"To be or not to be": disclosure leads to low carbon?

Facing climate change, companies have no choice "to be or not to be" involved, but acknowledge and act to lessen their environmental footprint.

The majority of global companies are acting to reduce their emissions, says a 2008 report by the Carbon Disclosure Project (CDP), a London-based independent organisation challenging the world's largest companies to measure and report their carbon emissions since 2000.

Representing 385 investors with assets of $57 trillion, CDP received feedback from 90% of FTSE 100 companies this year, its highest sample rate to date; 74% of the Global 500 respondents reported their emissions-cutting targets.

"A business can only manage what it measures," said Paul Dickinson, CEO of CDP. The project intends to help businesses identify the risks and opportunities from climate change and turn awareness into action.

Toyota said: “We are convinced that only those automakers that successfully solve social problems in environment, congestion and accidents will be allowed to continue existing in society.”

With renewable energy purchases rising 24% in 2006-2007, IBM pledges a 7% global emissions cut in 2005-2010.

News Corporation aims to achieve a 10% emissions cut in 2006-2012 by reducing its use of non-renewable energy sources.

Siemens is promoting Netmeeting software as an alternative tool to travelling.

Wal-Mart is a typical case of carbon disclosure entailing changing corporate behaviour. It only came to realise its refrigerators emit more than its delivery trucks after completing the CDP questionnaire. Carrefour and Tesco have joined Wal-Mart to incorporate their supply chain emissions into their overall strategy.

Funded in 2000, CDP collects key climate change data from more than 1550 major corporations around the globe and has assembled the largest corporate greenhouse gas emissions database in the world. The first data was collected in 2003 and 2008 therefore represents the sixth year of corporate reporting to CDP.

Copyright Dongying Wang

China in Zambia: from comrades to capitalists?

Zambians seek work at the NFC African Mining PLC

It was a scorching day in March 2008. Job seeker Glorence Kandeke, 24, waited anxiously outside a Chinese copper mining company in Chambishi, northern Zambia, in a slim hope of obtaining employment at the NFC African Mining PLC (NFCA).

“I have been travelling about 45km everyday over the past three months for a possible job with the NFCA,” said Kandeke. He said his parents had funded his $5 daily fare to come here. The cost amounts to 15% of the minimum monthly wage for Zambians which stands at 268,800 Kwacha, or $77.

“I don’t know when I will get a job from the NFCA, nor how long my family can support me by paying my fare everyday,” sighed Kandeke.

Kandeke is joined by nearly 75 others everyday who vie for a position in the Chinese company.

“The Chinese said they offer 5 new jobs every day, but nothing lucky has happened to me in the past few months,” Kandeke said.

There are thousands of workers like Kandeke who seek employment in the special economic zone in the Copperbelt. But for those who obtain jobs within Chinese companies, there is an increasing concern that their safety is being compromised and they are being financially exploited.

Chinese investment in Zambia is dwarfed by those of US and European countries, and even some Asian countries. However, China is hailed as an increasingly important investor in this southern African country; a nation which has an unemployment rate as high as 70%.

“Chinese investment in the Zambian mining sector is showing very positive trends,” said Mr. Lennard Nkhata, permanent secretary of the Ministry of Mines and Minerals Development.

Instead of responding directly to criticism by the West over China’s negligence of labor laws, poor environmental record and lack of contribution to the communities of Africa, Mr. Nkhata spoke more positively of China’s role in his country.

“Chinese compliance to health and safety regulations has improved tremendously over the years and the environmental performance of the companies is acceptable so far,” he said. However, he mentioned no specific figures.

The Chambishi NFCA mine, which is running on Chinese technology, is the only large-scale underground mine which has not recorded a fatal accident since October 2006. Mr. Nkahat cited this as an example to show the safety record in Chinese facilities.

Zambia has placed the battle against poverty at the top of its agenda and expects to achieve an economic boom through the mining industry. A new tax regime, it believes, will help achieve this. This measure is due to take effect from April 1, with the Loyalty Tax rising to 3% and the company tax up to 30%.

