By David Ingram | October 24 2016
(Reuters) China will encourage banks to play a bigger role in providing the financing required to tackle mounting environmental problems in rural regions, a government official said on Friday.
The Ministry of Environmental Protection (MEP) has admitted that the countryside has been a “weak link” in the country’s “war on pollution”, which has mainly focused on cutting hazardous smog in industrialised regions like Hebei.
The government has been looking for new ways to fund efforts to remediate contaminated land, cut fertiliser use and tackle the vast amounts of untreated household waste that threaten rural soil and water supplies, but governments have continued to foot most of the bill.
To help meet the vast funding gap, new guidelines have now been drawn up to encourage banks to provide more financial support for rural environmental treatment enterprises and encourage the use of public-private partnerships, the official said in comments published in China Environmental News, the official publication of the Ministry of Environmental Protection (MEP).
The official said China aims to treat or utilise 60 percent of livestock waste by the end of 2020. It would also aim to “effectively treat” more than 90 percent of rural household waste by the end of the decade.
But central and local governments have continued to bear the entire cost burden for crucial water treatment and transmission infrastructure, and China is still struggling to implement an effective “polluter pays” system for handling waste, the official added.
In the current round of environmental treatment work in the countryside, only 10 percent of China’s 600,000 villages had performed the appropriate renovations, and many of those were now struggling to pay for work that had been done, he said.
“The funding of rural environmental treatment is inadequate at every level,” he was quoted as saying.
As well as encouraging the involvement of financial institutions, China will use favourable power prices and other preferential policies to encourage the construction of biomass and biogas power plants in rural areas, he added.
China’s five-year plan published in March said the country would give priority to cleaning up contaminated soil used in agriculture. It also promised to strengthen soil pollution monitoring systems and promote new clean-up technologies.
But treating agricultural land could end up costing China trillions of yuan, and policymakers are still trying to establish mechanisms that will allow private firms to profit from the clean-up.
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