Step Lightly: China's Ecological Impact on Southeast Asia

By
Jennifer L. Turner and Ada Wu

Unlike the Tonlé Sap Lake and the iconic Mekong River, which are globally recognized as biodiversity hotspots, the Cardamom Mountain Range is not well known outside of Cambodia. Nonetheless, this ecosystem contains extensive intact areas of lowland evergreen forest and is also home to over 40 globally threatened species. Moreover, rare relics of early Cambodian culture are scattered throughout the area, such as cave paintings and jars containing human bones of ancient Cambodians.[1] Yet some of these culturally and bio-ecologically diverse hotspots of the Cardamom Mountain Range are now in danger of being inundated by a cascade of dams that the Cambodian government is planning to construct in the range with the help of Chinese hydropower companies.

According to a field report issued by Conservation International in 2007, at least four of these dams are near or within the Central Cardamom Protected Forest, with the proposed Stung Chay Areng Dam on the Chay Areng River posing the largest threat to this biodiverse ecosystem and surrounding indigenous communities.[2] The dam’s reservoir would flood nine villages with a combined population of 1,500. The reservoir would also extend into protected forests, inundating the habitat of 31 endangered animal species, including the world’s most important breeding site for the endangered Siamese Crocodile.[3]

Dam building is only one of the ecosystem threats to the Cardamom Mountain landscape coming from Cambodia’s rapid post-conflict development; others include road construction, intensive agriculture, land concessions, and mining. While they are not the only foreign firms investing in extractive industries in the region, Chinese companies and financial institutions are facing increased criticism for damaging resource extraction and infrastructure projects in the mining, timber, hydropower, and agricultural sectors in Southeast Asia—particularly in Cambodia, Laos, Burma, and Indonesia. Unlike the extensive media coverage and analysis of China’s aid and investment projects in Africa, discussions and research about China’s engagement in Southeast Asia are sporadic and isolated, often focused on a single country, sector, or project. To begin filling this knowledge gap, this series of three research briefs provides an overview of various environmental impacts caused by China’s outbound aid, trade and investment projects in Southeast Asia, as well as explores polices and practices within China that drive the operation of Chinese companies in Southeast Asia.

Southeast Asia’s Economic Powerhouse
China’s engagement in Southeast Asia is far-reaching and increasingly diverse in recent years. Between 2002 and 2007, the combined value of China’s aid and related investment projects (both public and private) in Southeast Asia amounted to $14.8 billion, of which:

• 43 percent was channeled to infrastructure and public works projects;
• 32 percent to natural resource extraction; and,
• 3 percent to military, humanitarian, and technical assistance activities.[4]

While China’s aid and investment in Southeast Asia is growing, among ASEAN’s largest sources of FDI from 2006 to 2008, China ($3.6 billion) ranked fifth following EU ($42.2 billion), Japan ($25.8 billion), the United States ($12.8 billion), and South Korea ($5.8 billion).

Nevertheless, China and ASEAN’s economies are increasingly linked.[5] Traditionally, oil, gas, copper, rubber, palm oil and timber from Southeast Asia provide much-needed resources for China’s economic growth whereas Chinese exports of machinery, electronic equipment and consumer goods supply the markets of Southwest Asia. Yet China and ASEAN are serious competitors in U.S., Japanese and EU markets for products like textiles, apparel, and electronics.

China as a Donor
While still not the leading donor country, China’s growth in as foreign aid provider in Southeast Asia, which began in the 1950s, is enhancing its relations in the region. Before the 1980 “reform and opening” policy, China’s foreign aid was largely unilateral and politically motivated. Specifically, China provided a great deal of aid to newly independent countries out of political consideration.[6] However, this type of ideological-driven foreign aid policy has gradually changed with the deepening of China’s economic reforms that have catalyzed rapid and sustained growth in the country for the past 30 years. China’s leadership increasingly focuses on the mutual benefits—political and economic—in its foreign aid programs. The middle of 1990s saw another new trend in China’s foreign aid policy where foreign aid was viewed by the leadership as an increasingly important tool of soft power with a focus on humanitarianism and image building.[7]

Over the past several decades, China’s aid into Southeast Asia has come in the form of government-sponsored investment, concessional loans, grants, and debt cancellation.[8] A 2008 Congressional Research Service report noted that China has been the largest source of economic assistance to Burma and may be the second largest source of foreign aid to Vietnam.[9] In addition, China has provided considerable aid to Laos and also more developed Southeast Asian countries such as Indonesia, the Philippines and Thailand.[10]

Regional Trade Agreements and Foreign Direct Investment
CAFTA
As a clear sign of the growing trade linkages, China and ASEAN have reached a series of trade agreements to aid the flow of goods, service, and investment between the two economic blocs. The most notable is an agreement reached in 2002 to establish a China-ASEAN Free Trade Area (CAFTA) within 10 years. After its launch on January 1 2010, CAFTA has become the first free trade zone in which China participated and the world’s third largest free trade area, after NAFTA and the EU. Under the terms of CAFTA, China and ASEAN countries will impose zero tariffs on about 90 percent of goods traded between them.[11] CAFTA will increase both the trade volume as well as economic integration in the region, which notably could facilitate natural resource extraction activities by Chinese businesses.

