be made from the auto industry," said Li Dun, a research fellow with the Contemporary China Research Center at Tsinghua University. "But these come with a price tag - the stress caused to our environment and our energy resources."

China's automobile industry, which employs 1.7 million people, has become one of the pillars of the country's economy, providing jobs and bringing large tax revenues. China's auto makers are now beginning to make inroads into overseas markets, selling cars and trucks to Iran, Syria, Egypt, Indonesia, Vietnam and other countries.

Limiting the rapid growth of China's auto market at this stage could be not only difficult but also politically explosive. For the country's expanding middle class, acquiring one or two cars simply means aspiring to match the living standards in the developed world.

Experts reckon shattering China's middle-class dream would be close to impossible. "The majority of individual consumers [who] buy new cars in China - more than 80% - do so for the first time," Humphrey told the Foreign Correspondents Club in Beijing.

Beijing, which has 2.5 million vehicles - more than any other Chinese city - has almost no limitations on car usage. Worried about public discontent, Chinese leaders have also shied away from fuel-consumption taxes that have encouraged people to drive less in Europe.

Instead, the central authorities have opted to institute tough new fuel-economy standards for domestically produced cars and trucks and equally strict vehicle-emissions regulations. Once fully implemented in 2008 and 2010 respectively, these regulations will put Chinese cars at par with automotive standards in the European Union.

The push to improve China's environment is coupled with concerns over the impact of car-ownership growth on national oil security. Domestic cars are burning through a steadily increasing proportion of the oil consumed in China, rising from 10% in the mid-1990s to a likely 40% by 2010, according to government figures.

About one-third of the oil currently consumed in China is imported, and analysts project that the country will depend on imports for 70% of its oil needs by 2010.

This year the government reversed a decade-long ban on small vehicles in the capital to encourage the purchase of more efficient models. It has also imposed taxes on gas-guzzling vehicles and begun experimenting with environmentally friendly car technologies, such as hydrogen-powered cars and biofuels.

But whether China becomes an environmental pioneer will depend on the government's commitment to enforce the standards it sets and fulfill its ambitious green pronouncements, experts contend.

"It is a public consensus that we don't have to follow in the United States' path by building so many roads, producing so many cars and using so much oil," said Li Dun. "The problem is how to implement the consensus. There are still plenty of city leaders and even some central government ministries that are steering us on to this very same road."

(Inter Press Service)http://www.atimes.com/atimes/China_Business/HJ05Cb01.html
 
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