Since Global Economic Crisis in 2008, many developed countries and regions have adopted a series of measures to revitalize the manufacturing industry. For example, the United States has initiated a project named "Advanced Manufacturing Partnership” to solidify its leading position in world markets. Besides, the European Union has been working on re-industrialization aiming at enabling manufacturing to be clean, modern and advanced. In the global value chain, the China’s manufacturing industry is still positioned at the low-end, undertaking those manufacturing activities with low added-value, high resource consumption and high pollution level [1
]. The core competitiveness for China’s manufacturing industry mainly depends on cheap labor force and environmental costs. As a pillar industry of China’s national economy, manufacturing industry has contributed to one third of GDP, 90% of total exports, and one third of China’s state revenue. Moreover, it has furnished employment to more than 80 million Chinese people [2
]. Despite being the main driving force of China’s economic growth, manufacturing industry consumes much energy and discharges massive pollution. Since 2000, China’s manufacturing industry accounts for 51% of the national energy consumption and 52% of the total industrial exhaust emission [3
]. The high-speed economic development of China has often been achieved at the expense of the environment. Thus it is significant for China’s manufacturing industry to transform its resource-consuming and extensive growth into green growth.
The origin of green growth can be traced back to the Green Movement in 1960s, but until 2005, the concept of “green growth” was formally brought forward at the 5th Ministerial Conference on Environment and Development in Asia and the Pacific organized by UNESCAP. The meeting identified “green growth” as a critical path to balance the three pillars of sustainable development [4
]. As a way to solve the energy crisis as well as to achieve social and economic development, green growth is in the ascendant throughout the world [5
]. In 2007, Ireland invested over EUR 1.3 billion in projects with a direct impact on promoting environmental sustainability. In 2009, the South Korea issued “National Green Growth Strategy”, aiming at “Mitigation of climate change & energy independence” [6
]. Facing the increasingly worsening environment problems, Chinese government has recognized the importance of transformation of economic growth model. A series of national initiatives for green development was carried out, including ecological industrial park, circular economy pilot projects and low-carbon pilot city. And at the 18th National Congress of the Chinese Communist Party in 2012, promoting green, cyclic and low-carbon development was again emphasized. Furthermore, “green”, as one of five development philosophies, was called for in China’s 13th Five Year Plan. All above mentioned show the determination of the Chinese central government to move on through green growth.
In this context, it makes sense to promote green growth for the manufacturing industry and even for the national economy. The evaluation of green growth efficiency will strengthen this process. Hence, it is crucial to establish a comprehensive index system to evaluate the green growth efficiency of manufacturing industry. This calls for studies that aid green growth efficiency calculation. Although a lot of related researches have been done, a single index (carbon dioxide or sulfur dioxide emissions) was usually used to evaluate environmental pollution in the previous studies [2
], which is in contradiction with the complexity of pollutant components. As a useful complement to existing researches, this study tries to combine multiple indicators to establish an environmental pollutant composite index and employs the EBM model to measure the green growth efficiency for manufacturing industries in China. The inputs include labor, capitals and energy while the gross industrial output and the environmental pollutant composite index are taken as the desirable output and the undesirable output, respectively. This study offers a comprehensive available tool for measuring green growth efficiency of the manufacturing industry, and the results will offer helpful information for both government and enterprises in their process of the environmental policy-making and its implementation.
This paper is organized as follows. Section 2
provides a review of the existing literature on Chinese manufacturing industry and green growth of manufacturing industry. Section 3
outlines the methodology and the selection of related indicators. Section 4
summarizes the data and presents research results. Section 5
presents discussions and conclusion.
5. Discussion and Conclusions
For the sustainable development of manufacturing industry, it is important to obtain a further understanding of green growth efficiency evaluation toward manufacturing industry. This study measures green growth efficiency of 30 Chinese manufacturing industries using the EBM model, with labor, capitals and energy as inputs and the gross industrial output and an environmental pollutant composite index as outputs, respectively.
