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China. Evaluation and Adjustment Of OCCASION This publication has been made available to the public on the occasion of the 50th anniversary of the United Nations Industrial Development Organisation. DISCLAIMER This document has been produced without formal United Nations editing. The designations employed and the presentation of the material in this document do not imply the expression of any opinion whatsoever on the part of the Secretariat of the United Nations Industrial Development Organization (UNIDO) concerning the legal status of any country, territory, city or area or of its authorities, or concerning the delimitation of its frontiers or boundaries, or its economic system or degree of development. Designations such as “developed”, “industrialized” and “developing” are intended for statistical convenience and do not necessarily express a judgment about the stage reached by a particular country or area in the development process. Mention of firm names or commercial products does not constitute an endorsement by UNIDO. FAIR USE POLICY Any part of this publication may be quoted and referenced for educational and research purposes without additional permission from UNIDO. However, those who make use of quoting and referencing this publication are requested to follow the Fair Use Policy of giving due credit to UNIDO. CONTACT Please contact [email protected] for further information concerning UNIDO publications. For more information about UNIDO, please visit us at www.unido.org UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Vienna International Centre, P.O. Box 300, 1400 Vienna, Austria Tel: (+43-1) 26026-0 · www.unido.org · [email protected] Final Report For Automotive Industry Case Study On behalf of the UNID-O project "Evaluation and adjustment of China's Sustainable Industrial Planning and Policies." By The State Information Center Beijing, China June 20, 2001 CONTENTS Summary 1 Chapter 1 Defining Sustainable Development in Chinese Automotive Industry I9 1.1 Definition of sustainable development 19 1.2 Formation and characteristics of sustainable development in China 11-8 1.3 Implication of the sustainable development in automotive industry 15+8 1.4 Review of the sustainable development policies of China's automotive industry .................................................................................................................................... 16+9 Chapter 2 Review of China's Automotive Industry Development 2226 2.1 History of China's automotive industry 22;66 2.2 Automotive industry's influences on China's economy 26M 2.3 Automotive industry's influences on China's environment 46£ , , Chapter 3 Evaluation of Sustainable Development Policies of China's Auto Industry51S8 3.1 Evaluation methods .."" " "..""" """ ,, 51~ 3.2 Policy evaluation " " " "." "" 52,)9 3.3 An analysis of the Chinese situation during the 10th five-year plan " 8498 3.4 Conclusions: improvements of current policies""" """ "." " 86-1-00 Chapter 4 Lessons from Selected Countries in SO Policies of Automotive Industry881-02 4.1 Lessons from US " "" ".." ""." " " 88~ 4.2 Lessons from Japan .." " "" " "" 96ill 4.3 Lessons from Brazil "".""."""."".""""""""""""""."."""" ".""""" 103-h!G 4.4 Lessons from Republic of Korea"""""".""""""" ...."" ...".."""""".".".""". 109m 4.5 Lessons from Other Countries"""""."""."".""""""""."""""""""".""""" 113~ Chapter 5 Future Policy Guidelines and Suggestions 116+34 5.1 To formulate a strategy and to set a pattern for long-term development.. ill~ 5.2 To support load truck to make them more competitive"."" ...".""".""""".lliHe 5.3 To encourage the production of clean and fuel-efficient vehicle."""""""" 119-:88 5.4 To develop speed transportation system and make people less dependent on automobiles "." " "" "" .." " "" ".." " " 12~ 5.5 To give rational adjustment of tax and expenses on automobiles and reduce the frequencies of car use" "..""."." "" "." "" " ".. 121-!-4Q 5.6 To get engaged in study of sustainable development for automotive industry as soon as possible " " " " "." " " ". 122+4+ 5.7 To set up and complete the social service system centered on car use ..""" 122+4+ Reference 123143 Summary Backarounds and Purposes Since the term "sustainable development" was originally put forward in the report Our Common Future by the World Commission on Environment and Development in 1987, sustainable development has been universally acknowledged as a guiding principle for policymaking. There are several principles in the concept, such as lasting development, harmony, quality and fairness. However, there is no uniform interpretation of the concept and since the situation in different countries vary, their sustainable development policies is also different. This report below is based on an analysis of automotive industrial policies in China and other countries, and aims to evaluate the benefits and costs of China's previous industrial policies for the automotive industry. This study attempts to put forward some feasible policy suggestions in view of the sustainable development of China's automotive industry. Since China is a developing country and automotive industry plays an important role .. in national economy, this is a topic of great concern to the Chinese government. Outline This report is divided into five chapters. Chapter 1 defines the implications of the sustainable development concept and its application in the automotive industry and what sustainable development policies have been adopted in China's automotive industry until now. Chapter 2 firstly gives a brief review of China automotive industry development, and then use an Input-Output (10) - model called MUDAN to analyze the important role of the automotive industry in the national economy, in order to explain the need for China formulate sustainable development policies focused on the automotive industry. Chapter 3 evaluates current sustainable development policies related to China's automotive industry, which include the industrial policy for automotive industry, import policy, fuel tax policy, and environmental policy. It is the core of this report. The aim is to summarize what China may learn from the performance of and experiences with its own policies that influence the automotive industry. Chapter 4 analyses and evaluates sustainable development policies for several selected automotive manufacturing countries. Detailed analysis is provided of the policies in the USA, Japan, Brazil, South Korea, while a more cursory analysis is provided of some of the European experiences. Then and more importantly, the report discusses what may be learned from the experiences of those countries. Chapter 5 provides our policy suggestions for a sustainable development policy for China's automotive industry, based on the analysis in the previous chapters. Main Points 1) Sustainable development is a relatively new development concept. There are different interpretations of the concept of sustainable development and different countries may adopt a different development type according to their own conditions. 2) China's interpretation of sustainable development belongs to the type of "weak sustainable development", alloding tradeoffs between economic growth and environmental quality. It has the following characteristics: (1) economic growth is the core of China's sustainable development. (2) population control and providing more job opportunities must be emphasized. (3) enduring resources utility, environmental protection and ecosystem balance are important parts of sustainable development. (4) To emphasize harmonious development; (5) to emphasize international cooperation and the construction of sustainable development capability 3) With regard to China's automotive industry, sustainable development includes the following aspects: (1) From the economic perspective, to increase the competitiveness of automotive industry. (2) From the social perspective, to stimulate employment and to increase people's income, and of course, to pay attention to its negative social impacts such as traffic accidents. (3) From the resource utilization and environmental protection perspective, to give priority to save energy and treat exhaust pollution. At present, the main point of environmental protection of automobiles is to manage and control emissions. 4) Since the foundation of the First Automotive Works in Changchun, Jilin province in 1956, China's automotive industry has made great progresses in production 2 capacity, product varieties and technology. 5) Automotive industry plays a very important role in China's economy. Although the value added of automotive industry accounted for only 2.8% of value added of manufacturing industry,and 0.6% of GDP in 1997, automotive industry has strong backward and forward linkages with upstream industries (such as metallurgy, machinery, and electronics) and downstream industries (such as transportation, fuel production, auto repairs and maintenance, and finance and insurance). If these linkages are taken into account, the automotive industry's direct and indirect contribution to GDP reached 9.81% in 1997. Also, automotive industry employed 1.814 million workers directly in 1997, while it employed 19.995 million employers indirectly in its related industries. 6) Since automotive industry plays such an important role in national economy, it is of the utmost importance to formulate relevant policies to promote the development of automotive industry. 7) The total lifetime impacts of a vehicle on environment & sustainability are various. In China, the pollution caused by automotive
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