Authors: Fang Qi and Qian Lihua, "Industrial Economic Research & Consulting Co., Ltd."
Article: China Finance, media convergence feed
According to Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, the construction of ecological civilization has become an indispensable and important part of the overall layout of the "five-in-one" construction of socialism in the mainland. The report of the 19th National Congress of the Communist Party of China clearly pointed out: "Building an ecological civilization is a millennium plan for the sustainable development of the Chinese nation. The report of the 20th National Congress of the Communist Party of China further pointed out: "Chinese modernization is the modernization of harmonious coexistence between man and nature", "we adhere to sustainable development, adhere to the principle of giving priority to conservation, protection and natural restoration, protect nature and the ecological environment like protecting eyes, and unswervingly follow the path of civilized development with production development, affluent life and good ecology, so as to realize the sustainable development of the Chinese nation." As the first Equator Bank in China, IB is a pioneer in green finance in mainland China, and has been working hard in the field of green finance for 18 years since the first energy efficiency loan was launched in 2006. Relying on these customer bases, the IB Carbon Finance Research Institute conducted a questionnaire survey and constructed the "IB Green Prosperity Index (GPI)" based on it, aiming to track the prosperity of the development of green industries in a timely manner and look forward to future trends.
The prosperity of the green industry was basically the same as that of the previous month
The GPI index for January 2024 was 50.6%, basically unchanged from the previous month. From the perspective of sub-indexes, the demand for green industries continued to increase in January, with the new orders index rising by 1.1 percentage points from the previous month; the production expansion, the capacity utilization index increased by 2 percentage points from the previous month; the capital turnover continued to improve, with the capital index increasing by 0.9 percentage points month-on-month; the cost index rose but remained at a relatively low level; the decline in the price of finished products or services became the main drag, with the price index falling by 1.6 percentage points month-on-month, reflecting the increasingly fierce competition in the green environmental protection industry.
Fig. 1 Month-on-month change of GPI prosperity index and some sub-indexes
Source: Industrial Carbon Finance Research Institute.
Figure 2 GPI cost index and PPI
Source: Wind Information, Industrial Carbon Finance Research Institute.
The construction of a beautiful China is in full swing, and the green industry is expected to improve
On January 11, the "Opinions of the Central Committee of the Communist Party of China and the State Council on Comprehensively Promoting the Construction of a Beautiful China" was released, which carried out a comprehensive and systematic deployment around the goal path, key tasks and major policies of the construction of a beautiful China, and opened a new chapter in the construction of ecological civilization in the new era. With the comprehensive promotion of the construction of Beautiful China, the overall expectation of the green environmental protection industry is improving, and the GPI survey results show that the green industry expectation index in January increased by 1.1 percentage points compared with the previous month.
Figure 3 Trend of GPI Prosperity Index and Expectation Index
Source: Industrial Carbon Finance Research Institute.
Fig.4 Three-stage goals and paths for the construction of Beautiful China
Source: Opinions of the Central Committee of the Communist Party of China and the State Council on Comprehensively Promoting the Construction of a Beautiful China, Industrial Carbon Finance Research Institute.
The prosperity of sewage treatment-related industries has improved
At the end of December 2023, the National Development and Reform Commission and other three ministries and commissions jointly issued the "Implementation Opinions on Promoting the Synergy of Pollution Reduction and Carbon Reduction in Sewage Treatment", proposing key tasks such as strengthening water conservation and efficiency at the source, strengthening energy conservation and carbon reduction in sewage treatment, and promoting energy conservation and carbon reduction in sludge treatment, which will promote the high-quality development of the sewage treatment industry. According to the GPI survey results in January, the prosperity of the water pollution control industry increased by 8.1 percentage points month-on-month, and the prosperity of the water treatment, utilization and distribution industry also increased by 1.5 percentage points compared with the previous month.
Fig.5 Month-on-month change in the prosperity of sewage treatment-related industries
Source: Industrial Carbon Finance Research Institute.
On December 29, 2023, the National Development and Reform Commission, the Ministry of Housing and Urban-Rural Development and the Ministry of Ecology and Environment jointly issued the "Implementation Opinions on Promoting the Synergy of Pollution Reduction and Carbon Reduction in Sewage Treatment" (hereinafter referred to as the "Implementation Opinions"), aiming to achieve positive progress in the synergy of pollution reduction and carbon reduction in the sewage treatment industry by 2025, and the energy efficiency level and carbon reduction capacity will continue to improve. The utilization rate of reclaimed water in water-scarce cities at and above the prefecture level has reached more than 25%, and 100 green and low-carbon benchmark plants for sewage treatment with efficient recycling of energy resources have been built. The "Implementation Opinions" deploy three key tasks, covering the whole process of sewage collection and treatment. The first is to strengthen water conservation and efficiency at the source. Strengthen water conservation and emission reduction at the source, speed up the completion of sewage collection shortcomings, optimize the layout of sewage collection and treatment facilities, and reduce the distance of sewage transportation. The second is to strengthen sewage treatment, energy conservation and carbon reduction. Implement energy-saving transformation, strengthen digital empowerment, optimize load matching, strengthen greenhouse gas emission control, increase the application of renewable energy, and promote the use of reclaimed water. The third is to promote sludge treatment to save energy and reduce carbon emissions. Promote low-carbon sludge treatment technology, strengthen sludge biogas recycling, and promote sludge resource utilization. In addition, the "Implementation Opinions" also proposed to increase financial support for sewage treatment pollution reduction and carbon reduction upgrading projects, improve the sewage treatment charging mechanism, and implement relevant preferential tax policies and green power certificate related policies and other incentive measures.
On December 25, 2023, the Ministry of Ecology and Environment announced the results of the second batch of regional reclaimed water recycling pilot projects, which were based on the Notice of the General Office of the Ministry of Ecology and Environment, the General Office of the National Development and Reform Commission, the General Office of the Ministry of Housing and Urban-Rural Development, and the General Office of the Ministry of Water Resources on Printing and Distributing the "Regional Reclaimed Water Recycling Pilot Implementation Plan" (Huanban Water Body [2021]) No. 28) relevant requirements, the Ministry of Ecology and Environment, in conjunction with the Ministry of Water Resources, the National Water Conservation Office and other relevant departments and bureaus to organize experts to carry out, according to the results of expert review, it is proposed to identify 19 cities as pilot cities, including: Xingtai City, Hebei Province, Luliang City, Shanxi Province, Hohhot City, Inner Mongolia Autonomous Region, Huzhou City, Zhejiang Province, Dongying City, Jining City, Shandong Province, Luoyang City, Hebi City, Henan Province, Wuhan City, Hubei Province, Ziyang City, Sichuan Province, Dali Bai Autonomous Prefecture, Yunnan Province, Lanzhou City, Gansu Province, Dingxi City, Xining City, Qinghai Province, Guyuan City, Ningxia Hui Autonomous Region, Urumqi City, Hami City, Xinjiang Uygur Autonomous Region, Alar City, 1st Division of Xinjiang Production and Construction Corps, Shihezi City, 8th Division.
The prosperity of large and medium-sized enterprises has improved
In terms of enterprise size, the GPI survey results in January showed that the prosperity index of large enterprises, large and medium-sized enterprises and small and medium-sized enterprises increased by 1.8, 2.4 and 1.4 percentage points respectively from the previous month, while the prosperity index of small enterprises decreased by 4.3 percentage points from the previous month, and the degree of differentiation of enterprises of different sizes increased.
Fig. 6 Trend of GPI business sentiment index by scale
Exhibit 1: Source: Industrial Carbon Finance Research Institute.
(Editor-in-charge: Xu Xiaoping)