Anyone familiar with life in China’s big cities will not be surprised by the report’s findings – atmospheric pollution has been a problem for years but the report highlights that water pollution is also a major problem. More than 209bn tons of waste-water were discharged into rivers and lakes in 2007 twice the government’s earlier estimates. Fearing social unrest if environmental problems are not tackled, the authorities are discussing taxes and other forms of control to get to grips with the situation.
Zhang Lijun, vice-minister of environmental protection said in a China Mining report to be wary of industrial projects that involve heavy metals, such as lead, mercury, cadmium, chromium and arsenic, suggesting new projects may not be approved or require expensive control procedures. The census revealed six industries including power generation, heating, minerals and non-ferrous metal smelting account for 88.5% of total sulfur dioxide emissions. China discharged 23.2m tons of sulfur dioxide in 2007 compared to less than 9m tons in the US, and 19.21 m tons of nitrogen oxides, respectively causes of acid rain and global warming. The US halved sulfur dioxide emissions by instigating an extremely effective cap and trade program back in 1990 following the Clean Air Act and Acid Rain Program. It will be interesting to see if China relies on the markets by doing the same or whether they go for centralized control and issue targets and deadlines.
A China Daily report on the census further revealed industry discharged 49.15 m tons of industrial waste and 39,400 tons of hazardous industrial waste in 2007 along with 900 tons of heavy metals. The shock to the authorities has been the level of agricultural pollution caused by over and indiscriminate use of fertilizers and pesticides but the issue for the metals industries will come more as a result of air and water pollution curtailing production as it did last year with lead producers or in declining planning applications for new facilities. Non-ferrous metal smelting has already been identified as a major source of sulfur dioxide either directly from the smelting process or indirectly from the massive amounts of power needed for processes such as aluminum and zinc production. Most of that power is generated from coal-fired power stations and on the whole is dreadfully inefficient from an environmental standpoint. Taking data from the US Energy Information Administration as a framework where Co2 levels are measured for the US and China we can see that while the Co2 emissions per capita are high for the USA at 19.2 mt/person compared to 4.9 in China that is due to the majority of the population in China living at a subsistence level. But the Co2 intensity, measured as emissions per unit of GDP, are 880 mt Co2 per million dollars of GDP in China compared to 443 in the USA, illustrating how incredibly polluting Chinese industry is per unit of GDP produced. As the standard of living rises in China the emissions per capita will rise unless the authorities take action and they know that. This more than tightening of capital and bank loans could provide the brake to relentless Chinese investment in primary industries. With a new five-year plan (now termed guideline) about to start from 2011, expect pollution and the metals industry to appear much higher up the list of priorities than it has in the past.