UPDATE 1-China's Tianjin bans new steel, cement plants - report

Tue Apr 15, 2014 2:15am EDT

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BEIJING, April 15 (Reuters) - The government of the industrial city of Tianjin in northern China said it would not approve any new steel, cement or non-ferrous metals plants in a bid to fight pollution, state media reported on Tuesday.

The announcement, reported by Xinhua news agency, echoed similar statements by the governments in neighbouring Hebei province and Beijing, and is in line with a central government plan last year to restrict new manufacturing in key industrial centres.

China has vowed to reverse the damage done to its environment by decades of untrammeled economic growth, and has identified the region of Beijing, Hebei and Tianjin as one of the key targets of a programme to curb big industries like steel, thermal power and cement, all major sources of smog.

"I believe this is an economic strategy to cut down on over-capacity, and it will not lead to more steel plants being built elsewhere, so it will contribute to reducing emissions, especially in the hotspot areas," said Chu Yang, a senior analyst at China Policy, a Beijing-based consultancy.

China has struggled to meet its environmental goals, with economic growth long at the top of its political agenda, but it has now vowed to impose its will on local governments and make cleaning up the environment its number one priority.

Hebei province consumed about 280 million tonnes of coal last year and is under pressure to cut 40 million tonnes by 2017. The capital Beijing aims to slash consumption by 13 million tonnes to just 10 million tonnes over the same period. Tianjin used 47 million tonnes last year, and aims to cut 10 million tonnes by 2017.

While Beijing has already shut and relocated its steel mills, Hebei and Tianjin together produced more than 200 million tonnes of crude steel in 2013. They are under orders to close at least 60 million tonnes of low-quality plants by 2017, and Hebei's leaders have already threatened to fire officials who allow even a tonne of additional capacity on their patch.

However, with idle capacity in the region approaching 100 million tonnes and with many plants already on the brink of bankruptcy, the closure targets might not have as much of an impact on emissions as policymakers hope.

China has promised in a number of policy documents over the past two years that it would block the construction of new industrial plants like steel smelters, cement factories or oil refineries in three major "low-emission" regions, including Beijing-Hebei-Tianjin, the Yangtze river delta region centring on Shanghai and the Pearl river delta region in southern Guangdong province.

China's environment ministry has said the regions are responsible for 55 percent of national steel production, 40 percent of total cement output and 52 percent of gasoline and diesel, despite covering just 8 percent of the country's total area.

A former health minister said last year pollution related to coal-fired power causes up to 500,000 premature deaths annually. Research from environmental Greenpeace showed that coal-fired power plants in Hebei and Tianjin were responsible for as many as 9,900 premature deaths in 2011 alone. (Reporting by Stian Reklev and David Stanway; Editing by Anand Basu and Richard Pullin)

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