 Good afternoon everybody and thank you very much for joining us for this afternoon's session on China's resource appetite My name is Nicholas Davis I am a director here at the World Economic Forum and as you may know the forum has worked Very hard over the past few years to look at the interconnections between resource issues and environmental around the world and as we know China being such an important player Economically politically in the world. I think it's it's fitting that here in esteemed company We have the opportunity to explore the issue of those links within the Chinese context If anyone is interested in discussing this more and the forum's work Please don't hesitate to come and grab me after the session But in the meantime, I leave it in the very capable hands of VJ to take us through what will no doubt be an exciting and informative session Thank You VJ Thank you so much Nicholas Good morning or a good afternoon at this point ladies and gentlemen. I'm VJ Vitis Warren I'm the China business and finance editor for the Economist and author of a new book on global innovation called need speed and greed and particularly excited not only because it Dells quite a lot into the question of the resource nexus the food energy water nexus as the World Economic Forum has called it But because the Chinese edition is going to be launched very soon So that makes me happy I hope you'll have a chance to pick it up and challenge me on the ideas within that book I would be well. I would welcome your comments to learn what you think about resources and innovation Without further ado Let me delve right into the topic of today Chinese Resource appetite or China's resource appetite Why are we here to talk about this? You know the mega trends of the 21st century the world faces Extraordinary challenges some grand global challenges. If you look at Beyond the short-term concerns of the last decade that have tended to preoccupy the world's governments And when those are important concerns things like terrorism post September 11th Things like the global financial crisis post Enron and post Lehman brothers and what to do about the euro These are important concerns, of course But they're not novel if we look back a thousand years political terrorism has been with us It's not a new phenomenon and equally capitalism in crisis I challenge you to tell me a time when capitalism wasn't in crisis We can go back to the tulip bubbles or the South Sea manias of your right So these are new to every generation, but they're not new in the way for example the resources challenge Confronted by climate change where we may have irreversible triggers In that environmental problem that would make it impossible to revert to a state For which life is habitable for humanity the earth will do fine, but the species on it like us may not And so there are certain kinds of challenges We now face because of the change the wave of demography That is transforming the world the Geographic changes the economic change with the rise of China India bricks and soon the civets economies and behind them an acronym That hasn't been coined yet. There'll be many more We're living at an extraordinary age an inflection point in many ways And at the heart of this the crucible of that change and tension is China and Resources lie right at the heart of that there are a lot of myths a lot of exaggerations But also they're genuine concerns and problems that we have to work through in a thoughtful way and to help us do that We have an extraordinary panel who I will introduce Indu course a couple of the ground rules for today. We want this to be a very participative panel. So there'll be no speeches I'm very pleased to say that our Good gurus our politicians and our company chairman and academic experts have promised no speeches from the from the stage And I'm going to keep them to that but equally I want all of you involved. So I'll turn to the audience quickly In the process for your questions make them good make them provocative Make us earn the microphone here on stage, but equally no speeches from the floor either, right? Nobody likes a gas bag. So let's let's keep this a high-level debate the way that the world economic forum events should be that's what I ask of you and We thought it would be interesting and fun to start with a vote And now all of you will find voting devices on your chair If you don't find one wave your arms and somebody will come around and give you one or grab one from the next chair And the way this is going to work We're going to ask you two questions right now. You'll see the screen will display them in just a moment We'll answer them and this is a forced choice No choice to abstain or sit on you know sit on the fence There's a saying in American politics don't be a mug wump with your mug on one side of the fence and your wump on the other think my Friend from Connecticut. I'm actually a from the state of Connecticut where Governor Malloy's from may appreciate that old axiom So please go ahead and vote the first question. Do you believe China's high economic growth rates in the past? Have come at an unacceptably high environmental cost again. We're starting by looking to how we got here in the past Please go ahead and vote Now I'm not getting any indicator of staff that people have voted The voting is done. Okay, great. So they've gotten your votes. Let's go to the next slide, please Do you believe that China's current policies will sustain high rates of economic growth that are compatible with Sustainability and environmental protection. So we're looking at how where we are today Just to be clear how we got here was the first question where we are now is the second question Okay, great. We've got your votes. Thank you very much We're not going to tell you what the answers are. We're going to keep it a secret Until the end and we'll look at them together to see how opinion has changed. Okay, I thought we'd have a bit of fun with this Great. Okay. So without further ado, let me turn to my first speaker We're gonna have I think Dr. Lin Bo Xiang director of the China Center for Energy Economics and Research at Xiamen University and a great expert on energy here in China Let me ask you just to lead us off here Can you talk about whether the relationship between Government and the private sector Is working in terms of resource management. I know you've done a lot of work on this How do you see that tension and what do you think we should do better? Okay? To answer this question is actually not easy. Just in fact that the two questions just opposed Moments ago to answer those two questions