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China will build a metal eco-city in its southern region in collaboration with Germany to restructure the heavy-polluting metal industry in the area, as the world's No. 2 economy tries to balance expansion with sustainability and increase environmental awareness, Nanfang Daily reported Tuesday.
The preliminary planning of the China-Germany Southern (Jieyang) Metal Eco-City is nearing its completion and construction of the eco-city's technological innovation base for the metal industry will start soon, the report said.
When completed, the eco-city will boast state-of-the-art technology in the metal industry, with an annual production expected to exceed 100 billion yuan.
In Jieyang, a less developed area in the affluent Guangdong province, there are 7,608 small metal manufacturers, with a combined annual production of more than 58 billion yuan. The metal industry there used to have an important position in China and it was an important industry group in Guangdong in its own right.
However, the industry bore the brunt of the international financial crisis as demand for the cheap metal products it made slumped.
The paper says that the best way out for the industry is to increase its added value and curb pollution using overseas technology, as China is putting more emphasis on sustainability while grappling with a host of environmental issues that result from its surging growth.
Guangdong governor Zhu Xiaodan reached an agreement in February with Rudolf Scharping, CEO of RSBK GmbH to develop the China-Germany metal eco-city in Jieyang.
"The metal industry in Jieyang needs to break the bottleneck that has impeded its development. The advantages offered by the German side meet this demand very well," Scharping told Nanfang Daily in April when he visited China and attended the Fourth China-Europe High-level Political Parties Forum.
Wu Kedong, chairman of the Metal Enterprises Union of Jieyang in Guangdong, welcomed the German move.
"Germany produces high added value in its metal industry, while Jieyang reflects an obsolete industry. We should learn from the German side," Wu said.
Details on the actual cooperation will need to be further negotiated. "One field to cooperate in is technology. We will bring German technology to Jieyang. Another field is vocational education, helping train capable metal workers here," Scharping said.
For German enterprises facing a slowing economy, it is a good opportunity to improve their bottom lines. "German enterprises hope to explore opportunities to expand their business outside Europe," Scharping said. "It will be a typical example in China’s industrial modernization drive."
For the Chinese side, the partnership was led by the Metal Enterprises Union of Jieyang in Guangdong, instead of by the government. "This is a good mechanism. If it succeeds in Jieyang, it will set an example for the rest of China," Scharping told Nanfang Daily.
The union was set up in June 2012 to restructure the industry in the city. Subsequently that September the investment fund for the metal industry was set up by the union and raised one billion yuan from union members. Such a financial move in a city like Jieyang is quite rare in China.