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China is making progress toward its plan to take environmental factors into account when determining the gross domestic product, or GDP, in a bid to ensure a sustainable economic and social development.

Southwest China's Chongqing Municipality, the trial city for developing the "green" GDP system, has recently had its research outcome of a cost accounting approach for natural resources and environment pass experts appraisal.

According to Professor Lei Ming with the Guanghua Management Institute of the Beijing University in China's capital, the "green" GDP will be an important indicator to measure how harmonious the relationship is between economic growth and natural environmental protection.

Traditional GDP statistics failed to take into account the affect of industrial pollution and consumption of water resources on the domestic economy, said Qin Yao, head of the research team for the "green" GDP accounting approach.

The failure to deduct environmental deterioration caused by industrial pollution and cost of water resources consumption from GDP deprived the traditional indicator of the ability to objectively reflect whether and how a local economy is sustainable, Qin added.

According to Qin, in 2001 the National Bureau of Statistics designated Chongqing as the only city in the nation to experiment with resources cost accounting for GDP. The city has since studied data collected from 1,415 local enterprises and non-profit institutions. Based on the study, an initial feasible "green" GDP accounting approach has come into being.

It is imperative for China to establish a new "green" GDP growth assessment system, says Qian Yi, academician of the Chinese Academy of Sciences.

The incumbent leadership of China has kept underscoring the value of scientific development since it took office. A "green" GDP growth accounting approach is seen as part of efforts to realize a scientific development of an economy and a society.

(China Daily May 14, 2004)