also not so difficult not so easy. It depends on how you look at from different angles So, uh, let me make it brief I believe that the the partnership between the public and private sector are extremely important in managing resources We all know that given the China's population base of 1.4 billion The order resources and curtain per capita is very low all the resources in China is going to be scared There's no question about it. We don't know you hear them in the back. Is there any problem? Okay? Yeah, a little bit higher. Okay. Okay. We don't have enough. That's for sure But moving forward how we can deal with issue That's where the public and private partnership coming in I think the government so really created in a boring environment to measure that the private sector Participation in the in the management of the resources By saying that is that I don't want the governments to step in the pub private sectors of shoes Like intervene in the market like provide the excessive subsidy that kind of stuff Because we all know that the resource has been heavily subsidized by the government or by next generation I Put in perspective that the government should are really Kicking the reforms in terms of energy in terms of resource pricing also I try to design a better subsidy system that such if we don't have over subsidized and do that Too much damage to the next generation the private sectors will be the main driving force for technology innovation and management system such a kind of Effective model in medicine and the resources so if I'm hearing you correctly When you talk about public-private partnership When I heard that you know This is something you were wanted to talk about slightly my heart sank because I think we've all been to discussions around the world on Public-private partnerships where that's an excuse for not doing very much for having talk shops But you actually not only have something to say you have something quite radical to propose When you say public-private partnership You're actually talking about The state retreating and the market advancing if I may use a local phrase. That's what I'm hearing. Is that fair to say that's correct Okay, so here we go a bold opening comment From a leading energy expert will be sure to pick up on this theme as we go forward But I'm very pleased that you I have a strong lead-off hitter hitter here Let me move next to Peggy Liu Chairman of juice which is an NGO that has some very innovative things going on that Peggy will Probably touch upon but it stands for joint u.s. China collaboration on clean energy And also she's a young global leader. So Peggy and I touched on this in just the opening comments, but urbanization China is maybe two three years behind the global trend to becoming an urbanized society China maybe a few months ago on official statistics became an urban society for its first time in history But on every other metric it's going to outpace the global pace This is going to be an extraordinary Continuation of an extraordinary migration of the kind that hasn't been seen in human history Can you give us your perspective on whether this is happening as a leapfrog? That has been posited like happened with mobile phones in Africa and so on towards a sustainable resource accommodating new kind of infrastructure of urbanization or is it mostly Replicating some of the unsustainable exerbin sprawl models that have seen in in developed countries elsewhere Where do you come out on this? So just to give you some context China's in the middle of a 40-year period of urbanization We're about 22 years into it and during these next 20 years. You can expect that we're going to build 50,000 new skyscrapers I think the economist said we're building the equivalent of a Rome every two weeks You can see a hundred news airports a hundred seventy new mass transit systems just a lot of fixed asset investment and So it's really imperative that China leaps frogs to build sustainable cities juice as an organization has been training government officials central level and local government officials through party training schools on how to build sustainable cities different modules from energy master planning to transportation to eco heritage tourism water and waste Treatment etc. And what we found is is that China has something very unique a couple things that are very unique going on one Is that it's piloting new technologies? Across multiple cities so any technology you can name electric vehicles LED street lighting Carbon trading emissions schemes etc. China's central government is basically designating anywhere from six to thirty of these cities To pilot them It's almost like they're throwing spaghetti on the wall and doing experimentation at mass scale if any one of these models Becomes viable then they can easily scale that across the country. No other Country in the world can do this type of experimentation I think that China is inventing the urban future and it's doing it by embracing international best practices international technologies And it's incorporating it into the way that China can develop China can digest it the second one is this this training mechanism is very unique I've never run into anything like it anywhere around the world so the central organization department has eight training academies and Every government official of a certain level or above has to take 12 days of training every year at least and they Choose the courses that they take so the court the students that Learned with us want to learn about sustainable cities So this is an amazing mechanism to take best practices and scale them very very quickly in a very in-depth way to explore solutions In a way that they can then implement them locally so central targets That exist numerical miracle targets for energy efficiency water pollution reduction Reforestation and all these things all these great things can then be implemented by these local leaders And so China has some very unique advantages I'm very hopeful that this China is inventing the urban future in a way that will leap frog Peggy, you've given us a very different picture from our first speaker You're you've talked about the dynamism of the government structure and especially of local government structure And you've given us a picture of a system that is got the capacity to run lots of pilots To see what works that has a tolerance for risk and that ultimately You say has the ability to scale what works and those of you who are from a venture capital background or who follow innovation Studies know that that's a lot of the characteristics of what defines Innovative