Thorbjørn Berntsen, Beijing 6 November and Shanghai 9 November

Minister of the Environment Thorbjørn Berntsen
Beijing 6 November

Your excellencies, distinguished participants;

It is a pleasure to address this group of environmental experts from industry, government and the research communities of our two countries. We meet at a time of unique opportunities to consolidate and expand Chinese-Norwegian environmental cooperation. China' s impressive economic reforms, your serious approach to the country's huge environmental challenges and your strong commitment to international cooperation; all combine to make China a positive and promising partner for Norway in our global efforts to achieve sustainable development. For our part, we are realising that present environmental challenges increasingly move our concern and activities beyond national boundaries. This forms the rationale for recent significant increases in environmental support to Asian countries. The presence here today of leading representatives from all major sectors in Norway - government, business, industry and research communities - is evidence that China is moving very fast to the top of Norwegian priorities for international cooperation in the environmental field.

I. Sustaining or mortaging our common future?

As we meet today to discuss various practical means towards environmental improvement, it is against the backdrop of very serious pressures on our endangered earth. We are realising that nature is no longer inexhaustible. We always knew that there were clear limits for non-renewable resources like oil, coal and other fossil fuels. Now we recognise that there are limits even for our renewable resources. Over-use and pollution are threatening to exceed the regenerative capacity for our water, forests and topsoil. The ozone layer, our climate and many wildlife species are also increasingly at risk. In the last few decades, unsustainable production and consumption patterns in the North and expanding population and poverty in the South have combined to test and increasingly exceed the carrying capacity of nature and our critical life-supporting systems.

Nature is like a bank account: Do we live on our interest or on the capital? Are we sustaining or mortgaging the earth? To put it bluntly, our generation has lived off our natural capital for too long. Our capital has shrunk and we risk passing on a heavy mortgage and environmental debt burden to our children and future generations. With so many other pressing problems we often try to ignore or forget this. Our children and grandchildren won't. This is not fair to nature or to the millions of people who suffer today from severe pollution-related health problems and poverty, nor to future generations.

The good news, however, is that it is rapidly becoming clear to major segments of our societies that ignoring environmental threats is both shortsighted and naive. For individuals, companies and countries, being 'green' no longer means being 'lean' in terms of our quality of life, the profitability of our companies or our national Gross Domestic Product (GDP). Given the right incentives, policies and motivation to explore new paths of environmental cooperation, sustaining the earth can both make considerable profit and create new employment. Key guidelines for sustaining Our Common Future include:

• Moving from expensive 'react-and-cure' approaches to more effective 'anticipate-and-prevent' strategies.
• Moving from making nature or future generations pay to making POLLUTERS PAY and incorporating the real ecological costs of production in our pricing of goods and services.
• Moving from purely regulatory measures to expanded economic incentives for business and consumers.
• Moving from 'add-on' to 'build-in' technologies, from pollution abatement to more efficient and cleaner technologies.
• Moving from waste to eco-efficiency over the life cycle of products.

In sum, it is not the growth of a company or of the national or world economy that is at issue. Growth is needed at all levels. What is at issue is the kind and content of that growth and how we share it. Future growth, in China, Norway and in other parts of the world, must be more equitable, less polluting and more efficient in the use of energy and natural resources.

II. Sustaining China's future

Few if any other places in the world can match the magnitude of impressions facing new visitors to China. For me, who first came to China as a parlimentarian in 1988, arriving here for an exciting week of environmental dialogue and negotiation, China gives me a combined feeling of respect, concern, commitment and optimism:

1. First of all, for an Environmental Minister of a country of only 4 million people, approaching China of 1995 gives one a feeling of deep respect - for the fundamental environment and development challenges you face, as well as the serious manner in which you face them. With only 7% of global arable land, and with water resources per capita at only 25% of the world's average, housing and feeding 1.2 billion people is a tremendous task - with dimensions stretching the imagination. The same goes for the impressive economic development record since reforms were launched 15 years ago, and the fact that you since then have managed to lift several hundred million people out of poverty. These are formidable achievements for which China deserves global recognition.

