1300 Annecdotes Make it a Trend. Clean Up or Close Up

Tuesday, October 9, 2007 10:52

For those of you loyal readers (and RSS readers), you will remember my previous posts entitled Tianjin’s New BinHai Plan for Chemical Industry and Want to Invest in Suzhou? Evaluate Your Impact where I discussed how the degrading environmental conditions were changing the on-the-ground conditions for business in China.

That during my trips and negotiations, my clients were being pushed to submit their EVA ahead of meetings (Kunshan wouldn’t even take my calls once I said the word “chemical”), and leaders were openly admitting that while it was once okay to look the other way.. those days were gone

Gone are the days were one could simply show up, wave some money in front of an official, and have the EVA (Environmental Assessment) form overlooked. Gone were the days where a multinational could promise jobs and tax base to get a more favorable reading on an environmental reading.

So, when I saw the article In China, a green awakening on MSNBC, I knew I had to write a quick follow up to those posts. After all over 1300 factories in the Wuxi area have been shut down in the last 3 months.

1340 to be exact.

According to Mr. Liu of Wuxi’s Environmental Protection Bureau:

The blue-green algae gave us a warning, a shock

Now, I am not sure if any of those factories were foreign (I am sure if one was it would have been in the press), but no doubt some of those factories were serving the resident foreign factory community.. which impacts business.. but for me the most important part of this story is their quote of Elizabeth Economy of CFR when she says

“the commitment, the profile, the energy behind the state’s environmental protection efforts far exceeds anything we’ve seen in China’s history.

“It’s not about new ideas, but about enforcement. . . . What is changing are the incentives or disincentives.”

and I cannot agree more. In the last several months (as I indicated above), I have been speaking to many who are apart of this process, and they all are saying the same thing.

The game has changed. Clean up or Close up.

Shameless plug: for more on environmental coverage, I encourage you to go to Crossroads (my other blog) where we (There are several active writers) are covering where China and corporate responsibility meet.

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9 Responses to “1300 Annecdotes Make it a Trend. Clean Up or Close Up”

  1. Fons Tuinstra says:

    October 9th, 2007 at 8:53 pm

    I’m sure they got their wake-up call in Wuxi alright, and in terms of ideology the environment is of course high on the agenda, just like 30 other items. But if you see how important reports (green GDP, environmental casualities) got dumped, I do wonder how deep this goes. On a local level governments have always been good is saying one thing and doing the other.

  2. Rich says:

    October 9th, 2007 at 9:12 pm

    Hi Fons,

    How are you doing these days? How is the speaker series going?

    My feeling is that the change is real because the fire is very hot. Unlike before, the public pressure is very high in affected areas… Wuxi, Suzhou, and other areas have seen stark changes in public senitment, and I think that change has lit the fire.

    The October meetings are sure to see a strengthening in the environmental policies as well.

    No doubt there will be those who look for loopholes, but as I was discussing with people yesterday. A loophole today is a noose tomorrow.

    Hope all is well

  3. Fons Tuinstra says:

    October 10th, 2007 at 1:04 am

    We should catch up soon, Rich. You are in my databased to be added to the currently activie speakers and things are going quite ok (although we have no real benchmark to compared it with.)
    China is a marvelous country for window dressing; one of my next columns is going to be on priorities of the central government that have not survived the pressure from lower levels (although Wuxi might be an exception).

  4. Rich says:

    October 10th, 2007 at 1:40 am

    Hi Fons.

    That sounds like an interesting column. My honest opinion (and I rarely comment publicly) is that there will be a centralization of power and authority come Oct 15. There are some who are very frustrated by policies that are strong long term being ignored for a short term gain. Look at the timing of the slavery scandal that coincided with new labor law, and the water issues in Wuxi that coincided with the empowerment of SEPA.

    Happy to chat about joining the troupe! You have an excellent group so far, and I just hope that I make the JV cut.


  5. Fons Tuinstra says:

    October 10th, 2007 at 7:34 pm

    Just like everywhere, the power is where the money is. The central government is hopelessly underfunded and relies on local and other government entities (where the money is) for support. They are not giving away their money and power.

  6. China Economist says:

    October 11th, 2007 at 12:14 pm

    Interesting post. I have written a small blog piece on a couple of the articles you have written over at China Economics Blog.

    The post can be read here.


    It is interesting to get the micro take on what the world generally considers a macro issue.

  7. Rich says:

    October 14th, 2007 at 4:10 am

    china Economist.

    This is one of those micro issues that is becoming macro very quickly. In the past it took a flare up to create any kind of enforcement, but for many of the developed 2nd tier cities I speak to they are now becoming very proactive.

    Hope all is well

  8. Greener China says:

    November 1st, 2007 at 11:08 am


    I thought you might find this site interesting: http://www.ipe.org.cn. It’s the Institute for Public & Environmental Affairs, and they publish a publicly available database that lists factories that have broken local, provincial and/or national environmental regulations. I head up a group in the U.S. that is trying to get U.S. firms that source in China to look at this database and use it to either weed out polluters or pressure guilty suppliers into cleaning up. This sounds like it might be up your alley.

  9. Rich says:

    November 1st, 2007 at 9:29 pm

    Hi Greener China.

    Thanks for the suggestion. Please tell us more about what you are doing, and check out our sister site Crossroads (www.china-crossroads.com) as we are covering more of the greener (and browner) there.

    Thanks for putting us onto IPEA. I will make sure and check it out this weekend.