Economic Policy News
- China orders removal of preferential policies for energy guzzlers
Date: 28-May-2007 Sources: (Xinhua Online)
China's top economic planning agency has ordered local authorities to remove preferential policies for energy guzzlers amid the nation's efforts to save energy and cut pollution.
The National Development and Reform Commission (NDRC) also warned local governments not to violate laws, regulations and policies by introducing preferential policies such as tax cuts to attract new high energy-consuming projects in the future.
The NDRC said local governments should set stricter market access standards to help eliminate outdated production facilities and tighten land use and credit supply for new projects.
To slow down the rapid growth of high energy-consuming projects is crucial to meeting China's energy saving and pollution reduction targets, the NDRC said in a statement on its Website.
The Chinese government has set a goal of reducing energy consumption per unit of gross domestic product by 20 percent by 2010, while pollutant discharge should drop by 10 percent.
Energy consumption, however, fell only 1.23 percent last year, less than one third of the annual goal of four percent.
Most of the energy-gorging industries including steel, electrolytic aluminum and cement saw growth rebound in the first quarter of the year after China introduced cooling measures in 2003, said the NDRC.
The six sectors of power, steel, oil refinery, chemicals, construction materials, and metals consume 70 percent of energy for industry and release the same percentage of sulfur dioxide.
The output of these sectors grew 20.6 percent in the first quarter, 6.6 percentage points higher than the same period last year, Chinese Premier Wen Jiabao said earlier this month.
Wen pledged China would push forward reforms in the pricing of natural gas, water and other resources, raise the tax levied on pollutant discharge, establish a 'polluter pays' system and severely punish those who violate the environmental protection laws.
The premier said the economy could hardly be sustainable if China failed to adjust the economic structure, transform the growth mode, and reduce energy consumption.
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