China to double investment in environmental protection to $454bn

China has announced it plans to invest up to $454bn (£274bn) in environmental protection in the five years to 2015, with about one third earmarked for pollution control facilities.

"In the near future, China's environmental investment will exceed that of the US and Japan," Liu Zhiquan, an official with the Ministry of Environmental Protection, told the state-run People’s Daily newspaper yesterday.

The amount is double the $200bn allocated for the five-year period covering 2006-10, which was bolstered with an additional $44bn from the government's economic stimulus package.

About a third – or $146bn – of the planned $454bn investment "will be put into the construction of pollution control facilities", said Liu, although he failed to elaborate on what technologies would be covered by such investments.

However, Century Securities analyst Yan Biao told Bloomberg earlier this week that "the increase in spending will benefit equipment manufacturers in water treatment, air pollution control and also developers in the renewable energy sector".

China views products and services related to environmental protection as a burgeoning industry, with government figures forecasting an annual growth rate of between 15 and 20 per cent in the next few years.

"Investment in environmental protection can drive GDP growth effectively," said Liu.

China's announcement comes just weeks before the UN climate change talks in Copenhagen next month. As the world’s biggest polluter, China is under international pressure to set an emissions target.

However, president Hu Jintao has so far only promised to reduce China's carbon intensity – the amount of emissions produced per dollar of economic activity – "by a notable margin".

The nation is slated to announce a carbon-intensity reduction target within the next few days, with analysts anticipating it will fall between 40 and 45 per cent – roughly equal to a business-as-usual emissions trajectory – by 2020.