Editors' Pick: Originally Published Friday, Dec. 18
TAIPEI, Taiwan (TheStreet) -- When China sets a target, it always finds some way to meet it. The leadership said it would cut poverty 50% from 1990 to 2005 and the United Nations says that's what happened. China said GDP growth would come in around 7% last year and, sure enough, it did.
Now China is pledging three cuts by 2030 to its world-famous air pollution. To get there as well, it will need help from a multitude of multinationals.
Chinese authorities are expected to seek help from green technology firms and may get tougher on companies that add to China's notorious smog problem. Wind and solar energy would get powered up, while makers of low-emission vehicles see new demand.
China agreed, as part of an international climate agreement signed by 195 countries last week in Paris, to cut carbon intensity to 60% below 2005 levels by 2030. By the same year it would raise non-fossil fuel sources to 20% of its energy and reach a greenhouse gas emission ceiling.
Foreign businesses already anticipate the warm wind of money from any help they can offer the world's biggest emitter of carbon dioxide.
"The Paris Agreement has given a clear signal to EU businesses in China to scale up innovation and investment in climate solutions," Joerg Wuttke, president of the European Union Chamber of Commerce in China, said in a statement Thursday.
"We now strongly encourage the relevant Chinese government agencies to closely engage with the business community at large in order to facilitate successful implementation," he said.
That might specifically mean tapping listed companies Siemens (SIEGY) and Honeywell (HON) for low-emission buildings, as both have strong records of working in China. But despite the European chamber's plea, China has been looking more to boost its own firms lately as new pillar of the shifting, slower-growing economy.
"In terms of foreign companies stepping in for China to reach their goals, China may not need them," said Matthew Rowett, admissions director with business consultancy and study-abroad organizer CCRC Asia. Chinese private and government investment, he said, is "funneling into these industries."
Coal-fired energy would take another step into history as China steers more toward solar, wind, hydropower and nuclear energy. China's nuclear power capacity of 14 gigawatts two years ago will grow to 58 gigawatts by 2020, American non-governmental organization Center for Climate and Energy Solutions says.
China may also double up enforcement against polluters, although analysts expect resistance from fast-growing provinces in central and western China. State-run media have singled out China-based, U.S.-traded oil firms Sinopec (SHI) and Petro China (PTR) earlier this year as law-enforcement targets.
Foreign companies may win from the climate control effort if they sell electric vehicles. State policy could send orders to the likes of electric car makers Nissan (NSANY) or the locally based, Hong Kong-listed BYD Auto.
Another ally meeting China's 2030 goals may be the economic slowdown, said Gordon Chang, an author on Chinese economics and politics. If export demand slows, Chinese citizens cut back spending and fewer goods are produced, smokestacks would power off in response.
"China, for reasons it does not now anticipate, will become a model carbon citizen, no longer the world's top emitter," Chang said. "Therefore, there is little the Chinese leadership needs to do to meet its most important climate obligation, to cap emissions."