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China’s pollution crackdown has global impact

China’s winter pollution shutdown, which began in September and is scheduled through March, is set to continue, according to environmental minister Li Ganjie. “This is not a one-off, it will continue in the future,” Li said.

“These special campaigns are not a one-off, instead it is an exploration of long-term mechanisms. They have proven effective so we will continue with these measures.”

Chinese President Xi Jinping has called for China to become an “ecological civilization.” Chinese cities have a deadline of the end of the year to meet clean air goals set five years ago. Mr Li said the progress made in addressing air pollution was not enough and China’s energy mix was “still dominated by coal” and the proportion of heavy industry too high.

The impact is being felt across China. Entire industrial regions are being temporarily shut down, as inspectors go into the factories to monitor compliance with the environmental laws.

Australian iron ore and coal exports, as well as steel mills and cement makers, are feeling the impact of the slowdown in Chinese demand since the crackdown.

The timing of the shutdowns will also impact supply chains producing goods for the upcoming Christmas season in the U.S.

The hope is that enforcing the laws will not only bring blue skies to China, but that “[F]actories will be better, more sustainable, and more socially responsible after being inspected,” according to Archie Liu, general manager of MKT & Associates, “It’s better for our supply chain. Then we can tell Walmart, Costco, and other retailers of ours that we’re qualified and that everything we make for Americans are environmentally friendly.”

Read referenced articles here and here.

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