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1. Project Summary and Relationship to China's Agenda 21

The goals of this project are, i) the implementation of cleaner production (CP) in representative pharmaceutical companies in Beijing and, ii) the establishment of an information base to facilitate, a) the introduction of CP throughout Beijing's pharmaceutical industry and b) pilot projects in other areas and industries. Project activities include: identification of CP technologies; education and training; setting up demonstration projects; monitoring and auditing.

The project is based on programme area 12B and is related to programme areas 12D, 13B, 14C, 18A and 19A in China's Agenda 21.

2. Background

Beijing Municipality has a population of 11 million and covers an area of 16,800 square kilometres. In 1990, waste water discharges totalled 837 million tons, and waste gas emissions 277 billion m(. The major polluting enterprises of Beijing's pharmaceutical industry discharged 4.16 million tons waste water out of the total water consumption of 21.88 million tons. However, the waste water treatment rate for the pharmaceutical industry is as low as 0.01% and only 2.67% of treated waste water meets the state discharge standards. The annual discharges of the pharmaceutical industry amount to 1,347 tons of COD, 442 tons of BOD and 152 tons of SS. The pharmaceutical industry is also a major source of volatile phenol emissions in Beijing, accounting for 5.7 tons per year. On average, for every RMB 10,000 yuan of output, 70 tons of wastewater and 0.026 tons of COD are produced. Theses high figures indicate that the industry has a great potential for the development of CP.

The project initially aims to improve management, competitiveness and economic efficiency by implementing CP pilot projects in representative enterprises( including No. 1 Branch of Beijing Pharmaceutical Factory, No. 2 Pharmaceutical Factory, and Beijing Biochemical Pharmaceutical Factory) that are major users of industrial water. In so doing, both the main obstacles and the potential of CP will be ascertained and an information base established. The experiences of developing CP in the pharmaceutical industry will contribute to the future promotion of CP in other industries.

The sustainable development strategy has been determined by the Chinese Government. This strategy requires two fundamental transformations in the economic system and the means of pursuing economic growth. CP is seen by both Government and industry as central to realising sustainable development and improving these two fundamental transformations. CP is an important objective of both the Ninth Five-Year Plan and Long-term Target of Beijing for the Year 2010. CP is also a major focus of the implementation of China's Agenda 21 in Beijing. Since 1993, CP projects have been implemented in 30 workshops or production lines of 26 enterprises in 14 industries in Beijing. A total of 655 CP options have been generated by these 26 enterprises, of which 250 primarily involve improving management, and 217 involve modifications to equipment and technologies. By the end of 1995, 363 of these options had been implemented. These implementations reduced waste water and COD discharges by 1.65 million tons and 3,201 tons respectively, and saved 366,000 tons of water and 38.4 million RMB. It is expected that COD discharges will have been reduced by 3,248 tons with savings of 100 million RMB after implementation of all options. During the first three years, 1994-1995, many methods of CP have been proven in practice, and groups of CP experts have been trained, and much experience has been accumulated in the dissemination of CP technologies. A set of practical guidelines is being developed based on the experience of developing CP in Beijing. A good foundation has been established for the implementation of CP in Beijing's pharmaceutical industry.

The Beijing Municipal Training Centre for Environmental Protection Technology, as one of the implementing agencies, has acquired much valuable experience in the development of CP. In 1995, a Norwegian-Chinese "Transfer of Know-how Program on Cleaner Production" was successfully carried out and won the approval of the enterprises and departments involved. In 1996, the centre participated in the "Adjustment of industrial construction and implementation of CP in Benxi city" program.

3. Objectives

3.1 Long-term Objective

To formulate practical policy for promoting CP in various industries; to establish standard CP systems in enterprises; to compile practice guidelines for CP; to improve technical co-operation and information exchange by implementing CP in Beijing enterprises.

3.2 Immediate Objectives

• To develop training in, and auditing of, CP; to train 20 CP experts with abundant experience in Beijing's pharmaceutical industry;
• To implement CP demonstration projects, and set up some model enterprises in the pharmaceutical industry of Beijing;
• To compile CP practice guidelines for the pharmaceutical industry;
• To promote co-operation and information exchange on CP.

4. Outputs and Activities

4.1 Training and auditing of CP in the pharmaceutical industry of Beijing

• To organise three one-week training courses for 40 persons from 5 pharmaceutical enterprises, namely, Beijing No. 4 Pharmaceutical Factory, Beijing Pharmaceutical Factory, Beijing No. 2 Pharmaceutical Factory, Beijing No. 3 Pharmaceutical Factory and Beijing Biochemical Pharmaceutical Factory;
• To conduct a one-year audit of CP in these 5 factories.

