Korea-China Fine Dust Cooperation Was Merely Superficial... 950 Million Won Cut Due to Budget Non-Utilization

Five-Year Korea-China Environmental Technology Demonstration Cooperation Project Shows Minimal Results
Execution Amount Less Than 50%... Budget Cut in National Assembly This Year
Low Contracts Due to THAAD Impact and Narrowed Technology Gap... Support to Be Expanded

On the 11th, when emergency fine dust reduction measures were implemented in the central region including Seoul, the city center viewed from Sejongno Intersection in Jongno-gu, Seoul was shrouded in fine dust. Photo by Jinhyung Kang aymsdream@

[Asia Economy Reporters Kim Bo-kyung and Jang Se-hee] Amid the surge of high-concentration fine dust from the beginning of the new year, it has been confirmed that the fine dust reduction cooperation project between Korea and China, which has been ongoing for five years, was merely superficial. This refers to the "Korea-China Joint Fine Dust Reduction Environmental Technology Demonstration Cooperation Project." Although it was promoted with the aim of reducing fine dust emitted from Chinese factories using Korea's excellent environmental technology, it failed to produce any significant results. Due to repeated budget carryovers and non-use every year, this year's project budget was cut by 950 million KRW.

According to the Ministry of Environment on the 6th, this year's budget for the Korea-China fine dust reduction environmental technology demonstration cooperation project was finally decided at 9.05 billion KRW after a 950 million KRW cut by the National Assembly. This project has been promoted since 2015 as a follow-up measure to the Korea-China summit in July 2014, aiming to reduce fine dust and develop the environmental industries of both countries. It applies Korean companies' air pollution prevention technologies to power plants and workplaces in highly polluted areas such as Tianjin and Hebei Province in China. The project supports companies by covering 20% of the contract amount (up to 4 billion KRW) and is carried out by the Korea Environmental Industry & Technology Institute, a commissioned agency of the Ministry of Environment.

[Image source=Yonhap News]

Although the project was allocated a budget of 10 billion KRW annually, this year marks the first time the budget was cut. Due to repeated budget carryovers and non-use every year, opposition party lawmakers suggested reducing about 10% of the government’s proposed budget during the National Assembly review process. Looking at the annual execution amounts of the Korea-China fine dust reduction technology demonstration cooperation project, less than half of the budget was spent almost every year. In the first year, 2015, only 334 million KRW was executed, and the remaining amount was fully carried over. Execution amounts were 3.6 billion KRW in 2017, 4.3 billion KRW in 2018, and only 4.7 billion KRW as of September last year. Korean companies contracted with the Chinese side numbered five in 2016, six in 2018, and five last year, with none in 2015 and 2017.

An official from the Ministry of Environment said, "Due to the impact of the Terminal High Altitude Area Defense (THAAD) system in 2017, Korean environmental companies faced difficulties in signing contracts," adding, "Recently, there has been little difference in technological capabilities between Chinese and Korean environmental companies, resulting in poor contract performance."

To increase execution performance, the Ministry of Environment is considering expanding government support from 20% to 40% of the contract amount starting this year, while lowering the support limit to 1 billion KRW per company to prevent concentration of support. Additionally, the ministry plans to eliminate the selection process for prospective participating companies and provide support funds after reviewing and confirming contracts made with the Chinese side. Minister of Environment Cho Myung-rae recently stated in his New Year's address, "We will strengthen cooperation projects such as the Korea-China demonstration project and expand policy and information exchanges, especially during high-concentration seasons," emphasizing, "The government must actively demonstrate efforts to resolve fine dust originating from abroad."

This content was produced with the assistance of AI translation services.