(Xinhua)
Updated: 2008-03-19 21:03

 In the past, once a serious environmental incident happened, the company responsible usually resorted to bankruptcy in face of the huge compensation and pollution control expenses. Victims usually couldn't get timely compensation, and the government had to earmark huge funds to rectify the situation. The green insurance system was expected to solve the problem.

In addition to the "green insurance system", China has also adopted a "green credit policy" and a "green securities policy" to curb pollution.

The "green credit policy" instructed banks to stop making loans to high-energy consuming and polluting industries.

According to the policy, not only companies causing heavy pollution and wasting energy are disqualified from getting loans, companies that already have loans, but are later discovered to have violated environmental protection regulations will also have their loans called in.

The "green securities policy" stipulated that highly polluting companies must pass environmental inspections when applying for an initial public offering (IPO) or re-financing.

China is in a period of "high incidence of environmental pollution accidents", Pan has said. Altogether, 108 cases of emergent environmental incidents were reported in 2007, with one case every two days on average.

SEPA figures show 81 percent of the country's 7,555 large-scale heavy chemical projects are in environmentally-sensitive areas that are densely populated or adjacent to neighboring rivers, while 45 percent are "sources with serious risks".

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