companies or innovative ecosystems these components, but you're talking about a centralized government, right? So I just want to reality check here And and maybe push you a little bit this is the theory we all know about the pilots But the essence of this the proof is in the pudding give us a couple of examples of when pilots Happened failures were allowed to fail and the success is by you know independent measures Successes were actually brought to China scale in the sustainability space And then we're not interfered with by the usual problems of elite capture Government subsidies we all know some of the the challenges involved with government acting like a market actor Well, let me start with failure because that's a good place to start I think coal to liquids has been one of the failures In terms of not being commercially viable, but they've put in hundreds of billions of dollars into that however smart grid I think is an example of success. So, you know, they what's what's happened for those of us that don't know in the audience What's actually happened with smart grid? So five years ago juice as an organization led a coalition of international experts to work with decision-makers namely the state grid to See how smart grid could benefit the electrical grid here in China and in 2009 They announced a roadmap to implement smart grid across the country by 2020 and they Put 7.2. I think billion dollars behind that and now I think that's probably doubled and there's a lot of private Market investment behind that as well, and I think there was at least 15 Local city pilots that were told to figure out how to deploy smart grid So, you know again spaghetti on the wall. We'll see where that goes, you know, we're not yet at 2020 But I think a lot of international experts believe like Duke Energy applied solar They believe that smart grid will be implemented here in a comprehensive comprehensive way first Compared to the rest of it's still an aspiration just to be precise Yeah, anything we haven't got anything with large-scale capital will take you know, 10 20 years to actually Okay, I just want to calibrate expectations So you put forward a theory it's a train in motion, but the train hasn't yet gotten to this destination There is skepticism anybody who wants to see the tinging eco city the Sino Sorry, Sino Singapore eco city sign up with me. We're leading a tour Thursday A VIP tour I'd be happy to include you so you can see it for yourself. Okay, so we've had two different visions Of what's happening and now often in China multiple things are happening at the same time I think that's also one of the characteristics of Understanding China, but let's let's go from what we've just heard which is a An insight into how Enlightened leadership can can push from the top down I we're gonna hear from Ma Jun who's the director of the Institute of Public and Environmental Affairs here in China I know you've done a lot of work on Data transparency as it relates to the environmental space and And can you talk a little bit about that and in particular how they can empower from the bottom up? Thank you VG. I think throughout the world Management should start it with measuring so data is very important for government for the corporate Word and also for the for the public But it's particularly important in China in terms of environmental governance Because so far, you know when we look at China's dire environmental situation We come to the conclusion that the first the number one barrier is not just a lack of technology or money It's the lack of motivation motivation should come from the government Enforcement, but enforcement remains to be very weak and the environmental litigation is near to impossible Behind that it's the protection given by the local government to some of the polluting factories that they want Want to have growth so we need to we need to have Create more motivation We need to have the broad stakeholders to join the efforts But people need to be informed before they can get involved without in mind We created then a national pollution database in 2006 and over the past six years have compiled All this government source the information and provided make it easy at more accessible and with this You know when people access this information now it has put extra pressure on those companies It's raised the violation cost and so far it has motivated hundreds of polluting factories on our on our list to come today to the to the NGOs to make public Disclosure about what went wrong how they try to fix their problem and go through the third part audit to try to prove to the public So it generates some real change So this is very exciting and then there's also I think I mean that one of the oldest adages in business is What matters gets measured and the corollary to that is what's measured gets managed And it I've always it struck me. I wrote about energy in environment for many many years for my magazine How little was well managed in terms of environment and sustainability? or until recently in Among companies among countries and national accounts environmental data are often very dubious is often huge holes And so, you know, I applaud this effort But how far can you go in China? How these are public data, but you're working on public registries as it were Is there the experience from other markets other countries for example the toxic release inventory the TRI data in the US or Where you have 10 15 years of having public data actually lead to environmental change Shows that it's not just the publication of that data. It's what sense you make of it Are people able to act on it? How what is the quality of that data? Can you talk a little bit about some of the challenges you give us the positive case? Tell us about what needs to happen to make it better Yeah, the challenges is obviously here China has been ruled top-down for thousands of years So transparency and public participation is not something that we can easily adapt to but but this country is going through this transformation When it modernized itself, so I see that that that this is part of the important social change social progress made in China and But we understand the constraints So from the very beginning we made a huge compromise to start by using the government source the data only but of course, you know, it helps us when all this Polluting factories and even the local government Lobby by them to come to pressure us to You know, it helps because it we can all provide a sources other sources there a government sources there But I know that this is not enough. We need to move forward and