Targeting The Environment

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In a recent announcement (reported in the FT) Premier Wen Jiabao publicly called for better environmental protection – especially better implementation from local officials – and more energy efficiency in heavy industries (specifically: power, steel, oil refining, chemicals, construction materials and metals). While the leaders make speeches, and regulators start to have an impact, the scale of the challenge is vast. China CSR notes that:

    “According to China’s top environmental watchdog the State Environmental Protection Administration, China closed down a total of 3,176 polluting enterprises amid a campaign in which 720,000 companies had been checked for their pollution discharges last year…China reported 161 pollution accidents last year and the administration suspended 163 projects that would damage the environment with a total investment of RMB770 billion.”

The Chinese government is already aware of the risks posed by environmental damage, and that China is set to become the biggest polluter in the world. As Wen’s words suggest, it is also making efforts to manage the crisis. According to a new plan (The General Work Plan for Energy Conservation and Pollutant Discharge Reduction), reported in People’s Daily, China will promote renewable energy production and efficient energy use, while providing better tax and credit support for related projects, as well as pricing mechanisms and export controls, help in the battle. The report lists the government targets, some of which are repeated here (see link for full list):

    • Solid fuel-burning electricity generating capacity will be reduced by 10 million kilowatts this year and 50 million kilowatts by 2010
    • Iron ore production capacity to lose by 30 million tons this year and 100 million tons by 2010
    • Steel production to close 35 million tons of capacity this year and 55 million tons by 2010
    • Cement production capacity to lose 50 million tons this year and 250 million tons by 2010
    • Desulfurizition facilities will be incorporated in all new solid fuel-burning electricity plants with total power-generation capacities of 188 million kilowatts and established plants with capacities of 167 million kilowatts, cutting the country’s sulfur dioxide emissions by 5.9 million tons annually.
    • Daily urban sewage treatment capacity will rise to 12 million tons this year 45 million tons by 2010 and the daily utilization capacity of recycled water will reach one million tons this year and 6.8 million tons by 2010.
    • Meanwhile, charges for sulfur dioxide emissions will double from 0.63 yuan to 1.26 yuan per kilogram in three years, while urban sewage treatment fees of no more than 0.8 yuan per ton will be implemented and rubbish treatment fees will be raised.
    • The government will ensure the urban sewage treatment rate will reach 70 percent, the comprehensive use of industrial solid waste 60 percent, and water consumption per unit of industrial net profit will drop by 30 percent.

Whether the targets can be reached is open to debate, but it is clear that Beijing is serious about the problem, and that local officials will increasingly be brought to task. Beijing is equally clear that it will not take kindly to lectures from Western powers (and this is a strong message that your author has also recently heard from a senior Chinese diplomat), and that it also needs to continue with economic growth and poverty alleviation. A Reuters article notes (h/t China Digital Times):

    “China went on the global warming offensive on Monday, unveiling a climate change action plan while stressing it will not sacrifice economic ambitions to international demands to cut greenhouse gas pollution…”The ramifications of limiting the development of developing countries would be even more serious than those from climate change,” said Ma Kai, director of the National Development and Reform Commission, which steers climate change policy.

    …The plan says wealthy powers produced most of the gases currently heating the globe and still have far higher per capita emissions than China, so they should fund clean development rather than forcing poor countries to accept emission limits.”

The politics of the matter will role on in the corridors of power. In the meantime, foreign businesses in China would do well to review their environmental credentials, as scrutiny (which has already claimed a few scalps) is only likely to increase.

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2 Responses to “Targeting The Environment”

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