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Unfair Competition

Friday, 8 June, 2007

in World

Prosecutors have charged environmental activist Wu Lihong with extortion from industrial plants that he accused of polluting Taihu Lake in eastern China’s Jiangsu province, state media said on Wednesday. The prosecutors in Jiangsu’s Yixing city accused Wu, who was once nominated as one of China’s top 10 environmentalists, of extorting 55,000 yuan (6,875 dollars) by threatening to expose the plants’ pollution, the official Xinhua news agency said. The agency quoted prosecutors as saying Wu’s diary listed “blackmail targets and showed amounts of money he had planned to extort from each factory or enterprise.

The Yixing court had not set a date for the trial of Wu, 39, who had fought for years against the pollution of Taihu.
Water supplies from the lake had to be cut to 2 million people in nearby Wuxi city in late May because excessive pollution had promoted the growth of a pungent blue-green algae.
After police arrested Wu in mid-April, a friend said police had initially accused him of contacting foreign media (what an allegation!)
Wu had worked for years to uncover illegal water pollution by businesses and had denounced the inaction of corrupt officials. He has
repeatedly been arrested and threatened. Wu grew up beside Taihu, the third-largest freshwater lake in China, which is located in the Yangtze Delta plain on the border of Jiangsu and Zhejiang provinces.

He began lobbying the central government early last year, arguing that Yixing had failed to meet environmental protection standards Despite his protests, the national environmental protection bureau awarded the title of model city to Yixing in November. Wu took scores of photographs and nearly 100 samples of polluted water, and he and his friend had planned to take their case to a Beijing court on April 22, World Earth Day. Relatives and a lawyer were not allowed to meet Wu after his arrest on April 13. Wu’s wife, Xu Jiehua, said Chinese authorities had advised her not to have any more contact with foreign media.

They warned me that it would be better if I didn’t speak any more to foreign journalists or it could hurt my husband“, Xu said.
Taihu is known for its fish industry and as a tourist attraction because of its scenic beauty, but it is also highly polluted.
The lake provides much of the drinking water in the thickly populated area despite it worsening pollution, caused by discharges of wastewater and from factories.

We hope that, sooner or later, China will realize that environment is something you have to take into account. Today, chinese goods are cheap also because their manufacturing costs don’t consider negative externalities, like pollution and its by-products, like cancer. This is a kind of unfair competition, and arises from imperfect property rights enforcement. This is the difference between a free market and a state-regulated capitalism like the chinese one, a very toxic oxymoron.

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