fortunately I think since 2003 China is is moving toward this trajectory and it culminated it in the year 2008 when this this Government have published the open the China's first to go open government information regulation So on the environment side we have the environmental information disclosure measures All this provided the basic legal framework for that for us to operate So we want to collaborate with the stakeholder including the government to move it forward Great. Well, I'm sure we'll talk a little bit more about this and maybe even talk about the role of social networks and citizen power where Chinese on a number of occasions have gotten together spontaneously to block Polluting plants for example and Dalian and elsewhere, but let's let's move to our next speaker Daniel Malloy who's the governor of Connecticut, of course like China the United States is a Great nation with great challenges when it comes to energy resources environmental conservation But the state of Connecticut I'm very happy to say is a leader in energy environment policy. Give us your perspective What have you perhaps learned and can share with us? Well, I want to begin by saying that Connecticut is an energy constrained state with relatively high cost of energy With pollution generated in other states primarily by the burning of coal. So there are similarities as well What we're trying to do is concentrate on ultimately on cheaper cleaner and more reliable energy And to get to that by a portfolio approach where where price has to be built in to decision making I also come at this from from a different position and I'll mention this I think it's ultimately imperative that the United States North America be energy independent I also think it for national security reasons for national For international competition reasons China ultimately has to be and I'm not talking about in the next 150 years but in a relatively short period of time needs to strive to clean Clean its environment needs to strive to access the energy that that it needs for production and life Purposes, but ultimately must also become energy Independent otherwise the two greatest economies in the world are destined for conflict over issues Which quite frankly if we set our mind to it are avoid avoidable at this point In Connecticut, we'll get our portion of the job done. We're a relatively small footprint state We'll in the next three weeks publish an energy plan that will be a roadmap for moving Connecticut to cheaper cleaner more reliable energy, but we're only a little tiny footprint in the in the world We have things to say about what gets done elsewhere Let me pick up on a piece. You mentioned in passing prices. It's a high energy cost state But equally the role that prices and price signals can play in policies Can you talk a little bit about how you think about externalities in Connecticut and whether there are market mechanisms that can be Introduced that you're thinking about, you know, some of the best news in North America and some of the most disruptive news in North America is Shell gas the finding of gas and the implications that that will have on the development of technologies And what fuels get used in the short run in the long run? It is abundantly clear that with Canadian oil and Mexican oil and increased oil production in the United States along with shale gas along with the Fairly rapid development of hydroelectric in Canada North America can in a relatively short period of time be energy and independent It appears You know, we'll have to watch the vagaries of pricing in natural gas that that can be done For the United States for North America at a relatively low cost And and that's the that is one of disruptive factors It's obviously very encouraging for us in manufacturing and other high-energy consumption fields and and will allow us to be more competitive than we have been in the past But it on an international basis. It could be very disruptive, right? Very interesting. We're gonna pick up on that Let me turn to our final speaker Wong Wen Biao chairman of the board of Eli and resources group And I believe you'll be speaking in put on fun from that mistaken So perhaps people may want to put on their headsets if necessary Can you tell it you're a Business leader in the green economy. Can you tell us what you see here? We're talking about China's resources What do you see as the green economy and how do you see from a business perspective? Making this a bigger part of the solution Well, green economy is very important to China and to the world is also great challenge I think we should look at the green economy from two perspectives first Quant qualitative innovation and also qualitative In China and in the world we should talk about one thing How do we develop the economy which also protects the environment? This is a win-win situation for China for the United States and for many other countries We should think about this Solution through what mechanism can we realize your situation? We want environment But many environmental initiatives are Public service, but we also need to develop economy economy is about business Let me talk a little bit more about how My company is doing in this aspect. How do we develop our business? But also protect the environment just give us one quick example because we promised no speeches One example of what you're doing My company This is a desert and Within 24 years to make over 5,000 So this is an environmental initiative 5,000 square meter is a big area And on these places we also developed our business We developed our business without polluting the environment This is a very emerging business for example new material, a new agriculture New energy etc With the U.S. standard or evaluation We are actually Conserving the natural resource and in this way we develop our business and economy. This is our model So I think this should be a good model which can be adopted But we need multi stakeholders to participate and to benefit more people The general public should participate for example when we manage the desert About 100,000 people help us to grow trees to manage the trees This people can benefit and secondly When we develop our business and economy We created many green jobs all together We created about 100,000 jobs This is the second benefit and a third policy The government is very happy because I actually created a Oasis for him For example Tianjin in the past The sandstorm for Tianjin and for Beijing is from that desert area This is a very big desert Maybe Chinese people don't even know this But now Tianjin and Beijing do not have that many sandstorms