First from an overall perspective, according to the result of the EBM model, there is a steady upward trend in the green growth efficiency of the whole manufacturing industry since 2003 (0.625) to 2011 (0.796), with an annual growth rate of 1.9%, as shown in Figure 1
. It is worth noting that there is a relatively rapid growth between 2005 and 2006. In 2005, the Chinese Government for the first time formally puts forward the idea of manufacturing pollution control in “Work of the State Council in 2005”. Over the same period, the environmental pressures from abroad also caused shockwaves to the domestic manufacturing industry. As an example, the WEEE and RoHS directives issued by European Union limited the use of hazardous substances in the production of importing electronic and electrical products [44
]. Thus, it is inferred that the rapid growth in 2005 and 2006 has much to do with the issues of new policies. But the policies didn’t lead to a sustained stimulus on green growth efficiency. Since 2006, the average growth efficiency returned to its original state of slow-growing.
In order to effectively conduct the industry-based analysis, we classify Chinese 30 manufacturing industries into four types—“green”, “light brown”, “dark brown” and “black” industries according to the clustering results. And the annual trends of 30 manufacturing industries’ green growth efficiencies grouped together by their types are shown in Figure 2
The nine “green” industries possess high green growth efficiency in the nine years. We can see that five of them are capital-intensive industries, namely Cultural, educational and sports goods, Petroleum processing, coking and nuclear fuel processing, Telecommunication equipment, computer and other electronic equipment, Electrical equipment and machinery and Smelting and pressing of ferrous metals. These industries have a huge demand for funds and possess high entry barriers and high monopoly degree. Enjoying strong economics, these industries have the power to invest in new technology, optimize the manufacturing process and update productive equipment.
Among the nine industries, Furniture Manufacturing, Tobacco Processing, Reclaiming and Processing of Abandoned Resource and Waste Material, Cultural, Educational and Sports Goods are typically “green” industries with less pollutant emission, according to the environmental pollutant composite index in the previous section. However, it’s a question worthy of consideration that Petroleum processing, coking and nuclear fuel processing, Leather, Furs, Down and Related Products, Smelting and Pressing of Ferrous Metals are “green”, as they are all members of the top ten of pollution-intensive industries. The reason why the above three pollution-intensive industries turn “green” is the positive measures adopted by the government and enterprises. Take the case of petroleum processing and coking industry, in terms of national policy, a series of policies and measures have been issued for guiding such heavy polluting industries, such as State issue  No. 11 and State issue  No. 15, etc. These policies are mainly carried out from two aspects. On the one hand, the government restrains the extensive growth mode of these industries by the means of taxation, industry standard, differential power price. On the other hand, the government encouraged industries to upgrade industrial structure and adjust energy structure. From the perspective of enterprises, PetroChina Co Ltd. (Beijing, China), as the industry leader, has made great contributions to promote green growth of the industry. In the period of 12th five year plan, PetroChina has reduced its cumulative emissions of carbon dioxide by 744 million tons and sulfur dioxide by 11.62 million tons. PetroChina has been committed to building a sustainable energy supply system. The enterprise had upgraded the oil quality twice in the five years, with a total investment of more than 35.6 billion Yuan [45
]. At the same time, through Ten Major Energy-Saving Projects and Ten Emission-Reducing Projects, Petro China tries to achieve energy-saving and emission-reducing in the production process. Technical innovation plays a vital role in its green growth process. A series of techniques were carried out in Huabei Oilfield, including 2D seismic fine structure interpretation of coal bed methane, enrichment region evaluation and well deployment, solving the problem of strong adsorption capacity and high gas content in high rank coal seam [46
]. The petroleum equipment is one of the key factors of energy saving and emission reducing. PetroChina has carried out special facility development planning to promote the utilization of clean energy in petroleum processing. Besides, PetroChina has been put forward to accelerate the upgrade of traditional advantage facilities and eliminate high-pollution equipments. The Government provides an attractive development environment and enterprises increase green investment. The combination of the two successfully promotes the green transformation of the industry. The experience and measures from the “green” industries are worth references to other industries in their way of green transformation.
