Environmental Protection Industry to Become China's New Economic Growth Point

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Last updated at: (Beijing Time) Friday, March 01, 2002

Environmental Protection Industry to Become China's New Economic Growth Point

In the next few years, China's environmental protection industry will face unprecedented development opportunities and become a new growth point of China's national economy, official sources said Thursday. Chinese government has outlined a goal for ecological construction and environmental protection in its 10th five-year plan (2001-2005) for national economic development and social progress.

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Goal for environmental protection outlined

At a two-day meeting on Sino-Japanese cooperation in environmental protection, Xie Xuren, vice-minister in charge of the State Economic and Trade Commission (SETC), said the Chinese government has outlined a goal for ecological construction and environmental protection in its 10th five-year plan (2001-2005) for national economic development and social progress.

The goal is to stop further ecological deterioration in China in five years, to improve the environmental quality in its cities, reduce the emission of pollutants by 10 percent from 2000 onwards, and make progress in conserving and protecting natural resources.

To reach the goal, China will greatly develop its environmental protection industry. It is estimated that about 700 billion yuan, or 1.3 percent of the GDP, will be put into the country's environment sector between 2001-2005, of which 550 billion yuan will be used for air and water pollution prevention and treatment.

With the implementation of the plan and with Beijing's preparations for the 2008 Olympic Games, China will have a rapidly growing market in environmental protection, Xie said.

Environmental protection industry to boost economy

During the five-year period, the environmental protection industry will give priority to the development of advanced technology and equipment and materials for environmental protection, e.g. for desulphurization and exhaust treatment. It will also give priority to the comprehensive utilization of resources, and to the development of information, consultation and technology services, according to Zhai Qing, deputy director of the Department of Resources Conservation and Comprehensive Utilization under the SETC.

Zhai said the output value of the environmental protection industry is expected to reach 200 billion yuan by 2005, with an annual growth rate of about 15 percent.

The development of China's environmental protection industry will not only upgrade the overall level of China's domestic businesses in this field, but also provide a huge market and many opportunities for foreign companies. The Chinese government is endeavoring to establish a diversified investment and financing mechanism for the industry and to make and implement policies to encourage businesses with multiple ownership to invest in the industry.

The Sino-Japanese meeting was co-organized by the SETC, the Japanese Ministry of International Trade and Industry, and the Japan-China Association on Economy and Trade. It was attended by over 200 delegates, who exchanged views on the two countries' current environmental protection situation, relevant stipulations and policies, and the cooperation between the two sides in this area.

China's Environmental Protection Industry Turned out a New Spotlight in Economic Growth

The output value of China's environmental protection industry increased by 25 folds in 10 years time according to news from China Economic and Trade Commission, with a yearly output value hitting 10 million yuan, making the industry a new spotlight in China's economic growth.

According to statistics, by 2000, more than 10,000 enterprises engaged in environmental protection throughout the country had an employment of 1.8 million workers with the output value reaching 108 billion-yuan. Compared with that of 10 years ago, enterprises engaging in environmental protection increased by four folds and an involvement of workers rose by six folds, while the annual output value outstripped by 25 folds. Full Story

Prospects of China's Environmental Protection Industry

Companies hope that the state should manage effectively the Chinese environmental protection industry. There is already awareness that this industry needs to be developed, the catch will be in the implementation. The leaders of the Chinese environmental protection industry expect that the appropriate departments of the Chinese government will plan the development of the environmental protection industry, set industrial standards, regulate market behavior by the companies in the industry.

Companies hope that the state will provide policy support. The heart of policy support is capital, tax policy and capital to support the development of the industry. The capital problem is mostly a question of establishing channels for loans. Capital would be used for new technology development, for new, improved and expanded plant, and for improving technology.

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