ERM is one of the world’s largest environmental consultancies, with 120 offices in 40 countries. David Arthur, ERM’s regional manager for Shanghai, has over 10 years of experience dealing with the industrial and regulatory issues involved in eco-management in China. He spoke to CHINA ECONOMIC REVIEW about China’s unique recycling system, pollution’s impact on the country’s strained natural resources, and whether nuclear energy makes sense for a nation rushing to embrace it.
Q: Who are your clients in China?
A: The main business focus is work for the big multinationals that are investing in China who got very badly bitten in the US in the 1980s. They suddenly had to clean up and remediate all the pollution they put down for decades before that. Some of them felt they were quite innocent, if you like, but this was retrospective legislation in the US, and they are paranoid about being caught again.
Q: What kind of work do you do for them?
A: Whether they’re buying into a facility or buying a greenfield site, they want to know what the environmental baseline conditions are. They want an independent report – we’re independent consultants – so they can show what the conditions were when they moved in. Quite often when they move out, they want another due diligence report to show conditions haven’t deteriorated further. So if in 50 years time China decides to bring in such retrospective legislature, [clients] have independent reports to say the pollution wasn’t because of them.
Q: A draft recycling law was debated at the end of August. What do you make of it?
A: China does not have as many standard hazardous-waste treatment facilities as it needs. The standards are not high enough – they might have met local regulations, but not the international standards these MNCs have set within themselves. As a result, international companies that are producing hazardous waste have been storing it. They’ve become very good at minimizing the amount they produce because they know that, until quite recently, there’s been nowhere to get it treated. So many companies have been storing their hazardous waste on-site and waiting for the day when there’ll be high enough standard treatment available, and I think that time is fast approaching now.
Q: What’s the state of recycling like in China generally?
A: In this city, you can go round and see people looking into trash bags, taking out plastic bottles, cans, anything that’s recyclable. In the West, this went to landfill. China has never done this because it’s recyclable and people can make money from it. In the West, the taxpayer is paying to have stuff recycled. In Asia, you have an industry that doesn’t cost the taxpayer anything; it’s a self-sustaining industry that recycles. What China needs to do is build on what it’s got, look at some of the social aspects – you don’t really want people raking through bins – and take the best bits and figure out ways to enhance that. This is better than just regulating it away and replacing it with something that’s much more expensive.
Q: Which environmental resource is most badly polluted in China?
A: Air, although it looks terrible, can be tackled. If you put the fire out the air cleans up pretty quickly. This was seen in places like Hong Kong where you can almost clean it up overnight if you bring in the regulations. It is a major problem; it is a major health issue, but it’s something that can be cleaned up fairly rapidly. I think water is going to be the biggest issue for China in the coming few years. A lot more could be done on water conservation.
Q: How can the water shortage problem be solved?
A: We’ve got to be much more efficient in our water use. I stayed in a hotel recently where the water in the shower came out as a mist. It used so little water at first I thought there was something wrong with it. But when I got in I found there was plenty to shower with. So this is an area where China could be quite innovative. A lot of these technologies exist but no one has focused on them in a big way; China has the opportunity to do this.
Q: What about technologies like desalination?
A: Desalination is feasible but it’s very expensive. It’s also fine if you live down the eastern and southern coasts, but it’s not so good if you live in Chongqing or any of the western cities. Desalination is not really going to meet the needs of China. Of course a lot of the rivers here, even the big rivers, are highly polluted so there is a lot of work going on to intercept drainage going into these rivers. More work needs to be done by the environmental protection bureaus to enforce discharge standards so that we clean up the water we have got and look after it a lot better.
Q: How long will it take for China to clean up its water?
A: Anywhere else, 20 years or so. But I believe China can do it much faster than that. China’s proved everywhere that the system it has at the moment allows it to do things, make decisions, much more rapidly than other places. It’s not going to be pristine in 10 years but you could make a huge difference – to the point you can use it as drinking water supplies.
Q: What about nuclear energy? China has said it wants to build 32 reactors by 2020.
A: I lived through ‘Nuclear is the savior for everything’ to ‘Oh, this is awful’ and now we’re back to ‘This is the savior’ again. It’s a potentially dangerous technology and there have been a few disasters. But in terms of CO2 emissions and stuff like that, it’s all clean. I suspect we are not too far off some alternative, something similar to nuclear but not quite as dangerous. But how far that is in the future – 10, 20, 40 years? I think it might be a bad decision to build too many nuclear facilities. I’m not saying don’t build any, but you shouldn’t throw all the eggs in that one basket. Because how do you decommission a nuclear plant? You build a plant, it lasts you 30 years, but it’s going to take another three or four hundred years before it becomes safe to do anything with it.
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