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Research & Commentary

August 16, 2013

Macroeconomic Analysis: State Council of China defines environmental protection industry a pillar industry in China


The State Council of China issued the “Opinion in speeding up the development of energy saving and environmental protection industry” (the “Opinion”) last Sunday. The Opinion classifies energy-saving and the environmental protection industry as a “pillar industry” in China, and as such, it will be qualified to receive government support in the forms of subsidies, rewards and discounts in interest rates.


China Chengxin forecasts that implementation of the Opinion will lead to : (i) more domestic governments and corporations raising funds in the capital markets to invest in the energy-saving and environmental-protection industry; and (ii) lower funding costs if there is successful implementation of the Opinion’s policies such as “green credit”.


We have worked out two scenarios to forecast the growth of the environmental-protection industry. Under a slow growth scenario, with 10% industry growth and 7% GDP growth, the environmental-protection industry will account for 5.9% and 6.8% in 2012 and 2020, respectively. In contrast, under a rapid growth scenario, with 20% industry growth and 8% GDP growth, the industry will account for 8.2% and 13.8% in 2012 and 2020, respectively.

Please refer to CCXI website for full article (Chinese only):