China failing to meet 'green' goals

China’s ‘Green’ Goals Seen Slipping in Stimulus Plan, Bloomberg;  China group urges government to stick to green goals, Reuters

Chinese environmental groups are worried that the financial crisis will cause China to fall short in reaching its “green” goals.  The environmentalists are concerned that, in its efforts to shore up economic growth and jobs, the Chinese government may put the 4 trillion yuan ($585 Billion) set aside for its stimulus plan towards the poorly regulated cement, steel and coke plants, rather than towards more environmentally friendly products. 

Chinese leaders have said that their top priority is to maintain an eight percent expansion rate in 2009. To do so, the Chinese government has cut environmental funding in is stimulus plan from 350 billion yuan to 210 billion yuan—a  40 percent decrease.  The government also plans to reduce the time needed for environmental-impact assessments from  five days to 2 days.

There are some possible environmental positives, however. A breakdown of the stimulus plan provided by the Chinese National Development and Reform Commission showed that funding for technology innovation and structural adjustment has been doubled to 370 billion yuan. Funds are also going to housing construction and infrastructure projects, such as improving the Chinese electrical grid system. Additionally, China plans to shut down 25 million tons of obsolete steelmaking capacity and 72 million tons of iron making capacity. The plans for the auto industry aim to build up to 500,000 units of production capacity for electric vehicles by 2011. All of these projects are likely to have an impact on cleaning up pollution-heavy industries and improving energy efficiency.

Questions

(1) In light of the global financial crisis, is China justified in scaling back its environmental initiatives?

(2) What impact will China's lack of focus on the environment have on the rest of the world?  How should other countries react?

(3) Although China reduced environmental funding in its stimulus plan, spending in other areas may have a positive environmental impact.  Is this enough of an effort on China's part or should it be doing more?