The current global financial crisis further brings the nations of Southeast Asia and China closer. In order to help ASEAN countries recover from the crisis more quickly, China has announced its plan to create a $10 billion China-ASEAN Investment Cooperation Fund and offer $15 billion in credit to its Southeast Asian neighbors. According to the plan, the investment fund will promote infrastructure development linking China with the 10 members of ASEAN, while the loans will be offered over three to five years. In addition, China will provide 270 million Yuan ($39.5 million) in aid to Cambodia, Laos and Burma, and donate 300,000 tons of rice to an emergency East Asia rice reserve to boost food security in Southeast Asia.[12]

During the global economic crisis, China’s aid, trade and outbound investment have helped stimulate growth in Southeast Asia and even stabilize the region somewhat.[13] As China’s economic influence expands in Southeast Asia, countries in the region increasingly choose to partner with China instead of Western enterprises, particularly in the exploration and development of hydropower, oil, gas and other resources.

Infrastructure Investment
Infrastructure construction is another area where China and ASEAN countries increasingly find common ground. After three decades of “Open Door” economic policies, China is undergoing an unprecedented construction boom in transportation, telecommunications, and power grid to support the world’s fastest and largest urbanization boom. With large amounts of cash on hand and encouragement from the government’s “Go Global” strategy—an effort initiated in 1999 by Chinese government to promote Chinese investment abroad—many Chinese enterprises have begun to seek opportunities overseas. These companies not only look to Southeast Asia to supply raw materials, but also are increasing capital investment in the region. According to a joint survey conducted by the Asia Pacific Foundation of Canada and the China Council for the Promotion of International Trade, in 2009, some 35 percent of Chinese companies indicated that East and Southeast Asian countries are their preferred region for overseas investment. Second tier destinations include North America, Africa, and Western Europe. [14]

In recent years, the Chinese government and private companies have financed and operated many infrastructure, energy (especially hydropower), agricultural and other development projects in Southeast Asian countries, which rely on Chinese materials, technical expertise and labor.[15] While these projects play an important role in generating income for some of the poorest countries in Southeast Asia, analysts believe these activities also help China access raw materials and energy.[16]

Like China’s rise in other regions of the world, China’s increased visibility in the region also inspires a mix of awe, fear and skepticism. Some western analysts argue that China’s growing economic and political influence in Southeast Asia could represent a loss of U.S. and European influence in the region. International watchdog organizations—ranging from international groups such as Global Witness, The Nature Conservancy, The International Union for Conservation of Nature, and International Rivers to community environmental groups in the region—are closely monitoring the involvement of Chinese industries in dam-building, mining, and rubber plantation encroachment in Southeast Asia. Notably, Chinese companies are part of a larger trend of international investment in extractive industries in the region—with Korea and a number of Middle Eastern countries being other dominant players.[17] In all of these extractive industries there are a number of common drivers shaping Chinese investment in ways that are not always sustainable:

• Little effective regulation by the China’s government of Chinese industries investing overseas, especially privately owned companies;
• Weak sense of social and environmental responsibility among Chinese companies; and,
• Poor governance in host countries leading to little regulation of foreign firms.

The Chinese government has begun to recognize the damage its businesses are causing in Southeast Asia, which has led to new policies within China’s banking and industrial regulation. Notably, many of the same environmental challenges facing Southeast Asia mirror those within China. Thus, addressing the environmental impacts of Chinese engagement in Southeast Asia could and should be an inseparable part of China’s own effort to address environmental issues at home.

