(note: I’ve been hopelessly neglecting the site and am prepared to post a lot of backlog stuff during this week and next.)
FOR THE OCTOBER EDITION OF NEWSWEEK SELECT AS PART OF OUR WORLD ECONOMIC FORUM PACKAGE.
The Environmental Armory
At summer Davos, politicians, innovators, businesspeople and NGOs bust out the big guns in the aim to fight pollution and mitigate climate change. How and when they intend to throw down is another matter.
By Megan Shank (Dalian)
It’s always been pretty clear that in order to mitigate climate change and to alleviate the effect of global pollution that all countries will have to play a role. But when it comes down to precisely how China should contribute, the opinions become more muddled.
Business leaders at the 2007 Summer World Economic Forum called for China’s increased investment in renewable energies, while scientists mentioned carbon caps. Technocrats framed innovation as the great competitive opportunity of our era, and legal experts demanded protection of intellectual property to encourage said trends for ecological innovation. Sociologists said that the only way for peasants to stand up against unclean industries in their regions is via empowerment through a more firmly entrenched democratic process, while NGO leaders said industry has to take on the responsibility to change. Whether it was support for increased energy efficiency or new mindsets regarding consumerism, enhanced corporate responsibility or state-led action, government officials, NGO leaders, businesspeople and innovators presented a dizzying diversity of ideas for fighting pollution and mitigating climate change.
In other words, it’s not just China’s skies, rivers and lakes that are lacking clarity – so is any straightaway answer or solution to the problems plaguing China’s environment, and, in turn, the world’s. “There is no silver bullet,” said Eileen Claussen, President of the Pew Center on Global Climate Change.
This doesn’t deter people like Zhang Yue from thinking that he might have a fairly lethal weapon against pollution and climate change. “We’re going to change the world. A company no one thought to cast a second glance is going to change the world,” Zhang Yue, President of the Changsha-based BROAD Air Conditioning Company, tells Newsweek Select.
Where Zhang Yue’s greatest concern lies is not with the possibility that his company will go on being unseen; rather, it’s with what people can’t see within the enclosed environs of their homes and offices. Pollution isn’t just an outdoor phenomenon, he says. Indoors, much of China’s air pollution is intensified, which has led to all sorts of health threats. Additionally, current inefficient use of energy to cleanse and cool air indoors is creating even greater air pollution outdoors. He outlines his BROAD’s principles as seeking to save energy while creating pollution-free air indoor environments via using only innovative means and products and observing basic moral principles like respecting intellectual property and not compromising on environmental issues. Perhaps it’s this clarity of mission that has garnered BROAD not only national recognition as a pioneering leader but also international acclaim as a green company. Zhang Yue has kept his company private to avoid investor pressure to manipulate what is already a good, green, and profitable, methodology.
But BROAD is a stand out. China currently lacks a greater framework for such clear corporate vision and distinctly ethical business policy. But that doesn’t mean there aren’t efforts underway to change that.
“It takes time to build an independent voice and to get the corporate people involved, but I think universities are a good place for it to happen,” says C.S. Kiang, Chairman of the Environment Fund at Peking University.
Three years ago, Peking University, in cooperation with Tsinghua University’s School of Business Management, sponsored a workshop on corporate responsibility. At that time, of the top 500 Chinese companies, only three participated via submitting an annual report, which details the firms’ environmental practices. This year the number is five times that amount – and although it’s still only a tiny fraction of the total companies, C.S. Kiang is optimistic about next year’s numbers.
FirstLight, a global executive education institution, has also taken up the charge of encouraging corporate responsibility as part of their training course on global enterprise. Harvey Chen, CEO of the company, sees these voluntary training courses as a way ahead, but says that in order for momentum towards real facilitation of change, the government has to provide the correct incentives.
“There has to be a structure set up to reward good behavior and punish bad behavior,” says Harvey Chen. “That’s what I see that’s missing.”
Considering that 70% of China’s energy use is by industry, and much of its greenhouse gases are generated from that use, rewarding factories and other labor-intensive institutions that cultivate efficient energy use practices is a start, says Zhang Yue. And the changes aren’t so painful.
“For example, look at this kind of room,” Zhang Yue says gesturing around a hall in the Dalian Exhibition Center. “If the air vents were put on the floor rather than on the ceiling, this room would use four times less energy to get the same job done.”
