The cheap, disposable tableware used in many Chinese hotels and restaurants contributes significantly to resource waste in China. But a recently passed law now limits the production, consumption and export of such one-time-use products and offers tax incentives to achieve the goal.

China's top legislature, the National People's Congress (NPC), passed the law on August 29, promoting a "circular economy" in China-one that balances economic development with environmental and resource protection and pollution prevention. The law, which provides a framework for the country's sustainable development strategy, will enter into force on January 1, 2009.

"Developing a recycling economy will help the country achieve maximal economic efficiency through minimal energy consumption and emissions," said Ni Yuefeng, an official at the Environment and Resource Protection Committee of the NPC, at a press conference held after the law was passed. "This law is a significant step in building China into an energy efficient and environment-friendly society."

Background

China's rapid economic development during the past few decades has demanded massive supplies of basic industrial commodities and intensified competition with other countries for resources. In the meantime, China also faces increasingly severe conflicts between economic development and resource availability and environment protection. China is a resource-poor country whose per-capita natural resources reserves are very low. Yet, resources here are wasted on a widespread basis, primarily due to the country's low level of energy efficiency.

Lu Zhiming, a doctoral candidate in finance at Shanghai's Fudan University told Shanghai Securities News that while China has increased its energy efficiency remarkably, it still lags far behind developed countries.

Statistics from the National Development and Reform Commission indicate that on average, China's steel, electricity and cement industries consume 20 percent more energy per unit of GDP than their counterparts in developed countries. China recycles 30 percent of its mineral resources, but this amount is 20 percent less than advanced international levels. China reuses 60 percent of its wood resources, which is 20 percent less than advanced international levels.

The call for a law on circular economy in China came about in response to the country's tight energy and resource situation. In August 2007, a draft law on circular economy was submitted for the first reading in the NPC. It took only one year for the country's legislators to adopt it -- a rarity in China for a law to be passed so quickly.

Legal requirements

The law has set up several measures to promote a circular economy, including prohibiting resource waste, reducing pollutant discharges, strengthening the producer accountability system and monitoring high energy-consuming or resource-intensive industries. The law also highlights energy conservations.

"China is in an era of rapid industrialization, marked by high energy consumption and wasteful energy usage," said Feng Zhijun, an official at the Environment and Resources Protection Committee of the NPC, during a committee meeting. "There is huge potential to cut consumption, increase efficiency and conserve energy."

The law prohibits companies from dumping untreated waste and requires them to recover and comprehensively reuse coal ash, flue gas and other kinds of wastes. The law also specifies standards on the usage of one-time-