Hydroelectric Dam Construction
China is the country with the largest number of dams in the world. In addition to building more dams domestically, Chinese companies also have taken a lead in building dams abroad, especially in Southeast Asia and Africa due to the relatively low construction costs and fewer political conditions attached to these dam projects.[18]

In recent years, water and energy supply shortages have become a pressing issue in most ASEAN countries due to rapid economic development, urbanization, and population growth. While these countries are rich in water resources, they generally lack technology and capital to develop their own hydropower projects, which provides an opportunity for Chinese companies to invest in hydroelectric projects in these countries. Take, for example, the Shweili Dam project jointly financed by Chinese companies and the Burmese government. The dam, which was put into operation and began to generate electricity in 2008, is China’s first build-operate-transfer (BOT) hydropower project in Burma and also the largest dam in the country. The Chinese news media reported the dam will not only address the electricity shortage in the northern part of Burma, but also transmit the majority of electricity generated by the project to Southern China. The electricity from Burma will join power generated in Yunnan to form a West to East Electric Power Transmission project, an important part of the Chinese government’s Western Region Development Strategy in southwest China.[19]

According to International Rivers, Chinese financiers and companies are involved in constructing some 220 large dams in 49 different countries, half of which in Southeast Asia—including large dams such as the Kamchay and Sambor dams in Cambodia and the Shweli Dam in Burma. International Rivers also reported that many of the dams involving Chinese investors have already impacted local communities and ecosystems. In some cases, villagers were not consulted in advance of the dam’s construction; which meant they were unable to voice concerns to mitigate damaging outcomes or submit claims for compensation.[20] In a May 2009 report, the United Nations Environment Programme and the Asian Institute of Technology warned that China’s plan for a cascade of eight dams on the Mekong (some within China) might pose “a considerable threat” to the river and its natural riches.[21]

To understand China’s approach to dam-building companies going abroad, it is helpful to review China’s domestic political dynamics surrounding dam building. Recent plans to build dams in China’s Jinsha and Nu rivers have provoked an unprecedented series of domestic protests due to environmental and social costs.

The debate is divided into two camps: the anti-dam environmental journalists, NGOs and scientists who focus on the environmental and social damage of dam building, and the dam supporters (companies and local governments) who usually argue that the environmental consequences of dam building are exaggerated and that many environmental effects can be mitigated or compensated. Dam-building supporters argue that developing countries pushing hydropower are usually rich in water resources, but with a relatively low hydropower exploitation rate compared with that of Western countries. Furthermore, hydropower represents a cheap, renewable carbon-free energy source. The United States and other water-rich developed countries passed the peak of industrial dam-building in last century and environmental concerns of dams have also lessened their appeal.[22] Various reports also seem to support the argument. According to a 2009 World Bank report, the amount of untapped hydropower in the developing world is tremendous—nearly four times the capacity currently installed in Europe and North America.[23] Another World Bank report shows that China’s generated hydropower was only 23 percent of the country’s economic exploitable hydropower potential in 2003. The corresponding numbers for Indonesia and Vietnam were 25 and 24 percent, respectively. By contrast, Norway, Japan, and the United States have exploited 87, 88, and 72 percent, respectively, of their hydropower potential.[24]

While both sides cannot persuade each other, the voices of opposition to dams are gaining strength and the Chinese government has begun to take opposing opinions into consideration. For instance, in May 2009 Premier Wen Jiabao postponed the construction of several hydropower projects on the middle and lower reaches of the Nu River and indicated that the decision to move these projects forward “should be made based on scientific evidence.”[25] This was the second time Premier Wen suspended the hydropower plans on the Nu River since 2004. In June 2009, opposition efforts by environmental NGOs, reporters, and scholars led the Ministry of Environmental Protection to suspend the Long Kai Kou and Lu Di La hydropower projects on the Jinsha River that were being planned by the state-owned China Huaneng Group and China Huadian Corporation, respectively.[26]

However, decisions from the central government to suspend the hydropower projects sometimes are not always respected or implemented by hydropower companies backed by local government. Just three days after MEP suspended these two hydropower projects on the Jingsha River, locals and reporters found the construction was still going on.[27] The construction of Jing An Qiao hydropower project in the middle reach of Jinsha River started even before the central government approval was granted.[28] The Yunnan provincial government—which stood to profit from the project—gave the dam builder, a privately owned hydropower company all the green lights the project needed to proceed.

There are a few explanations for the intergovernmental wrangling over hydropower development in China’s southeast.[29] According to former vice president of State Electricity Regulatory Commission Shao Binren, based on different installed capacities and sources of investment, hydropower projects need to get approval from different levels of government, which in turn leads to misunderstanding and confusion on hydropower projects. Secondly, the line between the preliminary construction and real construction of a hydro project is not clear-cut and this very often makes profit-seeking dam building companies take risks to start the construction of dams even before their projects get government approval.

Green NGOs usually take a different perspective on the matter. According to Dr. Lü Zhi, a well-known Chinese scientist who founded the Beijing-based NGO Shan Shui Conservation Center, the dam-building controversies exposed the weakness in the decision-making mechanism for large-scale construction projects. The key issue is not whether to build a dam, but rather how to institute a healthy decision-making process in which all the stakeholders of dam building can participate in the process.[30] Lü Zhi’s view on China’s domestic dam building is echoed by the views of many international NGOs. “What we need to look at is the reallocation of risks and benefits. Often the benefits accrue to people far away from dam with higher political power…Local people, who are marginalized from political process have the least voice and are often heavily impacted by these projects,” commented Carl Middleton with International Rivers on dam building in Cambodia.

