Enabling Nature-Positive Growth in the People's Republic of China’s Yangtze River Economic Belt and Beyond

Project Result / Case Study | 1 June 2020

In the People’s Republic of China’s Yangtze River Economic Belt, a new programmatic approach has been adopted to achieve water security and green development, and increased resilience of the environment and people.

威廉希尔体育The novel coronavirus disease (COVID-19) global pandemic is a catastrophic reminder of the fragility and interconnectivity of human-nature systems on planet earth. 

“Protecting regional public goods and respecting biophysical boundaries is no longer a choice, but a necessity to rebalance global human-nature systems and enable a greener growth model,” says James Lynch, Director General of the Asian Development Bank’s (ADB) East Asia Department.

Like many countries in Asia and the Pacific, the People’s Republic of China (PRC) has long faced a balancing act between economic development and ecological protection. 

威廉希尔体育PRC President Xi Jinping stressed that the country should focus on rural vitalization through green development as the main avenue to reach long-term growth with “rich economic dividends.”

Only through Integrated watershed and flood risk management can we make the region safer and more prosperous over the long term.

Qingfeng Zhang, Director, Environment, Natural Resources and Agriculture for East Asia, Asian Development Bank

威廉希尔体育“Rapid economic growth has led to significant improvement in human well-being and quality of life in the PRC,” says Qingfeng Zhang, ADB Director, Environment, Natural Resources and Agriculture for East Asia. “However, increasing urbanization, more intense agricultural production, and industrial expansion have had significant impacts on water resources, posing wider health risks for the population, land degradation and biodiversity loss. Weak institutional coordination, lack of integrated planning across rural development and natural resources management, and economic disparities between the provinces have only increased the pressures on already fragile ecological systems.” 

Yangtze River Economic Belt: a microcosm of the People's Republic of China

威廉希尔体育In this respect, the Yangtze River Economic Belt (YREB) is a microcosm of the PRC. Home to 40% of the country’s population, it contributes 45% of gross domestic product and holds 36% of the country’s water resources. The Yangtze itself is the PRC’s longest river, providing drinking water to about 400 million people and accounts for 20% of its total wetland areas.

Based on its demographic and geographic importance, the PRC government has earmarked YREB as one of the three key growth engines to ensure the PRC’s future economic development. At the opening session of the National People's Congress in Beijing on 22 May 2020, the Premier Minister Li Keqiang highlighted the need for advancing the well-coordinated environmental conservation in the YREB.

The basin is marked by widely contrasting geographies—ranging from steep and high mountains to valley bottoms near rivers—but despite its diversity, the subregion’s commonality includes unsustainable agricultural production systems and practices, with inefficient use of land and water resources, soil erosion, excessive fertilizer and pesticide use, and outdated or lack of infrastructure. 

The difficult terrain, inadequate land management practices, and limited financial opportunities have caused widespread environmental degradation, exacerbated by a changing climate and extreme weather events.

Addressing the complex environmental, social, and economic challenges and opportunities in such a diverse subregion requires innovation and systems-thinking. The solution lies in the new programmatic approach that has been adopted to achieve water security and green development, balanced natural resource management, improved food security, and increased resilience of the environment and people. This is anchored on enhanced cooperation and coordination within and between provinces beyond administrative barriers, corroborated by good governance and integrated planning.

Urban rural water integration in Dengzhou City, Henan province. Photo: Rabindra Osti

ADB's support to the Yangtze River Economic Belt

Taking such a programmatic approach, ADB has invested about $2 billion to support the YREB master plan aimed at addressing complex socio-ecological challenges. Knowledge has been a core element to inform policy research for integrated landscape planning of water, land, forest conservation, and river ecological protection. 

“Only through Integrated watershed and flood risk management can we make the region safer and more prosperous over the long term,” says Mr. Zhang. “The geographic concept of a ‘belt,’ encompassing economic, social and ecological multidimensional linkages, is a step beyond traditional watershed catchment management toward a more holistic protection of public goods, such as water resources, ecosystems, marine fisheries, pollution control, ocean health, biodiversity conservation and climate change.”

The Yangtze River Economic Belt can serve as a model for addressing environmental, social and economic issues in a more  integrated and holistic manner. Protecting vital public goods, and the planet’s health at the same time, is now more important than ever.

James Lynch, Director General, East Asia Department, Asian Development Bank

Since February 2018, the central government agreed to reward provinces and cities implementing trans-boundary watershed eco-compensation schemes. ADB assisted in the preparation and implementation of the first two trans-provincial eco-compensation schemes: Xin’an river eco-compensation covering Anhui and Zhejiang provinces, and Chishui watershed cutting cross Yunnan, Guizhou and Sichuan provinces. Based on policy recommendations from ADB, a Yangtze river protection law will speed up institutional reform to promote long term financial sustainability and strengthen the linkage between environmental protection and livelihoods.

To bring the private sector into the natural capital agenda, the “Natural Capital Lab” Initiative, announced at an international eco-compensation conference in December 2019, has introduced financial innovations to support green businesses, such as agricultural value chain development, eco-tourism and eco-product development. Still at an early stage, the lab aims to establish strategic partnerships with key stakeholders to catalyze financial and technology applications for supporting green development and natural capital investments.

Lessons from the Yangtze River Economic Belt experience

威廉希尔体育At least three lessons can be drawn from the YREB experience. The first is that complex problems cannot be addressed with rigid solutions, but require a flexible and agile approach. “Designing project clusters and strengthening institutional coordination across provincial boundaries, and traversing geographic scales and sectors, can improve long-term policy coherence and on-ground impacts,” says Suzanne Robertson, a Principal Agriculture and Natural Resources Specialist at ADB. 

The second is that landscape approaches—integrated projects within given spatial and territorial areas—are needed to deliver co-benefits across sectors (i.e., water, agriculture, fisheries, recreation, and tourism).

Third, doing more with less resources requires stronger collaboration between the public and private sectors. Innovative financial products are needed to boost investments in multi-sector and multi-purpose projects, including investing in natural capital and sustainable farming, can leverage private sector investments with multi-stakeholder transactional mechanisms.

“The YREB can serve as a model for addressing environmental, social and economic issues in a more integrated and holistic manner. Protecting vital public goods, and the planet’s health at the same time, is now more important than ever,” says Mr. Lynch “Promoting greener and healthier growth models can recalibrate human-nature systems and interrelationships, which ultimately hold the key to a healthier and more sustainable future.”