China / Society

Need seen for policies to encourage green investment

By Wu Wencong (chinadaily.com.cn) Updated: 2014-05-05 19:08

Better policy structure should be set up to stimulate a sustainable interest in environmental protection-related investment from the market, according to environmental and economic experts.

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"A great demand for environmental protection in the near future does not guarantee similar demand from the market. Policies must be set up to help create the market demand," said Yuan Qingdan, deputy director general of the policy research center for environment and economy affiliated with the Environmental Protection Ministry.

He gave the example of how governmental policies help regulate the environmental market based on his own experience in Singapore in 2013. He said that local government there hands out a subsidy of 300 yuan ($48) to private companies for treating one metric ton of trash, while reclaiming the electricity generated during the treating process.

"The policy helps create a stable trash-processing market, and by taking back the electricity, it prevents private companies from burning coal instead of trash to generate more electricity for profits," said Yuan.

Ma Jun, chief economist at the People's Bank of China Research Bureau, said the ideal situation requires an annual investment of 2 trillion yuan in the environmental market to solve the pollution problem, but the real investment is nowhere near the request.

"The reason is that governmental policies did not build up an effective stimulation system," he said. "Polluting projects are still making much more money than green industry, which makes capital investors unwilling to invest greenly."

To solve the issue, Ma highlighted the method to help customers raise their social responsibility, which he said works in a similar way to subsidizing green industry.

For example, he said, electric car users in the United States like to put stickers on their car windows that read "I saved the globe". By enjoying the admiration of others, they become more-stable green customers.

Both Yuan and Ma were speaking at a panel discussion organized by the Cheung Kong Graduate School of Business in Beijing on April 29.

Suggestions given by the experts include building up a new system to let consumers bear more responsibility for polluting the environment, such as paying more for trash treatment and sewage processing; setting up a feed-in tariff system that can last for at least two or three years; and applying a mandatory environmental insurance system in more areas such as the petrochemical industry, coal chemical industry, steel industry and gas exploration industry.

wuwencong@chinadaily.com.cn

 

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