Despite the great hydropower potential in Southeast Asia, many local and international environmental NGOs paint a rather grim picture of explosion of dam-building projects in the region. Terry Parnell, a Cambodia-based biodiversity and grassroots advocacy advisor with the U.S. NGO West-East Management Institute, pointed out that dams destroy important ecosystems limiting the ability of local communities to access food and water.[31] According to Parnell, there is also some debate about whether reservoirs will supply irrigation and water diversion schemes for foreign funded agro-industrial projects, which often lead to displacement of indigenous communities. Terry Parnell sees dam building in Cambodia as not only an environmental issue, but also an economic and political issue with local communities not benefiting from the power and crops generated.

Given the huge economic profits dam-building projects will bring to the host country governments and investors, and the growing interest in sustainable energy and climate change worldwide, more dam projects financed and implemented by China can be expected in Southeast Asia countries. While the awareness of environmental and social impacts of domestic dam building is increasing among China’s top leadership, it is not clear to what extent this will translate into action by Chinese policymakers to address these impacts at home, let alone in Southeast Asian countries.

Extractive Mining and Oil Companies
Mining & Oil Extraction
Driven by China’s double-digit economic development rate and insufficient domestic mineral resources, Chinese mining and oil firms are aggressively looking for opportunities abroad to invest in joint ventures, acquire mining projects and companies, and secure long-term contracts at set price levels.[32] Statistics from China’s General Administration of Customs show that China’s crude oil dependency reached alarming levels in 2009 with more than half of the country’s total oil consumption coming from abroad.[33] A report issued by Earth Policy Institute in 2005 also noted that China has overtaken the United States to become the world’s largest consumers of metals such as aluminum and copper.[34] While most of China’s foreign energy supplies originate from the Middle East and Africa, Southeast Asia has also increasingly become an important source of energy and minerals.[35]

Vietnam, Cambodia, Burma, Laos and Indonesia are rich in coal, copper and other mineral resources,[36] but the exploitation of these resources has typically been on a small scale and long delayed due to political instability, complicated and diverse topography, and/or the lack of capital technology and capacity to establish extensive mining operations.[37] Numerous investments in transport infrastructure in the Mekong River Basin by multilateral organizations have encouraged greater trade between Southeast Asia and China. The improved trade infrastructure has been key in helping China become a major strategic investor in developing mining in Southeast Asia.[38]

For instance, China is the largest investor in the mining industry in Laos with 50 Chinese mining companies currently operating in the country (among a total of 140). China is also Thailand’s largest mining partner in Southeast Asia.[39] Elsewhere in Southeast Asia the Aluminum Corporation of China (Chinalco), the world’s second largest alumina producer, has formed a joint venture in Vietnam to undertake $1.3 billion worth of investments. Chinese companies also are involved in a $950 million nickel mine development project in the Philippines.[40] The most recent example is Mining Resources Alliances Investment Cooperation that was established by four steel giants in China. In the opening ceremony held in January 2010, the company announced that their first investment will be an iron ore mining project in Cambodia.[41]

China has become Brunei’s eighth largest consumer of crude oil since 2000. And in 2002 and 2006 China signed major contracts with Indonesia and Malaysia for the supply of liquefied natural gas (LNG). China would like also to increase energy imports from Burma and Timor Leste, and is working on pipeline projects with both countries in pursuit of that goal.[42] In addition to the oil sold on the international market, a large percentage of oil produced by Chinese oil companies in Southeast Asia is also exported into China.[43]

Toxic Legacies
Many Southeast Asian governments that back Chinese and other foreign energy and mining projects are notably lax in enforcing rules to mitigate the negative environmental impacts of such extractive industries. Toxic wastes from mining, processing, and transport of minerals and loss of land are major drivers behind protests against foreign mining and oil companies in Southeast Asian countries. With China’s fast-growing investments in extractive mining and petroleum projects in Southeast Asia, Chinese investments also have begun attracting attention from civil society and community activists in the region.