So there is a concrete example where you found some success You talked about actually the individuals who are involved And I think that's one of the themes that's emerging for me I want to turn to our speakers more broadly on the panel Maybe Peggy we can turn to you The engagement of the individual We've heard the role of business The partnership between business and government The role of market forces I want to hear from you about what kind of China Are we going to have going forward And what role can individuals play in shaping that Given that we have the world's largest middle class and growing The aspirations as everywhere else in the world For the creature comforts of life That are enjoyed in the West How do we achieve the understandable desire for prosperity A better life, material goods In a way that is compatible with the realities of resource constraints So first to set the context There's a couple of challenges that we're facing in China The major levers of resource appetite in China Are being driven by the grid Power generation, by urbanization Sorry, industry Then urbanization, then consumption And if you think about those four The grid is the easiest to affect because there's only two players Two major players And then five power generators There's the industry which is easier to control Because we've got for example a 10,000 state-owned enterprise Energy efficiency program that we're working on And there's a smaller set of players Urbanization is harder because there's so many cities There's so many players in different nexus issues That come together in a city But the holy grail is consumption How do you influence the consumer? And in China we have today 300 million middle class But it's going to be growing to 800 million middle class by 2025 In fact the Asian consumer is going to be the biggest market For consumers in the future And China is going to be the largest segment of that So each one of us then go out and live Like an American or European conspicuous consumption lifestyle We're not going to have enough resources for the planet So the question is how do we break How do we attack this holy grail? So juice, our nonprofit is working with companies Like Edelman in the audience Getting advice from APCO in the audience And other academics, advertising agencies, media, etc We're pulling together to do two things We're trying to reimagine prosperity We're trying to create a new national identity That is inherently Chinese Overlaid on top of modern realities But really sustainable at its heart So this sounds like you want to replace the American dream With something more homegrown The China dream Although in Chinese we call it He Yue Meng Xiang So harmonious happy dream But to do that, to change social norms We need to do two things We need to not only shape the desires And visualize it so we can easily follow it But we also need a set of policies That easily shape consumers at point of purchase And at product use So they're really two separate projects That we're doing at the same time Visualizing what does this Chinese dream look like In our communities Health and wellness, culture and style What does that look like so we can follow it But then also working with cities To pilot these policies over the next several years So welcome participation I want to give early warning to the audience I'm going to come to you soon So please start gathering your thoughts For good questions But let me turn perhaps to Lin Boqiang What do you make of the comments you've just heard And I welcome follow on comments from my other panelists Of this idea of a new China dream And one in which incentives are provided To individuals, consumers to behave differently What is your vision of the state doing less And more room for the market fit into this Are they at odds or is there some compatibility I think that consumers are going to play A very important role in the resource management And the reason I'm saying that is that Particularly in developing countries It's very difficult for consumers To really pay for the real cost of resources And that's one issue that I think That we have trouble all the time Each time when they have an adjustment And the electricity tariffs Or we finally report that So they are always outcry from the public So this is what economists like to call externalities Right The true cost of resources is often not paid At the point of purchase So therefore the education of consumers Are quite important One is that we have to educate consumers To let them at least understand the true cost Of the resources Why is it quite difficult to define the true cost But at least we can try our best To tell consumers that if you have been subsidizer You have to understand that you have been subsidizer That's one Secondly, by educating consumers In understanding the cost that we should be able To let consumers more willing to pay for resources And more willing to conserve the energy Or other resources What is the role of externalities' taxes Or specific policies? Can you point to one or two that China needs to do more Or where you see international success Or can this be achieved, for example Through labeling requirements So that a packet of potato chips Or a bar of soap that I buy And if there's two choices Company X and Company Y One is incredibly resource intensive The other one maybe much lighter footprint I might choose as a consumer to buy the one That is more eco-friendly Just by having the information Does that work? I'm not quite sure that it's that close to China In terms of labeling In terms of educating consumers I truly believe that many other areas That the government can start with For example, the resource tax Right now we only apply resource tax To the oil and gas And with a very low percentage Right now 95% compared to international standards Extremely low And we also try to avoid taxing For example, the energy Which is the main source of energy for China Like coal Right now coal is still almost No resource tax attached to it Very little So moving forward I think that I truly believe that The government can do something A lot of reforms To ensure that the resource in China Reflects the externality So that environmental extendity And also what is going to happen In terms of the scale of resources Impact on the future generation So labeling to educated consumer Right now I think it's A deep follow-way as compared To educated consumer to understand the cause And we need to pay for it All right Very clear argument there Do I have any questions from the floor? I see a hand up right away in the back Let's go to that gentleman Just