Monitoring Indicators: Organising CP training for 40 persons from 5 pharmaceutical enterprises and compiling audit reports for these enterprises. 20 technical persons will have been highly trained in CP in the pharmaceutical industry.

Implementing Agencies: Beijing Municipal Training Centre for Environmental Protection Technology and 5 involved pharmaceutical enterprises in co-operation with Beijing Leader Group Office for the Implementation of China's Agenda 21.

Time Schedule: January 1997 - June 1998

4.2 CP pilot project of vinyl chloride (VC) products in Beijing Pharmaceutical Factory

• To identify and generate CP options for the VC production-line based on the CP audit;
• To reduce waste liquid discharges in the process of VC production by recycling and reusing waste liquid containing bacteria;
• To reduce air pollution and harm to human health caused by methyl alcohol, by utilising the cleaner production technology of 2-step fermentation on VC products and eliminating the acidification process;
• To reduce solid waste generated during the process of VC production by the comprehensive utilisation of activated carbon containing bacteria;
• To analyse environmental and economic results after implementation of the selected options.

Monitoring Indicator: accomplishment of technical modifications and the pollution reduction objectives

Implementing Agencies: Beijing pharmaceutical Plant and Beijing Municipal Training Centre for Environmental Protection Technology

Time Schedule: October 1997 - October 2000

4.3 CP pilot project in the raw material workshop of Beijing No. 2 Pharmaceutical Plant

• To identify CP options for the raw materials workshop based on a CP audit;
• To introduce key techniques and equipment to produce isoniazid, sulphadimethylthiazole and sulfamidine;
• To identify and implement other CP options;
• To analyse the environmental and social results of the implemented pilot project.

Monitoring Indicators: accomplishment of technical modifications and the pollution reduction objectives

Implementing Agencies: Beijing No. 2 Pharmaceutical Factory and The Beijing Municipal Training Centre for Environmental Protection Technology

Time Schedule: October 1997 - October 2000

4.4 Dissemination of cleaner production experiences in the pharmaceutical industry

• To hold an international workshop of 80 participants on the implementation of CP projects in the pharmaceutical industry and to investigate the CP situation in foreign pharmaceutical industries;
• To formulate guidelines for the implementation of CP suited to circumstances in China, and to establish a database and management information exchange system for CP in the pharmaceutical industry;
• To develop a relationship with ICPIC of UNEP in the interests of information exchange and co-operation on CP;
• To disseminate CP knowledge and experience among other industries.

Monitoring Indicators: Completion of a report on the implementation of CP in foreign pharmaceutical industries; formulation of implementation guidelines for the pharmaceutical industry; the development of the software for a CP technical database and information exchange system in the pharmaceutical industry

Implementing Agency: the Beijing Municipal Training Centre for Environmental Protection Technology

Time Schedule: October 1997 - April 1999

5. Inputs

5.1 Chinese inputs

Funds primarily to cover: partial costs of domestic CP training; operating costs of the development of CP; costs of demonstration projects; development of CP information exchange system; services and management expenses, etc.

5.2 International inputs Funds to cover the expenses of inviting CP experts, the acquisition of technology and equipment of cleaner production in the pharmaceutical industry, etc.

5.3 Budget

The total capital needed for this project is US$ 7.5 million. The Chinese participants will raise US$ 1.2 million from domestic sources, while foreign aid and investment will cover the other US$ 6.3 million.

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Table 1. Budget by Item (in million US dollars)

Table 2. Budget by Output (in million US dollars)

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6. Benefits

Experience of the introduction in CP in Beijing shows that cost-benefit ratios are generally very high, sometimes reaching 1:20. It is therefore a good investment in direct terms. The adoption of CP could bring significant economic benefits to the whole of Beijing's pharmaceutical industry.

Experience also shows that the use of CP can reduce a factory's pollutant discharges by 10-30%. It is anticipated that the adoption of CP by the whole of Beijing's pharmaceutical industry would reduce waste water discharges by 0.41-1.25 million tons. This would greatly improve the city's environmental quality in Beijing city.

7. Risks

The successful implementation of this project faces three major obstacles:

i) Most managers have little knowledge of ,or confidence in, CP technologies;

ii) There is insufficient information exchange on CP in China;

iii) There are insufficient funds available to support the introduction in enterprises.

These problems should be addressed in the following ways:

i) Comprehensive information on CP should be acquired by managers through the provision of written materials, meetings and visits to factories that have adopted CP practices;

ii) A system for collecting, collating and disseminating the latest developments in CP should be developed;

iii) Funds should be provided to enterprises for their CP programs. Given that the adoption of CP brings direct economic benefit to many companies, these funds could often take the form of revolving credits with steadily increasing volume.

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