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You may have already heard about this, China is undergoing very strict environment protection inspection. You may wonder why do I need to know about that? Well, if your company is sourcing from China, or you have any ongoing cooperation with Chinese factories, it is very likely that your business is or will be suffering from this action.
Now China has some of the most polluted cities in the world. Air purifying equipment and anti-pollution masks sell out rapidly, especially in winter in the north of the China. Groundwater is polluted making safe drinking water a big concern. Environmental protection has been a hot topic these years, now the government is doing something about it.
After decades of growth left the country saddled with problems such as smog and contaminated soil, in 2016, China launched a series of central environmental inspections. Since June of 2017, China’s new Ministry of Environment is taking a hard stance against Chinese factories that are “heavy polluters”.
Industries that are suffered including Metal, Rubber, Ceramic, Chemicals, Dying, Painting, and Printing processes, Carbon.
The environmental audits have been implemented in rollouts that have begun in certain regions mostly centralized in and around Northern China. And then later phases reach other regions.
The months-long inspection mainly focuses on prominent environmental issues that are closely watched by the central government and aroused strong public resentment, and how the local governments have handled them.
Inspectors will monitor key environmental issues, oversee local improvements and push local government accountability.
Any unqualified factories, once found, will be facing an abundant fine or even shut down. In fact, in the most recent round of factory audits, the environmental action has shut down tens of thousands of Chinese factories with no end in sight.
Companies without proper environmental performance are now in quite big or potentially big trouble. some factories are closing to avoid being inspected, and some are forced to shut down to make improvements. As normal production process was interrupted, or even factories shut down, the whole supply chain has been affected for many industries, this, with no doubt, caused the delay or even terminate in the whole production process.
Large state-owned businesses, local governments and thousands of small private enterprises have been implicated. Even though they may have the required documents or live up to the standard, they are involving in the cooperation with other factories too. Therefore, production in big or state-owned business is suffered as well.
With environmental storm swept China, and packaging and printing factories around the country came to be shut down, which cost the increase of the price of the package, while the package is required in all industries. The situation is the same with many other industries too, the price has increased at least 10%.
It has been the largest-ever national operation in the field of environmental protection in history, and there is no sign of end in the near future. According to Government’s announcement in April, it would be a year long action.
As there is no clear timeline which means the factories don’t know when or if they can resume production, therefore, there is no clear answer about when will the whole production back to normal.
If you have business in these fields, it is very likely that it will be influenced.
Most of the Chinese factories don’t have the awareness of informing their clients about the potential problems. They are more likely to use it as a reason or excuse, it is a fair fact, but knowing before-ahead would sure help you to make corresponding actions.
So it is a smart move to stay in close touch with your suppliers. Not only in this special period, always checking with them about your order’s status will sure help the smooth delivery of your cargo.
Another advice is having a plan B, a plan B for the project, and a plan B supplier would help too, either in China or other countries. As a Chinese old saying goes, you don’t want to put all your eggs in one basket and have them all break with one sudden jolt.
Hebei in China has always been a heavy polluted province in China. Its location is quite near the capital Beijing makes it a key environmental protection inspection area. The two key export industries in this area are steel and ceramic, which are important polluted sources. Therefore, the situation in this area is very severe.
As mentioned in last articles, nearly 90% bone china in China were produced in Tangshan, China, the production of bone china have been badly influenced by the inspection action.
However, this national-wide environment protection inspection action is beyond the control of the factories, and in the long run, it is beneficial to the world’s substantial development.