Wealth but not health?

When Chinese Premier Li Keqiang declared war on pollution two years ago, he described it as a deadly enemy, and promised “we must fight it with all our might”.

Xi Jinping, China’s president and Li’s senior colleague, has made similar commitments about confronting the toxic air, describing it as a key priority for his government.

Some of the martial imagery has seemed a little more appropriate over the past three weeks after a series of cities sounded the red alert on the latest pollution front, which is threatening thousands of long-term casualties.

Municipal governments have even been employing ‘mist cannons’ in a bid to clear the skies. Originally designed to deal with dust at mining sites, they fire water vapour that is supposed to strip the air of its toxic particles. Not many environmental campaigners are impressed, claiming that the artillery doesn’t deal with the nastiest particles, and warning that the bombardments render the pollution readings inaccurate.

But as another round of poisonous smog percolates through the homes of half a billion people, city bosses can be forgiven a little of their desperation. Will China ever get to grips with its pollution problem?

Where has the pollution hit hardest?

The toxic air has been worst in the north. Under China’s four-tiered smog warning system, red alerts are issued when the air quality indices show readings higher than 200 for at least four days, more than 300 for two or more days, or higher than 500 for 24 hours. At least 20 cities issued red alerts over a five-day period in mid-December, including Beijing, the capital, where authorities have reduced the number of cars on the streets, shut schools and instructed factories and construction sites to stop work.

But the response has done little to ease the concerns of members of the public, many of whom focus on metrics such as the prevalence in the atmosphere of PM2.5 particles, which pose some of the greatest health risks.

The readings have been reaching hazardous levels at many locations. Beijing reported more than 400 micrograms per cubic metre and contamination touched more than 1000 micrograms in Shijiazhuang in Hebei on December 18 (the World Health Organisation classifies exposure to more than 10-25 micrograms as dangerous).

Long-suffering residents have been doing their best to protect themselves. Xinhua reports that 15 million facemasks were sold online in December and that thousands of locals have been trying to get out of the worst-affected locations, despite many expressways being closed due to the poor visibility.

Ctrip – China’s leading online travel firm – says that at least 150,000 wealthier travellers took to the skies to flee the pollution last month, mostly to Japan, Korea and Southeast Asia (though not all their compatriots – those who could not afford to leave – greeted their hasty departures favourably. Indeed megastar Zhang Ziyi made the mistake of posting on Sina Weibo “I am leaving Beijing with my baby to escape the smog” and then faced a barrage of criticism, ranging from one netizen declaring her unpatriotic for running away from the mainland at a time of difficulty, to thousands of parents remonstrating with her ‘That’s good for your baby but what about our babies?’).

That said, even those with the financial means to escape China found that thousands of flights were cancelled.

Thankfully the skies cleared a little over Christmas but the smog started to return at the beginning of this week and the Ministry of Environmental Protection said on Sunday that 62 northern cities had issued another round of yellow, orange or red warnings.

Xinhua reports that severe pollution could persist for at least seven days.

What’s to blame for the smog?

The winter weather is definitely a factor, trapping dust and fumes in the colder, heavier air. Crucially, the colder weather drives heightened demand for coal-fired power for heating homes and offices.

The media has been in no mood to blame the weather, however. “The pollutants causing smog are the result of human activity. Smog is not a meteorological disaster,” Qianjiang Evening News has insisted. “If we don’t understand that smog is caused by people, we cannot solve the problem and [officials] will just pass the buck.”

Another of the key reasons that the pollution is worst across northern China is that this is also where much of the heaviest industry is concentrated. A number of high-polluting companies have already been identified as immediate culprits. The environment ministry turned on a number of local governments for their failings in November, including the city of Linfen in Shanxi (a perennial poor performer in the pollution rankings, see WiC10 and WiC156), and shortly before Christmas it accused more than 20 enterprises of breaking the rules by “maliciously” dodging government inspections and disobeying orders to suspend output.

Several cities in Hebei took a particular hammering as the ministry named and shamed steelmakers, power producers and chemical firms.

At least the smog sirens have been sounded this year. In November 2015 officials in Beijing came in for severe criticism after failing to initiate a red alert in the capital despite some of the dirtiest air in living memory. The public was furious, suspecting that city chiefs wanted to dodge the disruption triggered by the alerts. The environment ministry agreed, issuing a rare public rebuke and highlighting that “central leaders” were monitoring the situation closely.

This year the alerts were triggered more readily and it was the first time that a red alert had been issued in advance of the worst days of smog “with the sky still blue”, noted Ma Tianjie on China Dialogue, an environmental blog.

Ma says the environment ministry is putting pressure on local authorities by issuing “alert notes” requiring them to publish the upper limits of the pollution forecasts, and it has been compelling nearby cities to take joint action, rather than relying on their neighbours to clear the air first and hoping to avoid the costs of a more localised response.

Bosses at the Ministry of Environmental Protection have also taken over the supervision of more than 1,400 monitoring stations at a central level, after a string of scandals in which local officials were discovered to have tampered with the data.

More legislation to punish polluters?

In another sign that the State Council is desperate to do more to counter pollution, lawmakers at the National People’s Congress passed new environmental legislation on Christmas Day taxing factories and power plants based on their output of airborne and water pollution, and coal mines for their waste and hazardous output.

The new taxes won’t be applied until January 2018 but they mark a break with previous practice in which local governments were tasked with imposing pollution discharge fees on companies in their jurisdictions.