For instance, to diversify China’s crude oil imports and reduce the amount of oil transported through the vulnerable Strait of Malacca, China has long planned to build oil and gas pipelines linking Burma’s deep-water port Kyaukphyu and Southwest China. According to Xinhua, the oil pipeline linking Burma’s Kyaukphyu (Sittwe) with Kunming in Yunnan Province, which opened in September 2009, has an annual capacity of 22 million tons of crude oil. A parallel natural gas pipeline also will be built in the near future. Although the pipeline projects are hailed by both Chinese and Burmese governments, they also have raised serious environmental and social concerns in both countries. According to the Shwe Gas Movement, the most vocal anti-pipeline campaign in Burma, environmental dangers posed by the commercial production and transport of natural gas include the leakage of chemicals used in the drilling process as well as potential gas blowouts. In addition, the construction of pipelines and accompanying infrastructure may also split forests, disrupting the habitats and migratory paths of animals.[44]

Chinalco’s project that began mining bauxite ore in Vietnam’s central highlands in February 2010 also has met harsh criticism. Critics say the arrival of large-scale bauxite mining in this ecologically important region could cause “irreparable damage” to the environment.[45] On the ground of environmental protection and national security, a Vietnamese lawyer even filed a lawsuit against the Vietnamese premier who approved the project. In striking contrast, local communities have expressed minimal criticism against the American aluminum giant Alcoa, which also partnered with the Vietnamese government in a joint mining venture also located in Vietnam’s central highlands. The Alcoa and Chinalco projects were also similar in production capacity with each aiming to turn out 600,000 tons of alumina per year.[46] Many analysts believed that other considerations such as Vietnamese historical grievance towards Chinese people and fierce competition from increasingly powerful China may be more important reasons than environmental concerns behind the more vocal criticisms towards Chinalco.[47]

While it is difficult to verify the exact environmental impacts of Chinese and other international investors in the region, the poor track record of Chinese mining companies within China does indicate they could be major polluters abroad, particularly in countries with even weaker environmental governance systems. Notably, there are a few positive signs on the side of Chinese government. For example, in addition to issuing various measures to curb pollution caused by the mining industries domestically, China’s National Development and Reform Commission is also considering establishing a special agency to implement upcoming regulations of Chinese company operations overseas.[48] Moreover, the Chinese government has given Chinese news media more freedom to report on the toxic threats posed by mining industries within China, such as the widespread media coverage of children lead poisoning in several provinces in the country in 2009.

While some Chinese mining enterprises—especially large state-owned companies—have started to adopt better environmental and social standards, the industry as a whole has not seen a major shift toward better environmental and social performance. Jill Shankleman, a scholar at with the Woodrow Wilson Center, noted that overseas Chinese mining and oil companies have already shown progress in terms of environmental and social standards, such as getting better local information through project feasibility studies, complying with local environmental, labor and land acquisition laws, and even supporting local philanthropic projects. However, when these firms face environmental and social issues related to their investments, “such problems are currently less of a priority for corporate management than are other aspects of internationalization such as overcoming barriers to investment, contract stability, taxation and currency transfer.”[49] Shankleman also argues that little evidence exists to prove regulatory and policy pressures within China are important in determining how environmental aspects of overseas projects are conducted. However, over time these forces could contribute to building the skills and experience required for application of higher standards.[50]

Rubber Plantation Expansion
Compared with dam building, mining and illegal wildlife trade, China’s engagement in rubber plantations in Southeast Asia did not catch much international attention until three American and Chinese researchers published an article in Science magazine in May 2009.[51] According to the article, more than 500,000 hectares (1.2 million acres) may have already been converted to rubber plantations in the uplands of China, Thailand, Vietnam, Laos, Cambodia and Burma. By 2050, the area of land dedicated to rubber and other diversified farming systems could more than double or triple, largely by replacing lands now occupied by evergreen broadleaf trees and swidden-related secondary vegetation.[52] Favoring industrial rubber plantation over traditional swidden (slash and burn) agriculture across Southeast Asia may carry detrimental environmental consequences, including loss of biodiversity, reduction of carbon stocks and possible degradation of water resources.[53]
Jefferson Fox, one of the coauthors of the Science article and senior fellow at the East-West Center in Honolulu, stressed that while rubber plantation’s impact on biodiversity is easy to predict, determining the impact of land conversion on hydrology is complex.[54] Fox and his team looked into the hydrological impact of land conversion in Yunnan Province in China from 2004 to 2006, and then in Southeast Asian countries such as Laos, Thailand, Vietnam, Cambodia, and Burma. While the study is still in progress, it appears that agrarian conversion to oil palm in insular Southeast Asia has already demonstrated how detrimental such hydrological impacts could be.
Fox believes that besides the obvious market forces and land constraints that are driving China’s rubber investments abroad, the Chinese government also actively encourages such investments in order to ensure steady supply of one of China’s most important industrial materials. As the world’s largest rubber consumer, China is aggressively seeking to expand its natural rubber output.[55] China’s investment in oversea rubber plantations is not only an important part of Yunnan Province’s implementation of the “Go Global” strategy, but also one of the key projects of China’s participation in the Greater Mekong Subregion Economic Cooperation program, an initiative sponsored by Asian Development Bank and 6 countries of the Mekong River basin.[56] In the mid-2000s, China officially integrated narcotics control efforts into the national economic agenda and began aggressively subsidizing the development of opium replacement plantations in northern Laos and Burma through various forms of subsidies, loans, and tariff exemptions.[57] As a result, China’s investment in rubber plantations is considered as a win-win solution and greatly supported by Lao and Burmese governments. For instance, the Lao government considers rubber industry as one of the country’s pillar industries and has listed opium replacement plantations into the country’s strategic economic development plan.[58]
China’s engagement in ecologically damaging rubber plantations in Southeast Asia is also an extension of an increasingly serious domestic environmental issue where the conversion from land covers to rubber has long been a problem within China. As rubber prices have tripled over the past decades, rubber plantations have also boomed everywhere in Xishuangbanna, one of the top rubber-producing regions in China. Now covering about 400,000 hectares, rubber plantations occupy 20 percent of the prefecture’s land. Studies by many Chinese researchers have demonstrated ecological impacts of land conversion in terms of nutrient cycling, erosion control and climate regulation and provisions of raw materials and wildlife habitats.
The People’s Congress of Yunnan Province issued a rubber management regulation in 1992, but Chinese scholars note that the regulation is largely outdated and needs updating. It is reported the Xishuangbanna prefecture government has already finished drafting an updated version of the regulation that would, if enacted, address rubber plantation issues while restoring the region’s ecosystems. But it is not clear whether environmental regulations will be strong enough to control the lucrative rubber trade. Even the prefecture’s communist party Secretary admitted that they could make any number of laws, but until they provide the farmers with appropriate compensation and alternative economic means, none of the laws can be effectively implemented.[59]

