Wuhai, a small, out-of-the-way city in the Inner Mongolia Autonomous Region, is working wonders, with its per capita GDP reaching 20,000 yuan (US$2,500) and its economy growing by an amazing 40 per cent each year.

The picture was entirely different 10 years ago, when this author visited the small city of 400,000.

At the time, industrial restructuring had just got under way, and the State's attention was focused on large-scale enterprises. Small businesses were left at the mercy of market forces.

Because of this, many small enterprises in this small city were struggling just to survive or went bankrupt outright. Workers' livelihoods, therefore, were nondescript.

After the visit, this author always saw in his mind's eye the poverty-stricken local people - the migrant workers eking out a living, sheltered in the shanties on the edge of the desert, and the high school students preparing for college entrance examinations in their dilapidated homes.

Things have since changed dramatically, however.

Abounding in energy resources and turning out plenty of electricity, Wuhai jumped at the opportunity as the economically developed eastern coastal regions were shifting energy-consuming industries out to other areas.

Thereby, industries such as coking, making calcium carbide and ferrous alloy sprung up one after another in Wuhai.

These industries helped largely promote local economic growth. By the end of the 10th Five-Year Plan (2001-05), for example, local revenue was three times that at the end of the Ninth Five-Year Plan (1996-2000).

However, the energy-consuming and highly polluting industries, while bringing hefty wealth to Wuhai, created a heavily polluted "black triangle" wedged between Shaanxi and Shanxi provinces and the Ningxia Hui and Inner Mongolia autonomous regions. The mayor of Wuhai acknowledges that in the past, the area was dying from poverty by the side of a trove of energy resources but now is being choked to death by pollution.

Under the pressure of a package of environmental protection measures enforced by the State, Wuhai's resource-dependent economy is transitioning to a more environmentally friendly model.

A price, however, has to be paid.

The chief indicators of the local economy, for example, all slid in the first quarter of this year. The GDP growth rate dropped significantly compared with the corresponding period for last year.

The trajectory of the social and economic development in Wuhai epitomizes the development bottleneck confronted by the nation as a whole: how should man get along with nature in harmony?

The central government, the media and the public are showing increasing concerns over the country's environmental deterioration. Premier Wen Jiabao, for instance, pointed out that all primary targets of social and economic development in the 10th Five-Year Plan were fulfilled, except that of environmental protection.

Investigation teams sent out by the National People's Congress warn that there is no reason for optimism with respect to the quality of the air and river water in the whole country.

The State Environmental Protection Administration estimated that the country's economic losses due to pollution stood at 511.8 billion yuan (US$64.6 billion) in 2004, accounting for 3.05 per cent of GDP that year. Top environmental protection authorities report that 130 cases of river-water pollution have been registered since the pollution in the Songhua River late last year.

All this shows that on the one hand, environmental improvement has become the imperative task that will not wait to be tackled; but on the other hand, the public and governments at various levels have become more keenly aware of environmental protection's importance to sustainable development.

Public opinion's strong response to environmental protection is a good thing, because it shows that Chinese citizens, who are significantly better off than a few decades ago, have got a much stronger sense of responsibility towards affairs beyond the scope of their daily cares.

The country, on its path of development, hopes to avoid the traditional pattern of tackling the pollution only after it becomes a reality. But no experience of success has been offered by either the Western developed countries or the newly emerging industrialized ones. China has travelled through twists and turns in this regard, too.

In the 1950s, the Chinese, in their bid to industrialize the country, believed that man eventually prevailed over nature. In the early 1990s, the country worked out plans for sustainable development after undergoing environmental ups and downs. Now the nation has come up with the scientific outlook for development, which emphasizes that individuals and society, man and nature and China and the world go along in harmony.

However, it will take painstaking effort to translate the newly acquired ideas into reality, including reform of the economic infrastructure, industrial restructuring, getting rid of the GDP-first mentality and elimination of corruption and localism.

The good news is that we now have the country's first "green" research report on the calculation of the national economy. For the first time, the Chinese have come to know that huge economic losses caused by pollution and the great cost needed to tackle the pollution combine to cut the GDP growth index by half!

We should hail the coming of this "green" report as a sobering agent.

The author is a researcher with the China Foundation for International and Strategic Studies

(China Daily 09/27/2006 page4)