Western steelmakers have long complained that their Chinese competitors operate under a different set of rules.
Mills run by Nucor and Steel Dynamics legitimately claim to be some of the most environmentally responsible steelmakers in the world, operating as they do under a raft of US legislation that controls a wide range of water, air, noise, dust and waste control standards that few mills in the developing world are forced to meet.
These operating standards benefit the environment particularly of those working in or living near to the steel mills, but indirectly the wider global community, too. It is not that emerging markets such as China do not have environmental laws it is more that they are rarely, if ever, enforced.
Beijing has made halfhearted attempts in the past but a philosophy prevails that is expressed eloquently by a provincial official quoted in a BBC article “It just doesn’t work to sacrifice employment for the environment,” as jobs and local taxes consistently took precedence over the environment and the health of local populations.
That could be about to change. On Saturday a 103-minute documentary called “Under the Dome” was released by Chai Jing, a renowned Chinese investigative journalist. Self-financed at a personal cost of some $160,000, Ms. Chai’s exploration of pollution in China went viral within hours. According to the Guardian newspaper since its release online on Saturday, “Under the Dome” has notched up 100 million views on major Chinese video portals such as Tencent and Youku.
It has also prompted 280 million posts on Sina Weibo, a microblogging site. With just one week to go before China’s annual parliamentary session begins pollution has been catapulted to the center of both public and political attention at a time when Beijing needs all the public support it can get to enforce new environmental laws they passed at the beginning of 2015 allowing them to impose unlimited fines and even prison sentences on officials who fail to conform with the new environmental standards.
A Reuters article reports on inspectors from China’s Ministry of Environmental Protection (MEP) who last week summoned mayors from the cities of Linyi in the eastern province of Shandong and Chengde in the northern province of Hebei, urging them to crack down on firms that have violated environmental laws.
Chinese Pollution Covered Up
Unsurprisingly, 13 of the 15 enterprises inspected in Linyi had violated the required standards. Most were steel and coke plants, with some found to have provided fake environmental data Reuters said. Still, passing laws and enforcing laws are two different things in China. Beijing has made efforts to clean up air and water pollution before, but it is frequently thwarted by local officials.
With a groundswell of public opinion behind the government, Beijing will be emboldened to take more radical action. The documentary apparently had tacit approval from the authorities with early drafts being approved at least in text form. The website of the government newspaper, People’s Daily, was one of the first to post “Under the Dome.” By Sunday evening, however, popular Chinese websites had removed prominent headlines and links about the documentary from their front pages.
Since the overwhelming level of public reaction the authorities have backpedaled possibly shocked by the strength of feeling generated, but the new minister of environmental protection, Chen Jining, praised the video and sent a text message to Ms Chai thanking her for raising the public attention about environmental issues. He told Chinese reporters at a news conference in Beijing on Sunday that the documentary reminded him of Carson’s “Silent Spring,” which on publication in 1962 sparked a furor about excessive use of pesticides the Guardian reported.
Reuters suggests Chinese steel mills are now paying on average $26 per ton of steel to comply with environmental guidelines. Clearly that does not apply to those in Linyi and we suspect many others, but maybe times are changing. Rigorously applied environmental standards would have the benefit of closing less-efficient steel plants, reducing endemic overcapacity, improving the health of local populations and gradually moving Chinese steel producers onto a more level playing field with their western counterparts.