Environmental protection has been a basic national policy since the 1980s. The State Environmental Protection Committee was established in 1984 and the first Environmental Protection Law formally issued in 1989. After the United Nations Conference on Environment and Development in 1992, China was one of the first countries to formulate and carry out a strategy of sustainable development. In 1993, the Environmental Resources Committee of the NPC was set up. So far, the state has promulgated eight laws for environmental protection, 14 laws for management of natural resources and 35 regulations on environmental protection. Environmental protection authorities have publicized over 100 national environmental protection regulations and more than 1,000 local ones.
Responding to stresses on natural resources caused by fast economic growth, development and urbanization, the state at the turn of the 21st century responded with a "green strategy" that includes developing a revolving economy, increasing resource-use efficiency; developing clean production, reducing pollution cost in production processes; developing green consumption, reducing ecological impact of consumption; developing new energy resources, reforming production methods, moving toward ecological industrial civilization, and creating a balanced ecological environment.
The government has gradually increased the proportion of GDP allocated to environmental protection from 0.72 percent in 1989 to 1.33 percent in 2003. Between 1998 and 2002, 580 billion yuan was invested in environmental protection and ecological construction across China, 1.8 times the total investment in this area for the 48 years between 1950 and 1997. In 2003, 136.34 billion yuan was invested in treatment of environmental pollution, 23.2 percent more than in 2002. Of the total investment, 78.53 billion yuan was used in construction of environmental infrastructure in urban areas, 18.84 billion yuan in treatment of sources of industrial pollution, and 38.97 billion yuan in environmental protection in new construction projects.
So far this century, China's environmental protection industry has grown at an average annual rate of 17 percent, far out-stripping the general economy. In 2002, the output value of China's environmental protection industry reached 220 billion yuan, compared to 4 billion yuan in 1992. At present, China's environmental protection enterprises are located mainly in more developed areas along the coast and rivers of eastern China, 6 percent being large enterprises with fixed assets worth more than 50 million yuan. Some authorities predict that this industry will maintain its fast momentum.