Trade war bites China’s anti-pollution rules
China has relaxed its winter anti-pollution measures in the midst of a damaging trade war as it prioritises economic growth over the environment. With the new US tariffs on US$200bn worth of Chinese imports now in place at 10% and likely to rise to 25% on 1 January, China’s economy is starting to feel the pinch. Manufacturing momentum is apparently lost in China as companies prepare for the impacts of the US tariffs.
The latest official manufacturing purchasing managers’ index (PMI) slipped to an eight-month low of 50.8 in September from 51.3 in the previous month. Chinese finished goods for exports to the US were hit particularly hard and have cut their purchases of raw materials.
As the economy slows, leaders are relaxing environmental rules with hope of stimulating growth. According to reports, a target of a 3% year-on-year reduction in average intensity and number of days with high levels of the particulate PM2.5 would be implemented in Beijing, Tianjin, Hebei and surrounding areas. The target applies from October 2018 to March 2019 and affects producers of thermal power, steel, petrochemicals and cement. That is less than the 5% cut proposed in an initial plan seen by the South China Morning Post in August and are well below the cuts of ‘at least 15%’ set out in last year’s plan, the paper says.