A Need For Better Environmental Governance in the Region
As the Chinese economy becomes more tightly integrated with Southeast Asia through formal trade, aid, and investment, weaknesses in the environmental governance the region becomes an even greater problem. Of major concern are the ecological impacts of some investment by Chinese individuals and private companies into mining, hydropower, and rubber plantation projects—which are legal and welcomed but poorly regulated by host countries. Highly damaging to Southeast Asia’s environment are the growing underground illegal logging, poaching and smuggling activities carried out by Chinese individuals and companies, which will be discussed in the second research brief in this series. In pondering solutions to China’s ecological impact on Southeast Asia it is important to differentiate formal government aid, investment and trade from the illegal activities. The third brief in this series will examine some efforts by the Chinese government and international organizations to help improve the environmental governance in both China and Southeast Asia to better protect the region’s environment.

Jennifer Turner has been director of the China Environment Forum for nearly 11 years, where she creates meetings and study tours for global energy and environmental practitioners focused on China. She is also the senior editor of the yearly journal China Environment Series. She can be reached at jennifer.turner@wilsoncenter.org. Ada Wu was a research assistant with CEF. She can be reached at: wuyue310@gmail.com.

[1] The Cardamom Mountain-Cambodia's Natural Heritage, Angkor Guides
[Online]. Available:
http://www.angkorguides.com/evironments&info/cardamommountain.php?mid=222.
[2] Conservation International (2007) “A summary of the social and environmental impacts of the proposed Areng Valley hydroelectric dam, southwest Cambodia”. Field report prepared by Conservation International.
[3] Ibid.
[4] CRS: Congress Research Service (2009, Feb). “China’s Foreign Aid Activities in Africa, Latin America, and Southeast Asia.” [Online]. Available: http://www.fas.org/sgp/crs/row/R40361.pdf.
[5] In terms of trade volumes, Chinese data cites ASEAN and China as each other’s fourth-largest trading partner. See: ASEAN: Association of Southeast Asian Nations (2009, August) Foreign Direct Investment Database, [Online]. Available: http://www.aseansec.org/Stat/Table26.pdfhttp://www.aseansec.org/Stat/Table26.pdf and Liu Yuyin. (2009, Oct. 20) “China and ASEAN Free Trade Area to be Established.” China News Service. [Online]. Available: http://asean.yunnan.cn/html/2009-11/02/content_963807.htm.
[6] Zhang Qinming, (2009, Aug. 28) “From Internationalism to Mutual Benefits- the Evolution of China’s Foreign Aid Policy. [Online]. Available: http://lianghui.china.com.cn/news/60years/2009-08/28/content_18422630.htm
[7] Ibid
[8] CRS: Congress Research Service. (2009, Jan. 4). “China’s Soft Power in Southeast Asia”
[Online]. Available:
http://www.fas.org/sgp/crs/row/RL34310.pdf
[9] Ibid
[10] Ibid
[11] China Daily, (2009, Oct. 22) “The Establishment of China-ASEAN FTA”
[Online]. Available:
http://www.chinadaily.com.cn/zgzx/2009-10/22/content_8828231.htm
[12] Dune Lawrence (2009) China Plans $10 Billion Asean Investment Funding. Bloomberg
[Online]. Available:
http://www.bloomberg.com/apps/news?pid=20601110&sid=azo6VdjXJ7RY.
[13] Dorothy C. Zbicz, Jennifer Turner & Linden Ellis (2008) Asia's Future: Critical Thinking for a Changing Environment. [Online]. Available: http://www.wilsoncenter.org/topics/pubs/Asias%20Future1.pdf.