In many cases the fees were regarded as too low to deter firms from polluting their surroundings, and local bureaucrats have often granted exemptions to employers that generate jobs and fiscal revenue in their neighbourhoods.

Now policymakers want to entrench the ‘polluter pays’ principle and the new law gives the National People’s Congress the option of increasing the tax based on the environmental conditions.

“The core purpose isn’t to increase taxes, but to improve the system, and encourage enterprises to reduce emissions – the more they emit the more they will pay, and the less they emit the less they will pay,” explained environment minister Chen Jining, when the legislation was being drafted.

Green campaigners have offered a cautious welcome, although they are reserving judgement until they see whether the new legislation will be strictly implemented.

They also complain that the taxes are still too low, and they query why they won’t apply to emissions of carbon dioxide, a major contributor to global warming.

The state media has tried to sound more confident that the new legislation will have an impact and that polluters will be forced to pay more – the China Daily is reporting that Rmb17.3 billion ($2.5 billion) was collected in pollution fees in 2015, but that the new taxes will generate $50 billion in their first year.

New thinking needed on the trade-off between growth and grime?

Previous leaderships tended to regard pollution as a necessary evil as China chased yet another round of breakneck growth. Now the narrative is changing as the country targets a higher ‘quality’ of economic development and tries to move away from its reliance on dirtier heavy industries like cement, steel and coal.

The trade-off between pollution and profit is a complicated one, although some newspapers are claiming that policymakers were on track to meet annual targets reducing air pollution until the government relaxed restrictions on coal and steel production as part of efforts to boost China’s slowing rate of GDP growth later in the year.

21CN Business Herald made a similar point about the impact of industrial activity, mentioning that provincial officials in heavily polluted Hebei had succeeded in reducing the number of steel mills last year, but that many mills started up again (illegally) as steel prices rose, often operating covertly at night.

The scale of the subsequent pollution is much more difficult to disguise, especially as social media records how the smog is saturating the lives of hundreds of millions of people.

Public anxiety about the health risks of the filthy air is growing rapidly with research linking it to nearly a third of deaths in China, according to a study of air pollution in 74 cities that was published in November by Nanjing University’s School of the Environment.

The International Energy Agency concluded a study of its own last year with calculations that the pollution had shortened life expectancy by an average of 25 months, and another academic paper in December suggested that the levels of sulphur in Beijing’s winter air are sometimes similar to volcanic eruptions. The South China Morning Post reports that researchers from Germany, the United States and China found that man-made air pollutants in the lower atmosphere had reached a level unprecedented in human history, and that the situation was triggering chemical reactions previously thought impossible.

Of course, it’s worth noting that awareness of China’s environmental challenges has improved significantly from as recently as five years ago, when pollution levels were monitored infrequently and results even more rarely made available to the public (see WiC130).

Readings for PM2.5 contamination have also been falling in some cities, according to some sources, including in Beijing, where analysis by the Paulson Institute and Greenpeace of air quality data from the US Embassy suggested a 16% fall in the concentration of this deadly type of air pollutant across 2015 (albeit most of the improvement was recorded in the summer and early autumn).

Also more encouragingly, Tyler Cowen, a professor at George Mason University, told Bloomberg last week that environmental initiatives have tended to get new impetus when countries reach per capita incomes equivalent to about $17,000 or $18,000 today. Average incomes in China are nearing the lower end of this range, he estimates, which means that the country could be close to the point at which the campaign will start in earnest.

Indeed, the Chinese could even be classed as ahead of the United States in their efforts to counter pollution at the current stage of their economic development, Cowen believes, because the Americans didn’t get serious about cleaner air until the mid-1960s, when average incomes were about $28,000 a year.

China’s leaders also understand that cutting back on coal is key to improving air quality and the State Council released its latest five-year environmental protection plan in November with new goals to reduce coal’s share of total energy consumption to 58% by 2020, compared to 64% in 2015 (it was in the low seventies when WiC first started publishing in 2009).

The plan sets reduction targets for regions where coal consumption is greatest, like Beijing and Tianjin in the north and the Pearl River Delta in southern China, where the cutbacks would be the equivalent to eliminating the annual coal consumption of South Korea, itself an industrial powerhouse.

Also for the first time, there is a sliding scale for reducing PM2.5 particles down to a threshold of 35 micrograms per cubic metre. “The 11th and 12th Five-Year Plans only referred to ‘emission reduction targets’, so local governments could play games by claiming they had reduced emissions. Now, by saying by what year the PM2.5 must be below a certain amount, it’s much harder to fake,” Ma Jun, the director of the Institute of Public and Environmental Affairs, told the New York Times.

Behind all of these blueprints is pressure from a population that no longer accepts pollution as the price of economic progress.

Currently the public’s anger is focused on companies that contaminate their surroundings and the local governments that fail to stop them. But pollution is becoming a political liability for the Party at an elite level as well. Citizens may well wonder why their masters seem more motivated about scrubbing the skies for the visits of foreign dignitaries (see WiC260 for our first reference to ‘APEC blue’) than for the public at large, for instance, and Xi Jinping’s team must know that more questions will be asked if it fails to get an effective grip on the grime and gloom enveloping millions of their people.

“We believe that China’s smog is not unavoidable, but is the result of weaknesses in governance,” Cheng Hai, one of a group of lawyers trying to sue the governments of Beijing, Tianjin and Hebei province for the dirty air, told Reuters last month.

This is one problem for the Chinese leadership where its progress will be transparent: after all, if December’s dire conditions recur it will be obvious to everyone.

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