a couple of ground rules Please identify yourself, of course And please make it a short and sweet question Again, no speeches, please I know how strict you are, Vijay This question isn't as pessimistic As it sounds maybe for Peggy, but anyone Can one of you give me a sense Of the proportionality of this? I mean, I get the feeling That a lot of good things being tried But it feels like almost Messing with the deck chairs on the Titanic Given the enormity of those 300 to 800 million Middle-class people The enormity of energy demands How do you see anything 10, 20 years from now Really meaningfully eating away At this huge challenge? I think that, you know, So again there's four buckets, right So smart grid, the electrical grid I think that that is the backbone Of a lot of the stuff that we're talking about I think that what China is doing That is not messing with deck chairs It's transformative Industry, I think if you look at The 12-5-year plan and some of the cooperation They're doing with Lawrence Berkeley National Lab On the industry energy efficiency That's not messing with deck chairs The 372 billion dollars that they just put in Over the next three and a half years On energy efficiency and reduction Of pollution investment I think that's not messing with deck chairs Urbanization, they just put 126 billion dollars into more Subways, subway development So we're going to have a little bit more than Four times the amount of subway lines That we do now in 2020 So 7,000 kilometers in 40 different cities Not messing with deck chairs But consumption is a little bit harder The only example that it can give Is the banning of the free plastic bags In 2008, the exact numbers Might be a little bit off, but I think In the first two years They reduced the number of Thin plastic bags used in grocery stores By over 20 billion I think it was 24 billion or something like that So small nudges, huge skill impact Marjun, a follow-on comment? Yeah, follow-up I think Peggy talks about The China dream and I agree with that But when our people watch The rising middle class watch the Hollywood Movies, they do want American dream The big suburban house and big cars So we do see another trend But in the meantime, there are such Many surveys found that the Chinese consumers Have the strongest desire to go green The reason is quite clear We have hundreds of millions of people Exposed to badly polluted air Water, drinkable water It's about the food 12 million tons of food products Contaminated by heavy metals each year This is about the health of themselves And their children So there's such a strong desire But we need to, as Professor Lin said We need to give them the information We need to educate the consumers We need to give them the choice Without in mind a whole group of 21 NGOs Form the Green Choice Alliance In the year 2007 We asked the consumers to pay attention To the pollution discharge During the manufacturing process Of course we understand It's still hard to mobilize hundreds Millions of consumers at this moment So we decided the first step Is go toward the big brands Because the brands are sourcing In a massive way in China Not for their production For their selling in China But also for the selling in the whole western world If they can change They can mobilize hundreds Or sometimes tens of thousands Of their suppliers to change At this moment This Green Choice Alliance Have been expanded to 42 NGOs Now several, it has been engaging With more than 50 major global brands To try to, many of them started Like Walmart Every month Walmart will compare Its list of suppliers More than 10,000 of them With our list of violators The list, our list is 100,000 So they compare the two lists When they identify problems They will call them saying that You've got to change Otherwise your order Will stuck in the computer So that motivates more than 100 Of their suppliers to change behavior At this moment So I think we need to broaden We need to expand that initiative The work you're doing with supply changes Is absolutely fascinating I think that's a lot of how the Guts of business actually changes So I'm sure we'll all like to hear more later Let me add one more point to follow up On this question I think that we have to look at Distinguish what looks good And what does not look good But acts a large impact While all the small group All the distributional energies All the wind power and solace They look real good But in reality How much impact On China's resources at this point If somehow we can manage to Educate consumers More understanding the cost More willing to pay Such we can adjust the resource tax Upward We can adjust the resource price Upward Then the impact During this development stage Will be far more huge Then what we are Keep talking about those clean energies If you look at those they are very small So you're clearly a big believer In the power of incentives Precisely Broken as a true economist If you look at the wind power Wind and solace less than 2% In China And has been tremendous growth Still less than 2% The coal provides 80% electricity 69% of the primary energy If somehow we can manage To get a little bit excess demand Out of coal Then we achieve almost A lot more achievement Than compared to those The good But what we are doing To ask people to pay for the coal To pay a high price for coal It's difficult It doesn't look good But it has an impact We have a question here from the front row And then we'll go to the lady in the back next Please a short question Yes, my name is Li Lei I'm with Saabik One of the biggest petrochemical company 70% owned by Saudi government The question is about construction And automotive Because among many other sectors We supply major materials To this particular two sectors We talk about that The China-American dream To have villas That doesn't work So it seems to me The majority of the Chinese consumers Are comfortable with high-rise Building condos That's fine But every household is obsessed To have a car Or two cars Or more cars So your question is When is it enough What the government's role to play To curb these frenzy demands Who wants to pick this up? Let me ask you this very briefly I think that we got a problem In fact, we don't need that much Actually We are fairly designed in a system Such that resources are not sustainable We have market economy If you ask a company What's the most important? It's to share, right? And if a human desire Is almost unlimited It manages to force together It points to a direction Which resources are not sustainable by itself So what we need to do Is how we're going to break These