2. Second, arriving in China this week also serves to underline reasons for grave concern about the environmental situation and the environmental costs of rapid economic development. From reading NEPA's 1994 annual environmental report, it is clear that the environmental pressures in many areas are reaching intolerable levels. Increasing discharges of pollutants into air, water and riverways create serious health problems at levels that have already led to substantial welfare losses - in environmental as well as human and economic terms. The precious water and soil resources are beeing depleted at an alarming rate, leading to significant reduction in groundwater level and degradation of ecosystems and farmland. Environmental pressures also increasingly stretch beyond China's borders, contributing to acid rain, ozone depletion and global warming. Although per capita emissions are still very low, there is no way to ignore that China, in the process of becoming a major world economic power, is also becoming a significant contributor to global environmental problems.

3. The good news in this situation, however, is the very serious commitment to environmental improvement displayed in my first encounters with Chinese policy-makers and industry representatives. Over the last couple of years, I have had the pleasure to meet with the heads of your environmental governance institutions. For me, this has started a learning process which I hope to significantly extend over the coming months and years. Already, though, I see many concrete signs of China's strong commitment to sustainable development:

• The recent establishment of the Environment and Resources Protection Committee in the National People's Congress, which, under the leadership of the distinguished Qe Geping, is set to become a key advocate of environmental reform right at the very core of China's political system.
• The dynamic development in China's environmental legislation; spearheaded by the committee just mentioned and providing extremely important policy signals to national and international companies aiming to invest in China's environmental future.
• The comprehensive and continuously growing network of thousands of environmental protection bureaus; at central, provincial, municipal and local levels.
• The development, over the recent years, of network organisations aiming to catalyse the efforts of domestic as well as international environmental technology companies; like China's Association of Environmental Protection Industries (CAEPI), the China Association for Chemical Pollution Prevention and Control Technology and the China Association of Machinery Industries for Environmental Protection (CAMIE).
• The launching of new and creative 'no-pollution' economic development zones in urban areas, as well as rural 'ecological villages' where sustainable development and anti-pollution measures are key conditions for economic activities. The environmental Technology Park in Yichang, Hubei province, is an interesting precedent in this respect.

4. The genuine commitment and openness with which China approaches the international environmental community, gives me a strong sense of optimism concerning the prospects for Chinese-Norwegian environmental cooperation. Too often, international environmental cooperation consists of nice words that are seldom put into effect. Gathered here today, however, I can see an audience committed to immediate action. The last couple of years have witnessed an explosion in Norwegian interest in China's environmental market. Before delving into some of the specific areas of joint activities, I would like to point to several recent developments that together have served to convince me that China is serious in its commitment to environmental cooperation with countries like Norway:

• China's leadership in terms of moving Agenda 21 and related UNCED follow up activities to the core of key economic and political processes - command global recognition and setting an important precedent for other countries.
• The launching 5 years ago of the China Council for Interational Cooperation on Environment and Development (CCICED), which forms a unique meeting place for Chinese and foreign policy-makers and environmental experts. Norway is very glad to be able to join the China Council as it enters into its second 5 year term.
• The environmental framework agreements that have been signed with more than 10 foreign governments. I am very pleased to bring with me home from this trip a signed environmental agreement between China's National Environmental Protection Agency (NEPA) and the Norwegian Ministry of Environment. This is bound to be an excellent framework for what I see as a continuously growing area of cooperation between our two countries.
• Finally, to many within this audience the most important evidence of Chinese commitment to environmental cooperation, is the continuation of the economic and institutional reform process. Already, China has made significant steps towards opening its market to international investment in infrastructure, industry and environmental technology. Even if there is still scope for improvement in overall investment climate, I feel assured that developments are on the right track. We also believe that a rapid process towards including China in the World Trade Organisation (WTO) will further stimulate Chinese-Norwegian commercial exchanges in the environmental area.

III. Areas of cooperation

The extensive list of speakers at this seminar will provide you with targeted inputs on a wide range of potential cooperative ventures. Before I give the floor to the technical experts, allow me to present some dimensions and principles that I would like to see forming the basis for future Chinese-Norwegian environmental cooperation:

1. Although governments are important in providing the overall regulatory framework and incentives for environmental investments, China's environmental future will not be sustained unless industry takes the lead. Recent years have seen many promising signs of industrial leadership in the environmental area. There is, however, reason to encourage business and industry in Norway and China alike to move more consistently from passive compliance to vigorous environmental leadership. We all still share a common and dangerous flaw: short time horizons. In a rapidly changing world economy, the losers will be those who don't realise that investing in a cleaner environment is already becoming a main characteristic and survival skill of successful companies.

