Emissions Trading - Hong Kong

can emissions trading clear HONg Kong's sky?

Budget Essay

Word Count: 2278

TABLE OF CONTENTS

INTRODUCTION…………………………………………………………………1

WHAT IS EMISSIONS TRADING?..……………………………………………2

2.1 WHY EMISSIONS TRADING?.......................................................................2

3.0 ANALYSIS OF EMISSIONS TRADING PILOT SCHEME FOR HONG

KONG AND GUANGDONG……………………………………………………..3

PROGRESS AND RESULTS FROM OTHER COUNTRIES EMISSION TRADING SCHEMES……………………………………………………………4

POTENTIAL OUTCOMES FROM IMPLEMENTATION OF THE PILOT SCHEME…………………………………………………………………………..5

APPENDIX 1: ECONOMIC ANALYSIS OF 'CAP AND TRADE' SCHEME……..6

LIST OF REFERENCES………………………………………………………...……7

INTORODUCTION

In recent years, concerns over air pollution have been dominated and overshadowed by the more imminent crises of the Asian Financial Crisis and SARS. This has been further compounded by the fact that on a regional basis, Hong Kong's air pollution has been relatively mild compared to China which boasts 16 of the 20 most polluted cities in the world (Impact Lab, 2006).

Nevertheless, Hong Kong's air quality continues to worsen to 32 percent lower than the minimum standard set by the WHO, and currently the city does not even meet its own 1987 air quality standards (China Environment Forum, 2007).

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Figure 2

The Air Quality Objectives Concern Group (AQOCG) estimates 64,200 hospital admissions (176 per day), as well as 6.9 million annual trips to the doctor - one per resident of Hong Kong, are due to air quality-related illnesses (AQOCG, 2006: 10). Additionally, there are 1006 air pollution related deaths per year in Hong Kong. These serious health outcomes result in annual losses of over HK$2 billion in direct healthcare costs and productivity losses of HK$19 billion (AQOCG, 2006: 12).

Hong Kong's poor air quality also threatens its status as the economic and financial hub of Asia. Merrill Lynch recently made the recommendation to investors to switch their real estate investments from Hong Kong to Singapore (a city with significantly cleaner air) as skilled professionals depart Hong Kong because of the dirty air...