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The Guangdong provincial government has selected six cities as testing grounds for the development of a recycling economy.

The six cities will pick 300 enterprises and 15 industrial parks for the program.

The move by the southern province aims to build a resource conservation and environmentally friendly society to ensure sustained social and economic development.

Contributing to more than one tenth of the national economy, Guangdong consumes up to 9 per cent of the energy used nationwide, importing most of its energy and natural resources from other parts of the country and other nations.

Even though Guangdong province has a large economy and high growth, it has not made fundamental changes to its growth model. It still has high resource consumption, high pollutant discharge and low efficiency, according to a circular on building a recycling economy released by the local government last September.

The six cities, Guangzhou, Shenzhen, Foshan, Doguan, Jiangmen and Shantou, have been selected for the pilot program because they are the main consumers of energy and resources, said Xie Shichao, deputy director of the newly established Department of Environment & Resource Conservation of the Economic & Trade Commission of Guangdong.

The six cities will be required to make eco-friendly changes in production, consumption and management.

The enterprises selected for the program will be required to meet the national standards for clean production and create recycling technology, according to a circular on the program released by Xie's department in March.

Since the experimental work on clean production began in 2003, the provincial government has verified 52 enterprises who meet the standards, with another 20 being scrutinized, Xie said.

More than half of the 52 firms are foreign-funded and were active and well prepared to meet the standards, he said.

Meanwhile, the industrial parks in the program will be transformed or built to meet the principle of "reduce, reuse and recycle."

An information platform about by-products and the correct disposal of materials will be set up to facilitate recycling.

The projects selected for the program will receive funds from the government for technical renovations.

Tax incentive schemes for enterprises using waste water, waste gas and solid waste will also be developed.

In addition to capital support from the government, greater financial incentives are needed before companies completely embrace recycling.

Recycling used batteries, for example, has strong environmental benefits but is associated with high costs. It will not become a significant business until firms are financially motivated to do so.

(China Daily May 8, 2006)