China to act on pollution, emission

Updated: 2007-04-28 06:33

BEIJING - Premier Wen Jiabao pledged Friday to help clean China's air and water and combat global warming by phasing out tax breaks and discounts on land and electricity for highly polluting industries.

"More work on energy conservation and emissions reduction is urgently required to deal with global climate change," Wen said. "Our country is a major coal producer and consumer, and reducing polluting emissions is a responsibility we should bear."

China's 3-decade-old boom has left some of its waterways and coastlines polluted by industrial and farm chemicals and domestic sewage. In 2000, China accounted for 15 percent of the world's greenhouse gases, second only to the United States' 21 percent.

Wen said the reductions would be difficult to achieve but the government would begin with its six dirtiest and largest energy-consuming industries, including electricity, steel, non-ferrous metals, construction, petroleum and chemicals.

"We must clearly recognize that the situation the nation faces regarding energy conservation and emissions reduction is still quite grim," Wen said at a meeting of other top government leaders, in a speech posted on the government Web site.

Wen called for energy savings of 50 million tons of coal equivalent in the power industry and 20 million tons of coal equivalent in 1,000 state-owned major industrial enterprises this year.

This was part of an overall effort to reduce energy consumption per unit of gross national product by 20 percent during the 2006-2010 period and to cut emissions of key water and air pollutants by 10 percent over the same period.

He also noted that China has failed to meet earlier goals to reduce emissions and conserve energy.

"This year is crucial. If we can meet our energy savings and pollution reduction targets for this year it will form a good base as we go forward," Wen said.

"If we cannot meet this year's target, this will greatly increase the pressure on our work in the following three years."

In his speech, Wen took aim at local governments that routinely offer free or cut-rate real estate and utilities to developers looking to set up job-creating businesses, such as steel mills or chemical plants. The premier said the government would "clean up and rectify preferential policies that give land and electricity discounts or tax breaks to energy-intensive or highly polluting industries."

He didn't lay out further details of the plan or say when it would be implemented.

Despite such central government mandates, Beijing often has difficulty ensuring that conservation initiatives are enforced at the local level, where many officials reap the rewards of China's rapid industrialization at the expense of the environment.

"The question is how are they actually going to implement it?" asked Elizabeth Economy, an Asia specialist at the Council on Foreign Relations in New York. "What exactly will they put in place to make it more difficult for local bank officials to approve those local steel plants, small coal mines and concrete factories?"

Wen also said China should work harder to create a system whereby polluters pay for environmental damage they cause, and enterprises investing in clean energy are rewarded. He also called for continued price reforms on natural gas, heating fuel and water to encourage energy conservation, without giving a timeframe for price increases.

China is a signatory to the Kyoto Protocol on reducing greenhouse gases, but as a developing nation it is exempt from its mandatory cutbacks.

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