two forces When they meet each other Such that we create a huge demand We have something we don't need For example, two cars One car is not So putting all those together I truly believe that the government Intensive resources management Really need to have a system approaching And what I'm trying to say is That we need to balance the cost Security and security Surprise and also the sustainability Have to be balanced And by doing this We need to have a good planning And a transition A slow transition from one to the other For example, the solar power We have a huge incremental In the last few years And now the whole system Is almost collapsed Because the market's not there So we created a lot of voice But in the between But to the gentleman's question Everybody wants a car It's an aspiration Are you going to tell them no Will policy forbid it? Is that part of the answer in China? Probably not Can you use prices? Your favorite argument? That's why That's what's happening In the big cities, right? It costs almost $10,000 To get the permission to have a car In the big cities like Shanghai Or Beijing on an auction system And we'll get even more Singapore has used that to great effect So perhaps price signals But may I offer a thought That people's aspiration May be a car Because that's what we fixate on today But Henry Ford, the great industrialist Actually said I'm not going to ask my customer What they want They'll tell me they want a faster horse And he found a way To mass produce something better A car And I would put to the audience Just as a thought That what people really want is mobility And the car happens to represent that Based on current means of production And what's available But you could imagine Integrated transport systems You could imagine car sharing You could imagine other modes And high speed rail can play a role in that If you can meet people's aspirations For convenient mobility We may be able to get to other models Here in China That we haven't been able to do in the west Where we're burdened with legacy assets Legacy infrastructure But particularly legacy mindsets Now, there's a lady who's been very patient In the back And I see a few more hands And not enough time So let's get a microphone here I did promise her a question Is it still relevant, madam? Okay, great, please A short question You bet I live and work in Africa Which is helping Christine Pearson I live and work in Africa And China Which helps satisfy China's insatiable resource Appetite What is China's responsibility In terms of environmental policy Say, if it's drilling for oil in Angola Or diamonds in Zimbabwe Or coal in Zambia Or cutting timber in Liberia, for example Great question Somebody want to take this up? Yeah Thank you I think one of the reasons We now look at the western world Now the basic climate change Is a challenge But the local environmental problems Pollution problems got more or less Quite stable at that time And that plays I've been to Connecticut And their quality is said to be Not very the best in America But still, I see blue skies Almost every day But not, I mean, in China Not like in China It's one of the reasons Of course, there are many, many efforts Pollution control efforts But the other side of that Is the migrating Of all these polluting industries When I studied Yale And the last, I think Some iron steel smelters Got transported to China To rebuild here Just, you know, now China Is the workshop of the world And I think, can China Now China's trying to upgrade Our own industry And in the meantime Because we are the manufacturers So we need all this resources Not just to meet our own demand But also for re-export all this Process that Let me stop you You're describing what has happened But let's fast forward Just in the interest of time What do we do about it? As you say This is economic history It was ever thus We need to grain The global supply chain We cannot allow all this Polluting pollution to migrate From one place to another You know, China cannot follow The old way Like the western countries To go to other resources Is there a mechanism you can propose Or anything concrete? Because it seems to me The nature of the global economy I think the global economy Have, you know, the economy Have got globalized But not the environmental governance You know, our monitoring Has not gone globalized At this moment in America You have TRI in Europe You have PRTR You know, people can access All this information and monitor The performance of all this Discharger, emitters But not in China Now started in China I hope that now some of the Polluting factories Started to migrate to the ASEAN countries and to other places Now we need to globalize That monitoring system as well There's a possibility for that Thanks to the program I think for the Web staffers here There's a rich role for the Can I say a little bit? Sir, please go ahead Well, we have been talking About the environmental protection And its relationship with consumption Well, we've been talking about How to conserve energy, reduce Emission, how to protect the Environment in this way This is correct These are good proposals China is doing this The America is doing this The whole world is doing this Having said this We should jump out of the box We should have a new perspective Just now Mr. Ma mentioned The globalization of environmental management I agree with this proposal We have been talking about We have been negotiating Over the Kyoto protocol Let me give you a data This year Every year CO2 emission Around the world Is about 30 billion And we could only Solve 10% by conserving energy The remaining 90% Should be solved by Green trees, green land, et cetera So the data is there So we cannot solve The problem just through Our own effort But we have a room Now there are so big Desert around the world If one third of the desert Can be turned to the forest Green land Then the emission Or the emission every year Can be reduced dramatically For my company Now the green area Of my company is just one If we have 7000 companies Working on 7000 deserts Then we would not need To talk about climate change Of course we should Still talk about energy conservation But this problem is partly solved So this is a big problem Let's green more trees Let's get more green land Let's turn deserts into green areas You cannot change the ocean The only area we can work is the desert Thank you Both an inspirational tale From the bottom up Of what private sector can do But also I think points to a point That's sometimes forgotten And some of the discussions We tend to focus on the energy system Looking at the