In other words, the old argument that sound ecological decisions hinder industry is moot. In its place is a new official mantra that has seemingly been taken up by several party officials who attended the forum: Further construction and business activity must be eco-friendly, but they will not impede development; technology and innovation are key to competitive strength, and good ecological practice creates an attractive arena for investment and adds to a city’s competitive advantage. In other words, saving the world will save you money.
Before his speech on Friday, September 7, Wen Jiabao, premiere of the State Council, visited various Dalian industries and schools where he stressed the importance of innovation and ecology in all development. Among the industries he visited was DHI*DCW Group Co. Ltd., a seaside heavy equipment manufacturing group. Wen Jiabao advised the company to take care of the soil, the coastline, and the sea and to make sure that resources were being used as efficiently as possible.
Possible market-based incentive programs, at the provincial level and among consumers, could be as simple as tax breaks in buying energy-efficient cars, says Zhang Xiaoqiang, vice-chairman of the National Development and Reform Commission.
“We must set up a framework to provide incentives to energy saving and clean technology,” he said at a forum meeting. Swarmed by journalists after the meeting’s conclusions and pressed for details on how it could be accomplished, Zhang Xiaoqiang spoke of how China needed to: “increase our self-reliant innovation ability and build a new innovative nation.” China needs to rely on its innovation to move forward to stimulate the economy and to serve as a custodian for the environment, he said.
But some of that innovation is already in place and simply waiting for the government to move forward. Although the 2006 Renewable Energy Law established significant goals for China’s renewable energy industry, implementation rules have yet to be set down and companies are still waiting to see the benefits. However, once companies are allowed to move forward, experts say, there’s no stopping the explosive growth of the industry. China possesses the resources, the know-how and, increasingly, the will.
Despite this encouraging trend, however, renewable energy can only provide an increment of the total energy that China requires.
“Renewable energy is an exciting industry to look at in China,” says Joanne Lewis, a Senior International Fellow at the Pew Center for Climate Change who specializes in Chinese renewable energy. “But in terms of the climate issue, in the next few years, it can only have a small dent. In the near term, for wind, solar, biomass, you’re still looking at only 1-2% of China’s overall electricity capacity.”
All the more important, says Zhang Xiaoqiang, to develop and propagate use of clean coal. He says further efforts are likewise being undertaken to create better resources of hydropower and nuclear energy as well. But, as history as shown, hydropower dams have dislocated some of the most marginalized people, and, in some poorer regions where industry goes unchecked by greedy local government, toxic nuclear waste has withered local crops and floated fish belly up in slimy rivers.
At a BBC debate during the forum, Wu Qing, a member of the board for the Beijing Cultural Development Center for Rural Women, said that without the elimination of poverty and the empowerment of democratic rights, peasants have no ability to demand higher standards from the industries that their local governments allow into a region. People need more rights in choosing their local representatives; people need a more independent press to serve as a watchdog for them, she says.
“What does democracy mean? It means the participation of people. Bottom up and top down—they should meet somewhere. But it takes time because now the leaders at the top will not accept that because our culture is family-oriented, and at home, daddy’s in control,” says Wu Qing.
Some of the kids, however, are acting up. In May, blogger Zhezi spread word about the scientific finding that the Xiamen Haicang PX plant—constructed just 4km outside of city rather than the internationally advised 70km and a producer of p-Xylene, a carcinogen known to cause fetal birth defects—could potentially harm residents. It led to a mass demonstration in Xiamen. Around the same time, a young girl, “Little Thin Girl”, posted photos on the Internet of a florescent-algae-infested Lake Tai in Jiangsu Province’s Wuxi, and the Internet bloomed. To date, neither issue has been resolved.
In his speech at the WEF, Wen Jiabao was candid about the challenges facing China, including the structural tensions, inefficient growth patterns, depletion of resources and environmental degradation. But, he claimed, to resolve them, China is:
“…putting into practice the scientific thinking on development and pursuing an innovation-based model of development. We are committed to a comprehensive, coordinated and sustainable path of development that puts people’s interests first.”
The weapons against global climate change and pollution have all been declared. Now it’s time to see who leads the battle—and how they choose to marshal it.
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