This is the final installment Earl's China Energy Adventure.

 

Earl is not known for his macro-economic expertise but that doesn’t mean he’s not interested and paying attention. The stimulus programs that are being implemented around the world at this time have certainly got his attention.  An article in Business China last week struck a nerve.

 

Zhejiang Province is just to the south of Shanghai. Economists there noticed a weakening of the economy in late 2007 and started to take measures at that time to minimize the impact. Funds were set aside with no clear intention other than wait and see.  With the recent China Central Government announcement of a stimulus package Zhejiang officials decided to utilize their funds for local companies as well.

 

Here’s where it gets interesting. This isn’t a fund where everyone gets a piece of the action. Companies will be evaluated for their utilization of technology and their energy efficiency. Those over the bar get assistance. Those that don’t make the cut will be getting nothing and be allowed to fail. In a sense, it’s survival of the fittest with a twist. Do good and get a boost. 

 

It is clear that Chinese officials recognize that the importance of raising the standards of the companies there. They are not interested in promoting inefficient operations at the risk of dragging down well run companies suffering due to the global economy. The bonus for the rest of the world is reduced carbon emissions and energy demand. Now, if the rest of the world could make some hard decisions and stop catering to bloated, inefficient companies we could get somewhere?