Firms investing abroad need environmental guidlines
Several years ago, firms used to have consultants to invest. But now, only with consultants is not enough.The work about environmental guidelines for companies investing in or providing economic aid to overseas countries is undertaken by the Chinese Academy for Environmental Planning (CAEP), cooperating with the Global Environmental Institute (GEI) and the University of International Business and Economics. The GEI said the first draft of the work is now on the way.
According to the report released by the CAEP last week, the country lacked consciousness of environmental protection in its overseas projects, although investment had been expanding. Surveys tell us China’s overseas non-financial direct investment grew by 60 percent annually between 2002 and 2006. By the end of 2006, 5,000 Chinese companies had set up nearly 10,000 directly invested firms and invested $90.6 billion in 172 countries.
Because of the new environmental challenges being produced China should consider and take action. China’s overseas investment and aid mainly focuses on exploring oil and other resources, processing, manufacturing, and construction in African and Southeast Asian countries.
Such projects may cause environmental problems without proper management. In April, several companies, including China Mobile, Haier Group, and China International Marine Containers, joined “Caring for Climate”, a voluntary UN initiative to combat global climate change. These companies’ participation shows that China’s business sector is catching up with its international counterparts on climate issues.
The country’s largest oil producer, China National Petroleum Corporation has promised that they would decide on overseas projects only after sticking to stringent environmental requirements. Although China’s banking industry has seen development, its overseas credit business in recent years, most banks have not carried out the environmental concerns.
Up to now, only four banks in China have taken environmental concerns into account. They either formulated independent environmental standards for financing, or joined the United Nations Environment Program Finance Initiative to reduce environmental risks.
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