When Beijing’s pollution spikes, so do Chris Buckley’s sales.
“I open my window in the morning and look out, and I can tell how many calls I will get that day,” says Mr Buckley, who sells air purifiers and face masks at his two Torana Clean Air outlets in Beijing.
Pollution may be bad for most people’s health, but it is good for some people’s businesses. China is a growing market for any product that can reduce emissions or their effect on human health, from water treatment contracts worth hundreds of millions of dollars to face masks that sell for a few cents each.
Smog in China regularly reaches levels deemed unsafe for long-term exposure, and air quality has become a fixation of the upper middle class in Beijing. It has eclipsed other arguably more serious problems – for instance, more than half of the country’s waterways are considered “severely polluted”. One of the toughest problems is the soil pollution that stunts crops and causes high levels of cancer among villagers.
Mr Buckley, a chemist by training and a former lab safety adviser for Procter & Gamble, sold woollen carpets made in Tibet with traditional dyes and modern designs. He added air purifiers to his shops about five years ago. “My staff thought I was nuts but, after a few years, air purifiers started outselling rugs,” he says.
As China gets richer, citizens increase their demands for clean streets, drinkable tap water and fresh, breathable air.
At the same time, wealth is still being created from mines, construction and factories belching fumes, meaning that attempts to address pollution often seem to lag well behind the pollution itself.
Only half of China’s household and industrial waste is treated. New investment barely keeps up with the hundreds of millions of Chinese who are swelling the cities.
In the frigid winter of 2005, a 90km benzene slick flowed down the Songhua river in Manchuria, cutting off drinking water in Chinese and Russian cities. That spill was a turning point. Initially covered up by provincial governments and the petrochemical company that caused it, the spill ultimately led to greater tolerance of environmental reporting, and a much greater allocation of public funds for pollution mitigation.
The Chinese government earmarked Rmb3tn ($492bn) towards environmental protection, carbon reduction and recycling in the five years ending in 2015, up from Rmb1.4tn in the five years before 2010. Half that money was destined for wastewater and solid waste treatment plants, in a sign of the basic problems that still need to be addressed.
It is no accident that one of the biggest Chinese investments into Great Britain is the sovereign wealth fund’s purchase of a 9 per cent stake in Thames Water, a utility that traces its history to the “Great Stink” of Victorian times when the smell of sewage wafted through London. Thames Water offers not only a steady rate of return but also expertise in managing the problems of dense modern cities. The parallel growth of China’s economic might and its pollution problem present an opportunity for companies that offer anything from basic urban services to more specialised technological solutions.
French utility Veolia treats water used by 43m people in 11 Chinese cities. Rival Suez Environnement has plants in five cities. Both companies face competition from Chinese municipal utilities that are developing into water-service companies.
For smaller companies offering higher-tech solutions, government support still makes a big difference, says Liang Qing of Tianjin GoalGen Biotechnology, who ploughs profits from his pharmaceuticals research company into a second business that makes sewage-treatment equipment for toilets at isolated industrial sites.
“Before, as we say in Chinese, it was ‘big thunder, little rain’ – lots of talk but little support. Now there are lots of measures,” says Mr Liang.
“I think it’s reflective of the country’s development. Now that the government has money, it needs to do something about the environment.”
Of course, too much support can have unintended consequences, contributing to the overcapacity that plagues Chinese industry.
Profit margins are so low that factories are reluctant to run emissions reduction equipment. In the environmental realm as well as many other sectors, Chinese local governments like to pick local champions for central government largesse.
Simply earmarking money doesn’t mean environmental goals are met.
In a country where powerful industrial and political interests are often at cross-purposes, and most citizens are still a long way from the quality of life enjoyed in Europe and the US, opportunities to pollute and to make money cleaning up that pollution are likely to be many and varied. Says Mr Buckley: “I still have a couple of decades to sell my air purifiers.”
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