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If natural resource exploitation is not figured in as part of the total costs of production, processes which generate a large amount of pollution will appear cheaper that those which don't.
Commentary: Polluting its way to inflation
"China is waking up to the need to normalize pollution costs. On May 15, the South China Morning Post reported that about 2,000 Hong Kong-owned factories operating in Southern China's Pearl River Delta face closure or relocation because of pollution or environmental hazards they pose."