[14] Asia Pacific Foundation of Canada & China Council for the Promotion of International Trade. (2009, Sep.) “China Goes Global 2009-Survey of Outward Direct Investment Intentions of Chinese Companies.”
[Online]. Available:
http://www.asiapacific.ca/files/Surveys/China_Goes_Global3_final.pdf.
[15] CRS: Congress Research Service. (2009, Jan. 4). “China’s Soft Power in Southeast Asia.”
[Online]. Available:
http://www.fas.org/sgp/crs/row/RL34310.pdf.
[16] Ibid.
[17] Ibid.
[18] International Rivers. China’s Global Role and a Phone Interview with Nicole Brewer with International Rivers. [Online]. Available: http://www.internationalrivers.org/en/china/chinas-global-role.
[19] Pu Chao. (2009, May 17). “China's Largest BOP Dam-building Begun Operation”, Xinhua.
[Online]. Available:
http://www.yn.xinhuanet.com/newscenter/2009-05/17/content_16546794.htm.
[20] International Rivers, Shweli 1 Dam, A Case study. [Online]. Available: http://www.internationalrivers.org/en/southeast-asia/burma/shweli-1-dam.
[21] Michael Richardson. (2009, Sep. 28). Mekong River development: China’s Dams Worrying SE Asia. The Straits Times.
[22] Interview with an official from Suzhou Water Resource Management Bureau, December 2009.
[23] World Bank, (September 2009) “Directions in Hydropower.” [Online]. Available: http://siteresources.worldbank.org/INTWAT/Resources/Directions_in_Hydropower_FINAL.pdf.
[24] World Bank. “Tapping East Asia and Pacific’s Hydropower Potential.” [Online]. Available: http://go.worldbank.org/1TGPVE6VX0.
[25] China Society for Hydropower Engineering. (2009, Oct. 16). “The Truth is Anti-Dam-Who is opposing Dams?” [Online]. Available: http://www.hydropower.org.cn/info/shownews.asp?newsid=1743.
[26] Ibid.
[27] Who Protects Jing Sha River? (July 2009). Transcript of “News Weekly” of CCTV.
[Online]. Available:
http://news.sina.com.cn/c/2009-06-20/222618060502.shtml.
[28] Zheng Quanlun (June 2009) “The Deadlock of Jin An Qiao Project.” Times Weekly. [Online]. Available: http://news.hexun.com/2009-06-25/118992438.html.
[29] Liu, Xiaoxing, (July 2009). “What Entangled the Hydropower Development?” China Environmental News. [Online]. Available: http://www.cenews.com.cn/xwzx/dh/200907/t20090727_619993.html.
[30] Liu, Jianqiang. (2004). “Tiger Leaping Gorge Emergency.” Southern Weekly. [Online]. Available: http://www.people.com.cn/BIG5/news/37454/37461/2826968.html.
[31] From an interview with Terry Parnell from West-East Management Institute, December 4, 2009.
[32] Kate M. Lazarus. (2009). “In Search of Aluminum: China’s Role in the Mekong Region.” Heinrich Böll Stiftung, WWF and International Institute for Sustainable Development. [Online]. Available: .
[33] Wang, Qian. (January 2010). “Oil Imports Hit Alarming Level in China, Study.” China Daily.
[Online]. Available:
http://www.chinadaily.com.cn/bizchina/2010-01/14/content_9317926.htm.
[34] Lester R. Brown. (2005, Feb. 16). Plan B Update. [Online]. Available: http://www.earth-policy.org/index.php?/plan_b_updates/2004/update45.
[35] Iran I. Story. (2009, Sept). “China a Major Player in Southeast Asia Pipeline Politics.” [Online]. Available: http://www.themalaysianinsider.com/index.php/opinion/breaking-views/38368-china-a-major-player-in-s-e-asia-pipeline-politics--ian-j-storey.
[36] Yang Yang & Shi Yu. (2009, Sep. 7). “Five Southeast Asian Countries Welcome China to Invest in their Mining Industries” China News Service. [Online]. Available: http://fec.mofcom.gov.cn/xwdt/gn/541541.shtml.
[37] Kate M. Lazarus (2009) “In Search of Aluminum: China’s Role in the Mekong Region”. Heinrich Böll Stiftung, WWF and International Institute for Sustainable Development. [Online]. Available: http://www.tradeknowledgenetwork.net/pdf/in_search_of_aluminum.pdf.