There are three technologies-intensive industries in the “light brown” group, namely Transport equipment manufacturing, Handicraft articles and other manufacture and Instruments, meters, cultural and office machinery. These technologies-intensive industry own advanced production technology and manufacturing facilities. Meanwhile, the proportion of R&D expense and the number of sci-tech workers are both above the national average.
Among five “brown” industries, raw chemical materials and chemical products are both high energy-consuming and pollution-intensive industry. Ordinary machinery manufacturing and for special purpose equipment manufacturing belongs to labor-intensive industries, which rely much on cheap labor and have relatively backward technology and outdated facilities. Technical problems also exist in Plastic products and Metal products, such as lack of advanced facilities, shortage of talents and low technology content of products, etc.
Five of the “black” industries are pollution-intensive industries, namely Papermaking and paper products, Textile industry, Food production, Medical and pharmaceutical products and Beverage production. These five industries generate large quantities of waste water, waste gas and solid waste, contaminating the air, water, soil and sea. Another three industries—Rubber products, Chemical fiber and Timber processing, Bamboo, cane, palm fiber and straw products—are labor-intensive industries based on traditional manufacturing. Depending on cheap labor in China, these industries’ growth presents extensive feature, resulting in low added-value and serious environment pollution. The last one, Nonmetal mineral products, as one of the six energy-intensive industries in China, consumes masses of nonmetallic mineral resources as the basic material as well as energy like coal, gas, and oil in the whole manufacturing process.
Based on the four types of industries, government should take various measures to speed up the course of green growth of China’s manufacturing industry. It is critical to promote the transformation from “black” industries to “green” industries by means of policies and regulations. On the one hand, government should restrict the environmental performance of manufacturing enterprises by environmental regulations. The approach taken in developed countries is worth learning. Take the industry of papermaking and paper products as an example, Finland has been doing well in the pollution control by good and close co-operation between the industry and government. Strict regulations and emission limits forced enterprises to improve pollution treatment such as biological treatment facility, reduction of phosphorous emission and closed water loop. The related environmental laws and regulations play a very important role in intervening directly in environmental behaviors during the manufacturing production, which is an effective solution to environmental problems [47
]. On the other hand, an environmental policy can guide green technology innovation. Previous studies have shown the positive effect of the demand-pull and technology-push policy mix and public R&D subsidy on green innovation [48
]. For instance, the government should strengthen policy support for “green” industry by the means of fiscal subsidies and introduction of new technology. These policies encourage “green” industry enterprises cultivate green technical personnel, increase investment in R&D, implement sustainable production practices and take initiatives to undertake social responsibilities.
To achieve green growth, besides the formulation and implementation of policies, manufacturing enterprise themselves ought to take action to minimize energy consumption and environmental pollution. Compliance with regulations, driving force of sci-tech and commitment from the top management is essential drivers in enterprises’ green practice [51
]. Hence, above all, senior managers should improve their awareness in environmental social responsibility. It’s essential to construct a green enterprise culture by conducting awareness-raising activities within the enterprise. Next, enterprises should improve administration and rearrange the organization structure to meet clean production need. Moreover, correlative regulations and standards should be strictly implemented when arranging production, so as to set up a good enterprise image. Finally, enterprises should emphasize green technical innovation by introducing clean production techniques, increasing R&D investment and upgrading manufacturing equipment.
This paper measures the green growth efficiency of the manufacturing industry in China employing the EBM model which accounts for both desirable and undesirable outputs. The study takes into account waste water, waste gas and solid waste together with synthetically reflect the environmental indicator. The empirical evidence in this study may offer some insights in relation to policies and regulations with regards to green growth of manufacturing industries. This study is only a first step towards measuring green growth efficiency of Chinese manufacturing industry. Several important extensions of this work are recommended for future research. A more comprehensive assessment framework, including the social indicators such as employment, work-related injuries and health expenditures, is needed to construct in future work so as to emphasize the role of society in sustainable development. In addition, similar studies can be conducted in other countries, especially for developed countries, in order to find out the gap and then put forward targeted improvements for China’s manufacturing industry.