The Chinese economy has experienced anunprecedented 30-year period of economic growth anddevelopment that has delivered enormous social and economicbenefits to the people but has had seriously adverse andcontinuing effects on the state of the environment. Thegovernment is well aware of the problem. Over the last fiveto ten years, environmental objectives have becomeincreasingly important in priorities set under successivenational five-year plans. To address these problems, thegovernment has provided increasingly large infusions ofcapital and implemented a series of administrative reforms.Notwithstanding all these actions, the state of the nationalenvironment continues to deteriorate, and further action isclearly needed. This policy note focuses particularly oncontinuing issues related to the operations of the Ministryfor Environmental Protection (MEP), including the legalframework under which it operates and its operationalrelationships with other agencies at the national level andwith its counterparts at lower levels of government. Thisfocus is justified given that MEP's effectiveness iscritical to the effectiveness of the government'soverall environmental objectives. Without an effective MEP,the other elements necessary for China'senvironmentally sustainable development will not be able toachieve these national goals.