[38] Kate M. Lazarus (2009) “In Search of Aluminum: China’s Role in the Mekong Region”. Heinrich Böll Stiftung, WWF and International Institute for Sustainable Development.[Online]. Available: http://www.tradeknowledgenetwork.net/pdf/in_search_of_aluminum.pdf.
[39] Yang Yang & Shi Yu. (2009, Sep 7). “Five Southeast Asian Countries Welcome China to Invest in their Mining Industries.” China News Service. [Online]. Available: http://fec.mofcom.gov.cn/xwdt/gn/541541.shtml.
[40] Jennifer C. Li. (2007). “China’s Rising Demand for Minerals and Emerging Global Norms and Practices in the Mining Industry.” Mineral & Energy- Raw Materials Report, 1651-2286, Vol. 22, Issue 3, 2007, pp 105-126. [Online]. Available: http://74.125.47.132/search?q=cache:vCdIBxUHJ-MJ:www.coleurop.be/file/content/StudyProgrammes/eco/chair/toyota/200612_conference/Papers/LI_Chinas_Rising_Demand_For_Minerals.pdf+China%27s+rising+demand+for+minerals+and+emerging+global+norms+and+practices&cd=3&hl=en&ct=clnk&gl=us.
[41] Xu Yuli, (2010, January) “Four Chinese steel mills to jointly develop mineral resources in Cambodia” Shanghai Securities News. [Online]. Available: http://www.asean35.com/news/13135.html.
[42] Jennifer C. Li (2007) “China’s Rising Demand for Minerals and Emerging Global Norms and Practices in the Mining Industry” Mineral & Energy- Raw Materials Report, 1651-2286, Vol. 22, Issue 3, 2007, pp 105-126.
[43] Downs, Erica S. (Summer 2007) “The Fact and Fiction of Sino-African Energy Relations,” China Security 3, No. 3, PP.42-86.
[44] The Shwe Gas Movement. (2009 September) “Corridor of Power: China’s Trans-Burma Oil and Gas Pipelines.” [Online]. Available: http://www.scribd.com/doc/19490565/Corridor-of-Power-Chinas-TransBurma-Oil-and-Gas-pipelines.
[45] The Economist. (2009 April 23). “Vietnam, Bauxite and China”. [Online]. Available: http://mailman.anu.edu.au/pipermail/enviro-vlc/2009-April/001706.html.
[46] Reuters, (March 30, 2009) Vietnam Bauxite decision may Affect Alcoa Project, [Online]. Available: http://www.chinamining.org/News/2009-04-30/1241056444d24220.html.
[47] Li Ran, Liu Yang & Ding Liangheng. (2009 April). Vitenamese Media Hyping up Chinese Mining Project. Global Times. [Online]. Available: http://www.geichina.org/ep/news/2009/0427/article_560.html.
[48] Xu Yuli. (2010, January). “Four Chinese steel mills to jointly develop mineral resources in Cambodia” Shanghai Securities News. [Online]. Available: http://www.asean35.com/news/13135.html.
[49] Jill Shankleman. (2009). “Going Global: Chinese Oil and Mining Companies and the Governance of Resource Wealth” Woodrow Wilson International Center for Scholars. [Online]. Available:
http://www.wilsoncenter.org/topics/pubs/DUSS_09323Shnkl_rpt0626.pdf.
[50] lbid.
[51] Alan D. Ziegler, Jefferson Fox and Jianchu Xu. (2009, May). “The Rubber Juggernaut” Science Magazine. 22: 1024-1025. [Online]. Available: http://www.sciencemag.org/cgi/content/short/324/5930/1024.
[52] Ibid.
[53] Ibid.
[54] For example researchers must quantify the water use of the original land-cover versus that of the rubber plantations and assess the land degradation caused by planting the rubber.
[55] The Analysis and Prospect of China’s Rubber Market Demand. [Online]. Available: .
[56] An Introduction of Yunnan State Farm Group. [Online]. Available: http://www.1010job.com/review/ListCompany.asp?id=2864.
[57] From a Written Interview with Jefferson Fox, December 2010.
[58] Ibid.
[59] Qiu Jane. (2009, Jan. 14). “Where the Rubber Meets the Garden.” Nature 457, 246-247. [Online]. Available: http://english.xtbg.cas.cn/ns/es/200901/t20090115_29731.html.

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