China Creates $1.65 Billion Fund to Clean the Air

Family on a Scooter

By Justin Bull

February 20, 2014

China has announced new measures to help control air pollution, including a $1.65 billion USD fund directed towards the prevention and control of air pollution in key areas.

The central government will reward projects that promote cleaner gasoline, energy efficient buildings and upgraded grid technologies. Further, the government said it would start taking air pollution into consideration when monitoring the performance of local governments.

The new fund coincides with China facing intense scrutiny over its air pollution. Recently, state-owned television channel CCTV publicly criticized the municipal government of Beijing, stating on Weibo (a Twitter-like service), “The government should not shun its responsibility or turn a blind eye to the smog.”

Soon after, the city announced plans to shutter over 300 industrial facilities, promote at least 50 clean development projects, and conduct environmental audits of an additional 200 factories. The government also ruled-out any new heavy polluting projects like cement or steel production plants.

The new fund also represents an opportunity for foreign investors to partner with local Chinese partners to improve environmental performance. On a recent visit by U.S. Secretary of State John Kerry, cooperation on clean technology and climate change was heralded as an investment opportunity.

Canadian politicians and companies are increasingly looking across the Pacific to new business and investment opportunities. BC Premier Christy Clark visited China on a trade mission at the end of 2013, calling the trip the “most successful ever.”

Currently, most Canada-China trade involves resources and commodities, but that does not rule out growth in the clean technology sector. The strong economic ties between the countries could provide an entry point for Canadian companies looking to assist Chinese counter-parts in curbing air pollution.

Given the wide variety of projects the new fund will support, Canadian clean technology and expertise could be employed in modernizing electrical grids, improving the energy efficiency of buildings, or developing clean transportation networks.