2. Improved environmental management also requires that governments dare to move into new waters. Fundamental technological and economic change force us to be constantly on the move in search for new and more effective ways to stimulate environmental stewardship. In Norway, this has meant moving from a system of strict and sometimes too inflexible environmental regulations, towards an environmental management system designed to blend necessary norms and regulations with a range of economic incentive-based mechanisms. Crucial to this process has been close cooperation with industry, acknowledging the imperative of working with and not against the key economic actors of society. A promising new area of such cooperation is voluntary agreements between industry and government. We have already seen creative pilot scheme in this area. Major procers industry have declared their willingness to make environmental investments and reluted emissions reductions on a voluntary basis. I can already see the design and development of modern environmental management systems as a key field of cooperation between our two countries, implying the need for close interaction between industry, government and research communities.

3. However, the effective implementation of laws and regulations still calls for a strong and active government role in environmental policy. China's move towards a socialist market economy provides ample scope for environmental improvements, not least in making the prices of energy and natural resources reflect their real costs. Thus, in some aspects the market liberalisation process is clearly beneficial to the environment. On the other hand, our experience is that freer market forces can also create powerful incentives against environmental improvement - if governments are not there to design the right policy packages. What has become clear to my Ministry is that business and industry need clearcut, stable, long term policy signals, and credible enforcement mechanisms to ensure compliance. Our impression from discussions with Chinese environment officials is that the implementation of environmental laws and regulations is still lagging far behind official expectations. This is an area where Norway has gained much experience through failure as well as success, and where we look forward to work with our Chinese colleagues through various ways of institutional cooperation and exchanges.

4. The starting point and basic rationale for Chinese-Norwegian environmental cooperation is the pressing environmental challenges at the local, regional and national level within China. The overall aim is to relieve the situation for those suffering from severe pollution and environmental degradation, and in so doing make a small but tangible contribution to China's sustainable development. This is also why most of the experts addressing you later today will focus squarely on local pollution issues.

5. Still, the close relation between local and global environmental problems provides a significant potential for win-win options - where efforts to curb local pollution and tackle global challenges are mutually reinforcing. As I am sure you understand, the deep concern about global environmental risks is a key explanation why the Norwegian people supports our active international profile on these issues, including the Chinese-Norwegian environmental cooperation. Let me therefore, before concluding, point towards a couple of such areas where we see promising scope for our cooperation:

• As a major net receiver of acid deposition, Norway has long been active in efforts to curb acid rain in Europe. This has provided us with a strong interdisciplinary force of researchers and policy-makers. Knowing that acid deposition is a rapidly growing concern in China as well as in many neighbouring countries, our Norwegian experts are ready to form alliances with your highly qualified teams of environmental scientists. I know that many useful contacts have already been made, and that plans are in the pipeline for significant extension of such cooperation. The World Bank-initiated Rains Asia project is a promising umbrella for many of these activities, and receives substantial funding from the Norwegian government.
• Norway has also been an active proponent of cost-effective international approaches to mitigate global warming. This is why we consider the current pilot phase for Activities Implemented Jointly (AIJ) under the Climate Convention as an essential part of our climate strategy. Therefore, we are very glad that preparations are underway for a Chinese-Norwegian AIJ workshop early next year. This will hopefully lay the foundation for an active cooperation between our two countries on what is likely to be the most serious environmental challenge facing our planet.

Before giving the floor to the next speaker, allow me to congratulate your National Environmental Protection Agency (NEPA) on the very rapid implementation of a project that stresses very clearly the close links between local and global environmental action: the translation of Green Globe Yearbook (GGY) 1995 into Chinese. As mentioned by Prime Minister Gro Harlem Brundtland, we strongly believe in the value of information on international environmental cooperation to be available in Chinese.

Thank you for your attention.