To: Wharf Rat who wrote (10226 ) 3/5/2007 9:56:30 PM From: Wharf Rat Read Replies (1) | Respond to of 36918 China goes for green before growth Rowan Callick, China correspondent March 06, 2007 CHINA has announced a sweeping program to shut some of its most polluting factories in a green initiative that is likely to cut its economic growth this year to 8 per cent from 10.7 per cent last year. Premier Wen Jiabao used his state of the nation address yesterday to unveil environmental initiatives that would close a massive section of China's old heavy industry. The initiatives also ban the wasteful use of land, including building golf courses and free-standing homes. Launching the annual session of the National People's Congress, Mr Wen said future economic growth would hinge on "environmentally friendly industries". Projects would be assessed for "energy consumption and environmental impact". Those that failed to meet such standards would be stopped. Mr Wen said China would close "backward" iron foundries with a production capacity of less than 30 million tonnes and "backward" steel mills that could produce 35million tonnes. Mr Wen said "key energy-saving projects" would be introduced in industries including steel, other metals, coal, chemicals, building materials and construction. China is the world's second biggest emitter of greenhouse gases. The International Energy Agency expects it to overtake the US by the end of the decade. Energy consumption per unit of gross domestic product fell for the first time last year, by 1.2 per cent, but this was still well short of the 4 per cent target. A major reason is that it is by far the world's top coal producer and consumer, using 42 per cent of the world's thermal coal for power and 48 per cent of its coking coal for steel. Taiyuan, the capital of Shanxi, where much of the country's coal is mined, has the world's worst air pollution. The net result of China's environmental moves could be a plus for Australian exporters. In January, China became a net importer of coking coal for steel-making, and Australia's coking coal - along with iron ore by far the biggest export to China, worth $6.77billion last year - is much cleaner than the local product. Australian iron ore and coal are used overwhelmingly by China's top 10 steel-makers, who are being given a mandate to take over many of the 300 smaller mills using mainly local inputs. These include ore with a 30per cent iron content, whereas Australia's has 66 per cent. Australian enterprises are also expected to have opportunities in products such as clean-coal technologies, "green buildings" and solar technology. Mr Wen said China would strive to reduce its "excessively large" trade surplus, by limiting its exports of products from high-energy consumption or which created pollution. It would boost imports of energy, raw materials and advanced technologies. The focus of China's "new path of industrialisation" would be developing the service sector. "We should avoid seeking only faster growth," he said. Mr Wen said China's drive for a cleaner environment would "give full play to the role of the market", including through charging companies for pollution emissions. Sulphur dioxide discharge rose 1.8 per cent last year, down from 13.1 per cent in 2005 but still well below the target for cutting pollutants by 2 per cent. Conserving land use was vital for "the survival of the Chinese nation", Mr Wen said. "We cannot afford to make a historical mistake that cannot be corrected, one that will seriously harm future generations. "We cannot cross the line and reduce the total amount of farm land on China to less than 120million hectares (through desertification or through land grabs for construction)." Mr Wen also signalled the Government would control the scale of urban development and instead direct resources towards water conservation projects, energy production bases and trunk rail lines and highways. Direct subsidies to grain farmers would be increased and the Government would continue to set a minimum price for grain.theaustralian.news.com.au