"The year 2006 was the most serious year for China's environmental situation," Pan Yue, a vice minister of the State Environmental Protection Administration said in a statement on the watchdog's website.

"Environmental problems have already become the major bottleneck constraining China's economic and social development."

Pan said China suffered 161 severe environmental pollution incidents last year, without detailing what they were.

China also failed to realise its 2006 goals of reducing energy consumption per unit of gross domestic product (GDP) by four percent and cutting emissions of pollutants by two percent, he said.

Pan did not say how badly the targets were missed, but other government reports showed that China actually increased both energy use per unit of GDP and pollution emissions during the first six months of the year.

Due to the deteriorating environment, the environmental watchdog last year stopped or delayed the approval of 163 projects that would have had a serious impact on the environment, Pan said.

Investment into the projects amounted to 770 billion yuan (98.8 billion dollars), with more than half the projects dealing with high energy consumption and polluting industries such as steel-making, coal-fired power plants and petro-chemicals, he said.

However, it was unclear whether these projects would continue to be pushed forward by other ministries that have traditionally been more powerful than the environmental administration.

In June last year, the administration said environmental degradation in China was out of control amid the frantic economic growth in the nation of 1.3 billion people.

"The trend of increasing environmental degradation has not been effectively controlled," the administration said in its first China Ecological Protection report.

A report in the China Daily newspaper Wednesday gave more details on the failure last year to meet environmental targets.

Only six provinces, regions and municipalities out of the nation's 31 major administrative zones fulfilled their energy efficiency and pollution emission goals last year, the China Daily said.

Citing the National Development and Reform Commission, China's planning agency, the paper said energy consumption in the nation actually increased by 0.8 percent per unit of GDP during the first half of the year.

In November, the environmental administration said China produced more than 12 billion tons of industrial waste-water in the first half of 2006, up 2.4 percent from the previous year.

The watchdog also said half the country's rivers and more than 70 percent of rivers and lakes were polluted, while underground water supplies in 90 percent of Chinese cities were contaminated.

The administration said in another earlier report that more than half of China's cities were suffering serious air pollution, largely caused by coal burning and the increasing use of cars.

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