The Next Big Industry in China?

Satellites, drones and remote sensors will soon be deployed across China to detect pollution levels over land, sea and air. This may indicate that normal methods to identify pollution levels haven’t really shown expected results. Or, that the levels have exceeded expected limits. In a country that is not only among the world’s top polluters but also has some of the most polluted cities, are environmental reforms becoming the norm? And what do these mean for the rest of the world?

China is embarking on the most ambitious environmental reform program in history — by necessity. China’s environmental woes are nothing new, but they have hit an inflection point. Less than 40 percent of China’s groundwater is safe for consumption. Only 16 of the 161 cities monitored met the national standards of urban air quality in 2014. Almost 20 per of China’s surveyed soil exceeds the national pollution standards, which amounts to 19 percent of their arable land being contaminated. And, while the rate of growth is slowing, China still emits more CO₂ than that of the US and the EU combined.

Environmental protests are the major cause of social unrest across the country — even edging out official graft. President Xi’s government recognizes that for political, economic and, certainly, environmental reasons, the government must move quickly to halt this growing crisis. China’s 13th Five-Year Plan — its economic blueprint for 2016 to 2020 — is expected to include bold measures to redress these problems. Total environmental expenditures are expected to exceed $1 trillion during the execution period of the 13th Five Year Plan. This amounts to a 60 percent increase over the last Five-Year Plan. But, the Chinese government can fund only 15 percent of this initiative.

The dire situation presents myriad opportunities for the private sector to support China’s ambitious environmental goals. A recent report by Goldman Sachs, “China’s Environment: Big Issues, Accelerating Effort, Ample Opportunities,” states that cleaning up China’s environment will be multibillion-dollar opportunity for the domestic and international private sector. In fact, financing from the private sector — either directly or in public private partnerships — will bring new technologies to China, spur innovative solutions and create jobs in environmental reform, a growing field.

Read more to see the core areas for reform on the map of China’s environment preservation mission.

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