Enter the (green) Dragon
Business types meeting this weekend at the World Economic Forum have had their discussions described by the Guardian as a sinister-sounding 'Chinese-American plan to “take over the world” in low-carbon technology'.
I think something may have been lost in translation.
The quote on which this story hangs is from Ming Sung, Asia-Pacific chief of the Clean Air Taskforce, speaking at the launch of a huge study claiming China could build a green-tech market worth US $1 trillion a year. The phrase ‘take-over the world’ makes that sound a bad thing. But English is not Ming’s first language. Would it have been any different if he had said China was ready to ‘over-take’ the world instead?
China is too often seen as a bloated, gassy obstacle to the rest of our efforts at sorting climate change out quickly. The reality, as the report shows, is a paradox; China really could be the next Big Green Thing, if only because the country is so polluted it has little choice. These might surprise you:
- Biggest manufacturer of photovoltaic (solar-power) cells in the world? China, with almost a third of global production in 2007.
- Biggest seller of electric scooters and bikes? China, with over 90 per cent of global sales.
- What about fuel efficiency standards for its millions of cars? Stricter than the US, Canada or Australia? China.
- Who has best cleaned up their industry, measured in reduction of the energy, and thus pollution, required to produce one unit of Gross Domestic Product? China, a fall of 70 per cent since 1980. No one else comes close.
- Renewable energy target? 20 per cent by 2020. Same as the EU.
- Amount the government is expected to spend achieving this? Three trillion yuan (US$ 444 billion). A lot more than the EU.
This isn’t to pretend China gets a thumbs-up on all fronts. The country is building more power-stations every year than the entire generating capacity of the UK (see chart below), and most of those are coal. But don’t simply write China off. Anyone know who's building the world’s biggest and most efficient Carbon Capture and Storage project? That’ll be an American-Chinese business, based in Shanghai. British efforts at CCS aren’t even close. Being over-taken isn’t the same as a take-over.
Fall and rise
Monday (September 14) saw the anniversary of the fall of Lehman Brothers, the US bank, which threw open the doors to last winter’s recession. One year on, those bankers who held on to their jobs are feeling more chipper.
Last week the British FTSE 100 share index rose above 5000 for the first time since last October. That should mean British companies are recovering. But the country is falling down world economic rankings. So what’s going on?
God knows. Except that the old idea that stock prices simply reflect all known information about a company may have died in the cold. One alternative is that it works like this: once a few investors say now is the time to buy, while prices are cheap, everyone else follows, panicked at the thought of missing out on all that potential profit. As a result, prices go up. For stock market, think herd of sheep.
UPDATE: 21st September, 2009
Speaking of China, the country is due to unveil plans for its own emissions-trading scheme this week at a UN conference in New York. This is a big deal; emissions trading has come in for a lot of flak and it's a brave man who says he knows for sure where the market will go, but one thing's for sure - China pumps out so much CO2 (20 per cent of the global smog) that any plan to cap it will have a huge effect on the market worldwide. When the dragon swishes its tail, everyone gets a smack in the face...
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