The Economics of Climate Change in China: Towards a Low Carbon Economy

Description

China faces many modernization challenges, but perhaps none is more pressing than that posed by climate change. China must find a new economic growth model that is simultaneously environmentally sustainable, can free it from its dependency on fossil fuels, and lift living standards for the majority of its population. But what does such a model look like? And how can China best make the transition from its present macro-economic structure to a low-carbon future? This ground-breaking economic study, led by the Stockholm Environment Institute and the Chinese Economists 50 Forum, brings together leading international thinkers in economics, climate change, and development, to tackle some of the most challenging issues relating to China's low-carbon development. This study maps out a deep carbon reduction scenario and analyzes economic policies that shift carbon use, and shows how China can take strong and decisive action to make deep reductions in carbon emission over the next forty years while maintaining high economic growth and minimizing adverse effects of a low-carbon transition. Moreover, these reductions can be achieved within the finite global carbon budget for greenhouse gas emissions, as determined by the hard constraints of climate science. The authors make the compelling case that a transition to a low-carbon economy is an essential part of China's development and modernization. Such a transformation would also present opportunities for China to improve its energy security and move its economy higher up the international value chain. They argue that even in these difficult economic times, climate change action may present more opportunities than costs. Such a transformation, for China and the rest of the world, will not be easy. But it is possible, necessary and worthwhile to pursue.

FAN Gang is Director of National Economics Research Institute, China Reform Foundation, professor at the Graduate School of Chinese Academy of Social Sciences (CASS), and member and vice secretary-general of Chinese Economists 50 Forum. He serves as an advisor to the Chinese government and as a consultant to a number of international organizations. He is the author of over 100 academic papers and eight books on macroeconomics and the economics of transition. Dr. Fan earned his Ph.D. in economics at the Graduate School of the Chinese Academy of Social Sciences. He also holds the directorship of the China Reform Foundation. Nicholas Stern, Lord Stern of Brentford, Kt, FBA is IG Patel Professor of Economics and Government at the London School of Economics, where he is also head of the India Observatory within LSE's Asia Research Centre, and Chairman of the Grantham Research Institute on Climate Change and the Environment. Previously, having held academic posts at the Universities of Oxford and Warwick and the LSE, he was Chief Economist for the European Bank for Reconstruction and Development and subsequently Chief Economist and Senior VP at the World Bank. In 2005, he was appointed by the UK government to conduct the influential Stern Review, which analysed the economic costs of climate change. Ottmar Edenhofer is professor of the Economics of Climate Change (appointment together with the Michael-Otto-Stiftung) at the Technical University Berlin and Co-Chair of the Working Group III of the Intergovernmental Panel on Climate Change IPCC which won the Nobel Peace Price in 2007. He is deputy-director and chief economist at the Potsdam Institute for Climate Impact Research (PIK) and is currently leading Research Domain III - Sustainable Solutions at PIK, which focuses on the research on the Economics of Atmospheric Stabilisation. XU Shanda graduated from the Automatic Control Department of the Tsinghua University in March 1970. He received an MA in Agricultural Economic Administration from the China Academy of Agricultural Sciences in 1984, and 1990 was awarded an MA in Public Finance from the University of Bath, UK. He also holds the title of Senior Economist and is qualified as a Certified Public Accountant. Xu has held a range of high-level roles with China's State Administration of Taxation and the Ministry of Finance, most recently as Vice Minister of the SAT. Klas Eklund is Senior Economist of SEB, one of the largest commercial banks in the Nordic region, and adjunct Professor of Economics at the University of Lund. He is a member of the Group of Economic Policy Advisers, set up by the European Commission. Previously, Mr Eklund has held many different posts, including Deputy Under-Secretary of State, Swedish Ministry of Finance, and policy adviser to the Prime Minister as well as Chairman of several government committees. He has published a number of books and articles, including the best-selling Swedish Economics textbook and a book on the economics of climate change. Frank Ackerman is the director of the Climate Economics Group at SEI's US Centre. He has written extensively about the economics of climate change and other environmental problems, and has directed policy reports for numerous national and international agencies. His most recent book is 'Can We Afford the Future? The Economics of a Warming World' (Zed Books, 2009). He is a founding member of Economists for Equity and Environment, and a member scholar of the Centre for Progressive Reform. Dr. Ackerman received his PhD in economics from Harvard University. Before joining SEI as Deputy Director and later on SEI Asia Centre Director, Dr Lailai Li was director of the Programme of Leadership for Environment and Development (LEAD) and the Institute for Environment and Development in Beijing (IED), a Chinese NGO which she founded in 1994. Over the last decade, she has been studying and generating solutions to poverty and environmental degradation in the field, through capacity building, information dissemination, program development and inducing institutional and policy changes. Since 2000, she has focused on research on Corporate Social Responsibility and promoting it amongst Chinese small and medium enterprises. Karl Hallding heads Stockholm Environment Institute's China Cluster and has extensive experience from international co-operation with China on environment and sustainable development since the mid 1980s. He was the main author of UNDP's China Human Development Report 2002 - Making Green Development a Choice and participated in the expert team behind the recent OECD Environmental Performance Review of China where he was responsible for drafting the chapter on Environmental - Social Interface.