China Takes Another Green Step Forward

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BEIJING—China is adopting a new green index in a bid to pressure local governments to reduce pollution and create more-sustainable economic development—though a high pace of growth is likely to remain the Chinese leadership’s priority.

In the works for more than a year—and talked about for much longer—the new “green development” index released Tuesday is based on 55 parameters, from carbon emissions to disposable income per capita.

An official with one of the agencies involved in compiling the index said the indicator is meant to guide local governments on development and send a signal to focus less on rapid growth at the expense of the environment. A subindex on quality of growth looks at contributions to growth from services and innovative industries, as well as investment in research and development.

The green index fits into the policy platform Chinese President Xi Jinping laid out in October for his second five years in office, placing greater priority on the quality of growth than the breakneck development that has defined China’s growth model in recent decades. A meeting last week that set government economic policies for the coming year cited pollution reduction as a top objective and promised to use measurable performance indicators to pursue higher-quality growth.

Some economists expressed skepticism about the extent to which the index will matter in changing China’s growth model. While officials have for years bemoaned widespread environmental degradation, reaching economic-growth objectives remains a leading metric in determining whether local officials are promoted. Authorities will rank regions each year based on the green index, but it isn’t a formal part of the performance evaluations for individual officials, according to the official.

“It’s a bit of a prisoner’s dilemma: No one wants to go gung-ho in terms of environmental policy when they haven’t seen this in practice yet,” said

Andrew Polk,

an economist at consultancy Trivium/China. “You don’t want to be the guinea pig.”

Authorities haven’t laid out any consequences for local governments should they score poorly in the green-development assessment. The index is based on data that Beijing was already collecting and its compilation doesn’t entail new inspections of provinces and cities, according to the official.

Though officials have said Beijing is reducing its past reliance on an economic-growth target to drive development, it isn’t expected to do away completely with the target, which for 2017 was around 6.5%. President Xi’s commitment to meet a goal for China to become a “moderately prosperous society” by 2021 relies on continued growth, according to economists.

“Xi’s government is aiming to achieve long-term sustainable growth,” said

David Qu,

a China economist with ANZ. “The premise of this goal is growth.”

Still, Mr. Xi’s government has pursued tighter environmental regulation. The Ministry of Environmental Protection has aggressively sent inspection teams into the provinces and increased the number and amount of fines, according to government data.

Authorities first unveiled components of the green-development index in late 2016, shortly after launching China’s 13th five-year plan for 2016 to 2020. Nearly half of the government’s targets involved the environment, guiding officials to lower energy usage, protect land, improve waterways and reduce air pollution.

At the top of the rankings released Tuesday was Beijing, which had an overall green score of 83.71. The smoggy capital ranked first on a subindex of environmental improvement, but performed poorly on the overall quality of the environment and usage of natural resources. Xinjiang and Tibet, both poorer, less economically developed border regions, were at the bottom of the overall index.

The government released a separate survey on public satisfaction on Tuesday. Beijing came in second-to-last in the survey, despite its top ranking in the green index. The government offered few details on the survey methodology, other than saying that it was conducted by telephone to assess people’s perception on pollution control and sanitation.

In a statement accompanying the release, Ning Jizhe, director of the National Bureau of Statistics, said that the index was a “comprehensive assessment result” while the public’s responses were a “subjective indicator.”

Write to Chao Deng at Chao.Deng@wsj.com



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