Smog-hit Hebei ordered by government to draw up restructuring plans

Source:Reuters-Global Times Published: 2014-12-7 23:28:02

The Chinese government has ordered its most polluted province, North China's Hebei, to draw up fresh plans to "upgrade" its economy in a bid to ease its dependence on heavy industries like steel and cement production, Beijing-based newspaper the Economic Observer reported over the weekend.

The local provincial government is now drawing up new economic restructuring plans which will eventually be passed on to the central government, the newspaper said, citing local officials.

Hebei, which surrounds the capital Beijing, is China's biggest steel producer and home to seven of the country's 10 smoggiest cities.

Therefore, the province has borne the brunt of a war on pollution, with large numbers of industrial plants set to be shut down.

It promised to cut 60 million tons of steel capacity and 40 million tons of coal consumption over the 2013-17 period, but it has so far struggled to find alternative sources of growth.

The province's economy grew 6.2 percent in the first three quarters, behind a 2014 target of 8 percent, and in a speech delivered on November 26, Hebei Vice Governor Yang Chongyong called for more incentives for the province.

"Hebei has paid a very big price, with its economy suffering grave injuries," he told a forum.

"If there are just widespread enterprise closures and layoffs, if there are no new projects or employment opportunities, then there's no way of guaranteeing people's incomes and livelihoods, so how can we maintain stability?" he said at the forum.

Steel mill closures are said to be ahead of schedule, with the major steel city of Tangshan expecting to have shut 20 million tons in production by the end of the year, half its 2013-17 target, Xinhua News Agency reported in November.

It also shut large numbers of firms in early November in order to guarantee air quality during a meeting of the Asia-Pacific Economic Cooperation (APEC) summit held in Beijing.

But the Ministry of Environmental Protection said in October that some local governments in Hebei were not doing enough and preferred "form over substance" when it came to combating smog.

China is currently drawing up plans to integrate the regions of Hebei, Beijing and Tianjin. The plan is designed in part to improve Hebei's economic prospects by relocating industries like car manufacturing away from the capital.

The integration plan could be published as early as this month, Xinhua reported.

Posted in: Economy

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