According to a new study about China's environmental outlook, the country has many unacknowledged signs of improvement.

The 2006 Index of Leading Environmental Indicators, released by the Pacific Research Institute (PRI) and the American Enterprise Institute (AEI), provides an annual review of the positive trends occurring in key areas of the environment including climate change, air quality, water quality, toxic chemicals, and biodiversity.

"Nowhere is pessimism about the world's environmental prospects greater than in China," said Dr. Steven F. Hayward, author of the Index, senior fellow at PRI, and F.K. Weyerhaeuser Fellow at AEI. "Although environmental trends in China are serious and deteriorating, some unappreciated signs of improvement are appearing."

China's gains can be attributed to a willingness to replicate environmental laws that resemble landmark legislation introduced during the 1970s in the U.S. and Europe. China's State Environmental Protection Administration reports that spending for environmental projects is increasing about 15% a year.

China has created its own version of the American NEPA (National Environmental Protection Act), requiring construction projects to perform an environmental impact assessment as part of the planning and building permit process. As a result, in 2004 over 320,000 construction projects went through the EIA (Environmental Impact Assessment) review process.