production of forms Of energy, sometimes distribution But a quarter or more of course Of climate change arises from land use And land use changes And so there is an important area to play Including from the private sector And thinking about that We have very little time But I will take a last question From the lady here In the third row If you can make a quick comment Sorry, but a quick question And a quick comment from our panel It's actually a quick feedback From the consumer side But it's going to be a question, right? More of a feedback But you can maybe talk on My name is Mara I'm from the China Entrepreneur Club But I give a feedback on terms From a perspective of the consumers I think as a consumer We think the role of government And business Especially the government Is not to tell us What life not to live But alternatively Is to provide a Prosperity On a low cost basis All consumers they want to live good But it's not up to the government To tell us what life not to take But it's our choices to leave Better on the innovation base That the business and government Are able to provide a better life On the base of low cost Of energy, thanks Okay, well thank you I will tut-tut you For not asking a question But I will turn it into a question In the following way By not following the ground rules there Peggy Liu And this might also be something That our governor may want to weigh in As a former mayor If I'm not mistaken And member of the council mayors You're really in a sense Poking at the nanny state The government or in this case Peggy Liu and her very worthy organization Telling you how to live your life What should a China dream be You're arguing a little bit From a bottom up perspective It should be individual choice Perhaps in the marketplace What do you answer that And again as a governor Who wants to lead people Down a sustainable path Can you both of us give us a quick word On this challenge that's being issued About the individual's supremacy I think that people in China Know what type of life they want to lead So it's just a matter of visualizing it One of the things that we're doing Is going across the country in workshops Being hosted by Sachin Sachi or Ogilvy Or Shanghai Tongji University Or museums in Beijing etc Saying what does the community look like We want access to clean public spaces That our babies and elderly can live in What does that look like What if we had skyscrapers Above ten stories or more Dedicate a whole floor to that What if we had our low income housing Be designed in a way that Shared families can share facilities What if we had more bike share What if we had access to sharing goods In our neighborhoods So Chinese people know what they want They just need help articulating it And visualizing it Which is why we're taking the best Of western storytellers And bringing them with the Chinese Experts to visualize it Then what we do is we release those seeds Into Chinese mass audience And let them make it come alive Through social media Through Sina Weiboa If you're interested in more Look at juice.org J-U-C-C-C-E.org Slash China Dream For our action plan But you need to have a dialogue Is it fair to say that this is A propaganda effort A benevolent propaganda With our best interest at heart But using the tools of fine Propagandas of the past Absolutely, I mean it's social engineering It is With best western advertising Storytelling techniques But the knowledge Deep knowledge of traditional values From Chinese people Got it. Governor, very briefly Give us your perspective I think government has a role to play In all of what we've just talked about And that is to actually make sure That the true cost of anything Is revealed And governments for a long time Have seen their role Particularly in emerging economies Have seen their role to mask True cost There is a social imperative That we drive in China Another 800 million people To middle class status What's the true cost of that? How does that cost spread? Does government hide the cost Or assume a portion of the cost Without disclosing it? If it does, then it's going to Encourage behaviors that are Going to be driven by more Consumption, not less And I've seen this in all economies Emerging and mature What is the role of government? I would argue that the role of government Is to make sure that everyone understands The true and absolute cost Of all of its policies Including a policy of pro-consumerism And of course a great example In the US, the markets Speaking up on the earlier point Made the markets and insurance Price parts of the United States Coast, for example the Gulf Coast As too expensive for flood insurance Or at much higher rates Government subsidizes flood insurance In many parts of the US As well as in other countries And encourages people to build In areas that are quite expensive So an example in the United States Just to make the point that I'm talking about Is packaging, packaging has changed Radically in the United States As a result of the decision made To expose its cost And all of a sudden we figured out That you could have a fraction Of the plastic holding water That we used to have hold water Okay, so two counterpoints To the question raised from the floor To that question We're coming right at the end of our session Let's see, having those two questions Put up on the screen again And having you vote The conversation has moved the needle at all So do you believe China's high Economic growth rates in the past Have come at an unacceptably high Environmental cost, please vote now Okay, so we're seeing more or less The same, the past hasn't changed Thankfully in the last hour Let's see what the assessment Of current policies is Let's have the second question Do you believe that China's current policies Will sustain high rates of economic growth That are compatible with sustainability And environmental protection, please vote And again, we did hear some disagreements On the panel about the role of government The role of markets, the role of top-down solutions Versus bottom-up empowerment And so let's see what people thought How many are more optimistic Than they were before, or vice versa Okay, so clearly the trend line Is clear, that we may have lost A few in the disagrees, but still A strong degree of skepticism remains In the room, so it looks like I think our experts here from business From the private sector, from government We have some work to do, and I think They would welcome you in joining them In rolling up your sleeves and helping them Build China's sustainable resource future Thank you all very much Please give them a round of applause