China’s looming Olympics disaster

March 19, 2008 at 1:11 pm | Posted in china | Leave a comment
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By Jim JubakOn March 10, Haile Gebrselassie, the world record holder in the marathon, ruled out competing in the race at August’s Beijing Olympics. The city’s notoriously bad air pollution posed a threat to his health over the 26.2-mile course, the Ethiopian runner said.

It says a lot about the disaster that’s unfolding for the Beijing games that the withdrawal of an Olympic favorite caused hardly a ripple. And why should it when bigger stories are brewing? It’s possible that:

  • A forced shutdown of Beijing’s factories and power plants during the games will throw China into an economic downturn.
  • Diversion of safe food to the Olympic Village will cause food riots elsewhere in China.
  • The transfer of 80 billion gallons of water — equal to the annual water consumption of Tucson, Ariz., a city of 535,000 — from Shaanxi and other provinces in northwestern China will shut down factories and agriculture in the region.

Yes, the Beijing Olympics, which were supposed to showcase China to the world, are still likely to provide exactly the kind of prestige-building extravaganza that the country’s leaders had hoped for. But domestically, the games are quickly turning into an economic and political disaster. Once upon a time — maybe six months ago — investors (including yours truly) looked on the Olympics as a guarantee that China’s stock market and economy would keep chugging along through the summer. “Safe until August” was the mantra.

Now, it increasingly looks like the games themselves could be the catalyst for a significant downturn in China’s stock market and economy.

Steps haven’t been enough

Observers already knew that China was serious about cutting air pollution in Beijing and that, if necessary, the government would shut down factories and power plants. Pollution had been one of the reasons China lost its 1993 bid to host the 2000 Olympics, and this time around, the country promised the International Olympic Committee that it would clean up Beijing’s act before the games.Officials converted coal-fired furnaces to natural gas. Factories have been relocated to the suburbs. Millions of trees have been planted to break the winds that blow dust in from the plains north and west of the city. Older taxis have been replaced with 80,000 newer models that produce less pollution. Heavy trucks are permitted to enter the city only at night. The city expanded its subway system and built a rail line to connect the airport to downtown.

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