“Thanks to the huge demand for copper in both China and India, Zambia is enjoying a booming mineral industry,” Mr. Nkahat said.

In 2007, Sino-Zambian bilateral trade stood at $595 million, up nearly 60% from 2006. The figure included $397 million of exports to China from Zambia, most of which were copper.

The permanent secretary said that the increased output resulting from Chinese investment had the potential to bring about an economic boom in Zambia.

It has been widely acknowledged that Chinese investment in Zambia is highly protected by the government.

Zambia’s Environmental Council Senior Communication officer Justin Mukosa said: “We do not want to separate Chinese investment from other investment, and we judge overseas investors by performance.”

And he criticized those who talked down China, saying: “singling out Chinese companies is a political issue more than an environmental one. ”

The Citizens for a Better Environment (CBE), Zambia’s largest environmental NGO based in Kitwe, confirmed that there are no more citizen complaints about Chinese mining companies than other investors.

In fact, there have been serious environmental incidents caused by other countries’ mining firms. Earlier this year, the Mopani Copper Mine, partly owned by a Swiss company, was blamed for polluting water supplies in Mufulira town.

The Zambian Development Agency will soon issue a list of industries into which overseas investment is sought, in a bid to boost national development, the agency’s Investment Promotion Manager Jessica Mwiinga Chombo said. Mining and hydro-electric industries are included on the list, but Ms Chombo failed to elaborate further.

“No discrimination exists between local and foreign investors,” she said, but added that “Zambia expects investors to create jobs and transfer technology and skills for the locals.”

The $220 million Chambishi Copper Smelter （CCS）Ltd, which is under construction in Kitwe, stands as a good example to show how China is fulfilling its commitment in assisting local development.

The smelter is scheduled to go into operation by the end of this year, with an output of 150,000 tonnes of crude copper per year.

Copper ore, as it is extracted from the ground, has a very small copper content. After the first industrial processes, concentration copper is produced with a copper content of around 40%. Smelters turn this into crude copper which is 99% pure.

Building smelters not only reduces outsourcing but also helps increase Zambia’s exports of added-value products, so says Deng Yun, vice director of the smelter’s Administration Department. New smelters will also help create new job opportunities.

“All the crude copper from the new Chambishi smelter will be shipped to China,” Deng Yun said. The smelter is expected to boost Zambia’s exports by $450 million.

“The company will also provide over 1,500 jobs for local people,” said Yun, “There are now about 400 working Chinese and 600 Zambians to build the smelter, and after it goes operational, the number of Chinese workers will decrease to 100,” he explained.

However, Chinese investors are expected to contribute more to Zambia’s society and meet ever higher expectations of Zambians.

John Lungu, economics professor at the Copperbelt University in Kitwe, has called for increased local partnership of Chinese businesses in Zambia to ensure a fairer deal. He also argued that the Sino-Zambian Economic Zone, where both the NFCA and CCS are located, should create not only jobs, but also well-paid jobs.

Professor Lungu’s view is echoed by that of union leaders and miners who often complain about unethical treatment and low wages in Chinese mining companies.

Chilufya Mukuka, head of the Safety Department of the India-funded Chambishi Metals Plc, said that miners working for Chinese companies receive about $70 per month. This is much less than an average of $400 paid by companies from other countries, said Mr Mukuka, who also represents a mine community in Chambishi.

However, Jingtao Liang, an engineer with the NFCA, dismissed the allegation, saying that pay for Zambians averages at $400, with the highest exceeding $3,000.

Though miners’ union leaders fail to give satisfactory explanation of this conflicting information, it is generally agreed that pay varies amongst different categories of jobs.

Standing outside the NFCA, job seeker Kandeke said: “Though the Chinese company pays less, it is better than nothing.”

Kandeke and his countrymen prefer to be employed by the NFCA rather than other foreign companies. They say they would rather work the 8 hours demanded of them by the NFCA than the 12 hours which is commonplace in other foreign companies.

