China's leadership has also taken other steps to address China's oil demand. Hu Jintao, president of China since March 2003, led the nation into a deeper dependency on oil from the Middle East. Under Hu's leadership, China has taken measures to increase the amount of the oil it imports from Iran. In October 2004, China's large oil company, Sinopec Group, signed a $100 billion, 25-year oil and gas trade agreement with Iran—China's largest energy deal with the country that is the number-two oil producer in OPEC. Iran's former minister of petroleum, Bijan Namdar Zanganeh, said that Iran is China's major oil supplier and that Iran wanted to become China's long-term business partner.
A few years prior, in 1998, China's former president, Jiang Zemin, made the first visit by a Chinese head of state to Saudi Arabia. During this visit China and Saudi Arabia formally approved certain oil cooperation agreements and discussed plans for using Saudi oil in a large Chinese petrochemical complex. Earlier, in 1995, China agreed to import 3.5 million tons of crude oil from Saudi Arabia annually.
Commentators have pointed to these and other arrangements with Middle Eastern oil-producing countries as a sign of China's limited ability to meet its oil needs. The increased reliance on oil from the Middle East demonstrates a major difference between the United States and China in their approach to domestic oil shortfalls, as the strategy of the United States has involved at least an attempt to cut back on Middle Eastern oil imports.
China has also made massive investments in infrastructure projects in Africa in exchange for securing contracts in Africa's energy sector. This Chinese strategy for ensuring continued oil supply has incited the disapproval of the United States and other Western nations because some of China's dealings are with African states that are notorious for their human rights abuses.
DIVERSIFYING THE SOURCES OF ENERGY China's nuclear power program has gained momentum in recent years, as China has been investing in the construction of several nuclear power plants. Another Chinese approach to handling its accelerating oil demand has been an effort to convert the country to alternative sources of energy. The reasons for making such a switch include not only the concern that China will soon be unable to meet its immense energy demand but also the serious problems with pollution and environmental degradation caused by China's swift industrialization and extensive reliance on oil and coal. China is the second-largest emitter of greenhouse gases after the United States. And China's level of energy efficiency is one-quarter that of industrialized countries like the United States, according to the United Nations Development Programme (UNDP). Furthermore, rapid economic development in China has led to not only harmful fuel emissions but power shortages. Such energy-related issues are compounded by the fact that China has limited available natural resources; agricultural activities have stripped China's land of its protective plant canopy and exhausted the land's fertility. Moreover, China's booming population, coupled with agricultural encroachment upon scarce arable land (particularly through irrigated rice farming), has generated soil erosion, deforestation, grassland destruction, and soil and water pollution. China reportedly lost 20 million hectares of cultivable land between 1957 and 1977. The UNDP has also reported that only 75 percent of China's citizens are assured access to safe drinking water.
According to the EIA, China's renewable energy consumption in 2003 accounted for only 3 percent of total energy consumption. In 2005, China passed a significant renewable energy law, known as the Renewable Energy Law, which has won praise from some U.S. environmentalists, who say it is a good model for the United States to follow in formulating future U.S. energy policies. This law is expected to boost China's capacity to use renewable energy to 10 percent by the year 2020. Through passing this law, the country aimed to institute measures that would protect the environment, prevent energy shortages, and reduce dependence on energy imports. Effective in 2006, the law stipulates the following:
1. That electricity power grid operators purchase resources from approved renewable energy producers
2. That national financial incentives be available to foster state and local development of renewable energy resources, including solar electricity, solar water heating, and renewable energy fuels
3. That loan and tax discounts be given for renewable energy projects, such as the construction of commercial renewable energy facilities
4. That specific penalties be imposed for noncompliance with the law
The law includes in its definition of renewable energy hydroelectricity, wind power, solar energy, geothermal energy, and marine energy. In addition, China's National Development and Reform Commission (NDRC) will establish specific renewable energy targets for China as the framework for the implementation of this law. In relation to the law, China has also unveiled plans to increase environmental spending from 0.7 percent of GDP in 1996 to 1.7 percent in 2010 and 10 percent in 2020.
There are a number of other environmental laws and regulations that China has instituted in order to improve its environmental situation and address its energy issues. Xie Zhenhua, head of China's State Environmental Protection Administration (SEPA), pledged in 2005 that China would maintain its commitment to environmental protection and efficient, sustainable use of natural resources. The UN secretary-general, Kofi Annan, awarded Xie the UN's Sasakawa Environment Prize in 2003.
Some significant environmental protection programs that China launched in the past have included a 1970s biodigester waste recycling program and a reforestation policy, but ensuring compliance with these programs by China's agricultural producers proved difficult. However, SEPA has also established a number of successful measures to improve lake, river, and coastal water quality; urban and agricultural environments; and forest and grassland coverage.
In addition, Li Peng, China's former prime minister and later chair of China's National People's Congress (NPC), proposed a plan in 1994, while still prime minister, to create an alternative-fuel "people's car," the production and assembly of which China has since arranged through Volkswagen and other
Western auto companies. Other environmental projects Li promoted include China's Three Gorges Dam, the world's largest hydroelectric plant, designed to generate 18.2 gigawatts of power. In March 2002 the China Yangtze Three Gorges Electric Power Corporation was established, and in June 2003 the reservoir created by the dam began to fill, with its initial turbines operating a month later. As many dams have, the Three Gorges Dam has raised concerns over its potential to cause huge floods that could wipe out local ecosystems and result in human fatalities. The Yangtze project is also controversial because of the million-plus people who are expected to be forced from their homes as the reservoir fills to capacity—a capacity that is said to span the area of 13 cities, 140 towns, 1,352 villages, and 650 factories.14 The cost of the project is also a matter of contention, with an anticipated total bill of $29 billion.15 The water level, too, which is supposed to reach 577 feet, will submerge local archaeological sites and unique natural landscapes that have been a draw for tourists.
While China is still considered to be a major contributor of fossil fuel emissions and a country where rapid economic growth has the potential to cause real national energy crises, efforts are under way to reduce the impact of an ever-dwindling, always-in-demand supply of oil.
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Do we really want the one thing that gives us its resources unconditionally to suffer even more than it is suffering now? Nature, is a part of our being from the earliest human days. We respect Nature and it gives us its bounty, but in the recent past greedy money hungry corporations have made us all so destructive, so wasteful.