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Manuela Zoninsein: Circular Economy Demands Cross Border Collaboration


 

By Manuela Zoninsein for IsraelStrategist.com–December 2011

While attending the China Clean Energy Technology Forum on November 19th and 20th in Chengdu, it became clear that China’s commitment to developing a circular economy is opening up opportunities for collaboration between a new slew of countries and the People’s Republic of China (PRC). The forum was co-hosted by the Joint U.S.-China Collaboration on Clean Energy (JUCCCE) along with the China Energy Conservation and Environmental Protection Group (CECEP) in the capital of Sichuan Province. The international presence of a broad spectrum of nations there showed that the U.S. is not the lone operator in this game.

Representatives attending activities surrounding the forum included those from Singapore, who are participating in the Sino-Singapore Tianjin Eco City development; Ricardo Meléndrez-Ortiz, CEO of the International Centre for Trade and Sustainable Development hailing from Colombia; Dr. Richard Hardiman, Fellow at the Harry S. Truman Research Institute for the Advancement of Peace, Senior Lecturer at the Hebrew University of Jerusalem and a visiting scientist at the Weizmann Institute of Science in Israel; and Sigaihisa Yosihoro, Chairman of Yokohama-based JGC Corporation, who proclaimed a new day “in technological innovation without borders in the world.”

Of interest to Israel specifically is the Chinese government’s commitment to a circular economy. This is a model for an industrial economy that aims to be restorative by sourcing materials of a biological nature, or of a technical material that can re-enter the biosphere safely or not at all. This Chinese effort serendipitously coincides with the approval by the Israeli cabinet of a proposal from the Ministers of Environmental Protection and of Industry, Trade and Labor to prepare a national green growth strategy for the period 2012-2012.

In taking on this initiative, the Israeli government demonstrates further commitment to green growth for purposes of domestic development and  competing on the international stage. “Green growth” is defined according to the three pillars of sustainability: environment, economy and people, which is usually taken to entail employment and health. Israel’s new efforts show, moreover, an understanding that if development is to continue with minimal environmental damage, there is a need for a “decoupling of economic growth from environmental deterioration.”

The Chinese Communist Party has drawn a similar conclusion, with Tang Kai, Chief Planner for the national-level Ministry of Housing and Urban-Rural Development (MoHURD), pushing “a sustainable [my italics] economic imperative for China to continue developing.” He further stressed, “There is a mismatch: resources can’t be used forever;however the speed for exploring renewable energy and materials can’t keep up with the pace of construction.” What’s additionally interesting is the integration of this language with that of ensuring a “harmonious society,” a central goal of Premiere Hu Jintao’s administration. The call, from Wang Qingxi, Deputy Chairman of the Environment and Natural Resources Committee of the National People’s Congress, to “focus on technology to enable environmental protection” is moreover consistent with Hu’s call to build an “innovation society.”

Given Israel’s shortage of key natural resources – land, water and oil (until recently at least) for starters – and the nation’s long-lived ability to innovate beyond these materials, Israel and China complement one another nicely in many ways. Of particular interest is cleantech, whether you choose to call it “green growth” or “circular economy.” Israel can provide technology, know-how and innovation, while China’s government-coordinated funding, engineering prowess and massive market can enable a multiplier effect.

Moreover, many of the industries in which China is seeking to advance its capabilities are those in which Israeli technology is a world leader: water conservation, management, tracking and re-use; efficient agricultural techniques; and electric vehicles and renewable energy, including PV and thermal solar.

Three potential obstacles to Israel’s entry loom large on the horizon. The first is concerns intellectual property rights and China’s need to enforce legal standards that protect proprietary technology and know-how for innovative companies, both domestic and foreign. Creative answers are bubbling up but no quick fix or solid solution is yet available. According to Yu Hailong, the General Manager of CECEP, “the government will provide better support for the development and collaboration [to encourage] more technology development spaces.” As part of that, the government claims it will begin cracking down on intellectual property right infringement.

Second, “China only does big projects…it doesn’t know how to focus on small market opportunities,” explained Jigar Shah, CEO of the Carbon War Room and founder of SunEdison. That said, there is a potential opportunity for a smaller nation like Israel to help the PRC transition to “small-capacity projects, learning from [other countries] to diversify and expand supply chains.”

The third issue is simply the question of whether it is possible to develop economically without compromising the environment. The term “circular economy,” coined about 5 years ago according to Dr. Hardiman, will not necessarily prioritize sustainability: “there’s a cost to the environment, and that’s the bottom line.” He points to the morning speaker’s session at the Forum, during which the word “economy” arose more often than “environment.” Admittedly, Chinese government officials are judged according to GDP, not environmental protection, so they remain focused on encouraging economic growth. Until this incentive structure evolves, however, environmental issues will continue to be sacrificed for economics, pure and simple.

Manuela Zoninsein is an environmental reporter based in China. For more, please visit www.manuelasweb.com.