Commenting on the low wages paid out by Chinese companies, Professor Lunga concludes that Chinese investors have transformed from “comrades” to “capitalists” in less than half a century.

His opinion forms a striking contrast to the position of his government which calls China a “genuine and all-weather friend” who is ready to help without preconditions.

Zambia established a diplomatic relationship with China within a week after its independence in 1964, becoming the first country in southern Africa to do so.

The Sino-Zambian friendship culminated in the building of the Tazara Railway which links landlocked Zambia with neighboring Tanzania in the 1970s. It had been the largest foreign-aid project ever undertaken by China. Since then, China has gradually increased its investment within the country. By 2007, China’s direct investment in Zambia had reached nearly $290 million.

However, China represents only a small portion of overseas investment, which Zambia relies on to transform its economy.

Zambia faces the challenge of balancing the interests of foreign investors with the welfare of its people. And solving the problems relating to Chinese companies are only the beginning, as Zambia tests its ability to achieve a balance.

Whilst trying to build up its economy, Zambia needs to introduce effective measures to help protect the well-being of its people and the environment.

Read other China-Africa articles:

Africa pivoted to setting its own agenda

China in Africa: a catalyst for change

Copyright World News Review 2008

For reproduction of the articles, please email: wdy21century@gmail.com

Financial crisis batters global markets despite bailout law

Last Friday's signing of the US historical economic rescue package into law has failed to prevent global stock markets from diving much deeper beyond expectation.

Those who have hoped to see a rise in stock markets this weak were shocked by the extent of the market plunge on Monday. The Dow Jones plummeted 569.8 to 9755.5, penetrating the psychologically important 10,000 mark for the first time since 2004, with the S&P 500 off 64.2 at 1035.0.

Confidence of global investors has been heavily pounded and is unlikely to be restored in the short term. A global economic recession is looming large.

Along with the US $700B bailout package, European nations have sought to close ranks to avert the financial epidemic from the Unites States. However, no tangible progress has been made.

Do you think it is too late for the governments to offer an effective remedy? If not, what do you think they should do?

Europe seeks to coordinate banking system clean-up

Four big European nations have pledged to coordinate efforts for a new regional financial system with improved regulation, supervision and morality, in a response to the credit crunch crisis spreading from the US.

The consensus came after a meeting of heads of state of France, the UK, Germany and Italy as well as senior officials from the European Commission, the European Central Bank and the Eurogroup. Britain, France, Germany and Italy are Europe's representatives on the G8.

French President Nicolas Sarkozy, who convenced the gathering on Saturday, stressed that entrepreneurial capitalism instead of speculation is needed. Italian Prime Minister Silvio Berlusconi said ethics should be brought back to banking systems.

British Premier Gorden Browns said his country will do whatever is necessary to stabilise the financial market, citing the bail out of Northern Rock and other actions. Liquidity will be ensured to preserve confidence, said Mr. Brown, adding that the participants have agreed to ask the European Investment Bank for 25-billion-pound loans for small businesses, clean up the financial system and set up a college of regulators.

Unpopular US bailout plan passed

The revised $700 billion bank bailout plan has been passed by the US House of Representatives by a vote of 263 against 171, in a hope to save the US economy from a collapse caused by the mortgage crisis.

President George Bush said that the legislation was completed in a timely manner and will help prevent the crisis on the Wall Street from becoming a national disaster. World stock markets plunged following the House's rejection of the bill on Monday.

The effect of the bill will take time, and the US still continues facing serious challenges, Bush warned.

Speaker of the US House of Representatives Nancy Pelosi, who signed the bill, said: "The revised bill will benefit American people, especially the middle-classes."

Accountability, regulatory reforms and a focus on the middle-class will top the agenda of the financial system to prevent the US from repeating the same crisis and mistakes, said Pelosi, adding that free markets have created jobs and capitals, but when they are left unregulated and undisciplined, chaos is created.

The passage of the bill has incited negative responses, which call for sending the money to ordinary Americans and mortgage borrowers.