VZCZCXRO7641
RR RUEHAST RUEHCN RUEHGH RUEHHM RUEHLN RUEHMA RUEHPB RUEHPOD RUEHTM
RUEHVC
DE RUEHGZ #0486/01 2240932
ZNR UUUUU ZZH
R 110932Z AUG 08
FM AMCONSUL GUANGZHOU
TO RUEHC/SECSTATE WASHDC 7497
INFO RUEHOO/CHINA POSTS COLLECTIVE
RUEHZN/ENVIRONMENT SCIENCE AND TECHNOLOGY COLLECTIVE
RUCPDOC/DEPT OF COMMERCE WASHDC
RUEATRS/DEPT OF TREASURY WASH DC
RUEHC/DEPT OF LABOR WASHDC
RUEAEPA/HQ EPA WASHDC
RHMCSUU/DEPT OF ENERGY WASHINGTON DC

UNCLAS SECTION 01 OF 02 GUANGZHOU 000486 
 
SENSITIVE 
SIPDIS 
 
STATE FOR EAP/CM 
STATE PASS USTR CHINA OFFICE 
 
E.O. 12958: N/A 
TAGS: SENV ECON PGOV CH
SUBJECT: Environmental Impact Assessments vs. Economic Development: 
Business Still Wins in Guangdong 
 
REF: A) GUANGZHOU 228; B) GUANGZHOU 121 
 
(U) This document is sensitive but unclassified.  Please protect 
accordingly. Not for release outside U.S. government channels. Not 
for internet publication. 
 
¶1. (SBU) Summary: Guangdong has set lofty goals aimed at becoming a 
leader in environmental protection, but a look at how it goes about 
doing Environmental Impact Assessments (EIAs) suggests it still has 
a long way to go.  According to contacts familiar with the process, 
auditors can easily manipulate their estimates of a project's 
impact, developers often have cozy relationships with the private 
firms that conduct the assessment, and the mechanisms for gathering 
public comment are flawed.  One retired official suggested that the 
process was a sign of larger problems in a system that still places 
economic growth ahead of environmental protection.  End summary. 
 
Environmental Impact Assessments: "A Bureaucratic Tool" 
--------------------------------------------- --------- 
 
¶2. (SBU) Although Guangdong seeks to become a leader in 
environmental protection, the province's EIA system remains highly 
flawed, according to several of our contacts here. As in the United 
States, every large project in China -- factory, commercial 
development, high rise tower, etc. -- must pass an EIA before it 
receives final government approval.  These costly reports (about RMB 
300,000 or over $43,000 on average) can be critical tools for 
ensuring that development does not have a negative impact on the 
environment.  However, a recently retired official from Guangdong's 
Environmental Protection Bureau told us that EIAs in China are 
merely minor legal and bureaucratic hurdles for developers. 
 
¶3. (SBU) The retired official told us that key figures in many EIAs 
are "made up of random numbers."  He said that the formulas set by 
the State Environmental Protection Administration (SEPA) to 
establish how much environmental impact each locality can sustain 
are valid.  However, auditors who prepare the EIAs know exactly how 
much impact a project can have before it will exceed the allowable 
threshold, and they manipulate their estimates accordingly.  Impact 
assessments always pass and are regarded by EPB officials as nothing 
more than a "bureaucratic tool," our contact said. 
 
Auditors Cultivate Good Relations and Act Fast 
--------------------------------------------- - 
 
¶4. (SBU) Developers and other firms that need an EIA maintain close 
ties with the private companies that perform the assessments.  This 
leaves the process open to manipulation.  According to Dr. Huang 
Ping, Director of the College of Environmental Science and 
Engineering at Sun Yat Sen University, these companies have 
flourished in Guangdong as a result of the province's rapid economic 
development.  Auditing can be very profitable; there is no 
restriction in China on how frequently and/or how often a developer 
or business can utilize the same EIA auditing company. 
Relationships or "guanxi" are important factors as many companies 
sign contracts with national auditing companies to perform EIA's 
throughout China.  Companies often urge EIA auditors to expedite the 
process by working overtime so construction can commence quickly. 
There is very little motivation for EIA auditing companies, who are 
paid by the developer, to produce an assessment that indicates the 
project will have a negative impact on the environment.  In fact, 
Huang of Sun Yat Sen University said that fewer than 5 percent of 
assessments are rejected each year by the EPB-appointed EIA 
commissions that review them. 
 
Not Giving the Public a Fair Hearing 
------------------------------------ 
 
¶5. (SBU) The public comment process for EIA's is also flawed.  In a 
recently published paper, Lin Ping, a researcher at the Fujian 
Environmental Science Research Institute, wrote that the public 
isn't given enough information about how a project will affect them. 
 Public opinions are generally collected in questionnaires that are 
not detailed enough; Lin argued that the government should hold more 
public hearings to gather opinion instead.  He also said that the 
comments are rarely analyzed and instead the process is more of a 
procedural requirement than a genuine inquiry.  In addition, Lin 
believes that the public's environmental awareness is weak and most 
people are only interested in compensation they might receive from 
projects. 
 
 
GUANGZHOU 00000486  002 OF 002 
 
 
Economic Growth Still Come First 
-------------------------------- 
 
¶6. (SBU) In addition to problems in the EIA process, the retired EPB 
official emphasized that urban planning departments at provincial 
and local-level EPB's need to strengthen their environmental 
protection efforts rather than appease those with political power. 
He stated that although the government had publicly put more 
emphasis on environmental goals, economic goals still got priority 
behind closed doors.  He claimed that that the problem is made worse 
by the fact that many EPB officials lack any scientific background. 
Those who do have the necessary technical training are often wooed 
away by high-paying private firms. 
 
GOLDBERG