Shanghai’s smog gives expats second thoughts

Shanghai’s smog gives expats second thoughts

Saturday, December 7, 2013 – 12:03

Matt Hodges

China Daily/Asia News Network

SHANGHAI – Record pollution levels that saw Shanghai engulfed by acrid smog on Friday caused flight cancelations, shortages of face masks and made some expatriates reconsider their long-term plans to stay in the city.“It’s horrifying. I’ve never seen anything like this. I feel like I’ve had a constant hangover for four days,” said Tom Duvalier of Chicago. “If you go down into the subway system, the same smell is in the air. It’s everywhere.”

The air quality index measured by the Shanghai Environmental Monitoring Center stood at 482 as of 6 pm, while the US Consulate gauged it at 503 at 2 pm – a reading “beyond the index”. Levels above 300 are considered “hazardous”.

It was the highest level of pollution recorded since Shanghai set up its measuring system last December, beating records set on Monday and Thursday, local media reported.

The smog in Shanghai follows severe pollution that affected Beijing and Harbin in Heilongjiang province in recent months.

A British expatriate working in the financial sector in Shanghai said: “The pollution is the talk of the office. People are asking if it’s cancerous, reminding everyone to wear their face masks and saying that babies should not be taken outside.

“There are no masks left in 7-Eleven. They’ve sold out. People are saying that if it continues like this, they’re not sure if they want to stay here long-term.”

The Shanghai meteorological department forecast that a cold front from northern China will bring winds to blow the dust particles out of the city by Monday.

To reduce emissions, the municipal authorities issued a notice in the afternoon, halting production at some industrial enterprises temporarily and at outdoor construction projects.

It also removed one in three government cars from the roads. Shanghai is one of a handful of Chinese cities with more than 2 million cars.

The severe pollution has triggered fears that companies in the city will struggle to attract high-quality overseas talent.

Some analysts feel it will deter foreign companies from investing in the recently opened China (Shanghai) Pilot Free Trade Zone, where economic reforms are expected to be tested.

Ioana Kraft, general manager of the Shanghai office of the European Union Chamber of Commerce in China, said, “While members leave for all sorts of reasons, we inevitably hear nearly every time that one of the contributing reasons is the air pollution.”

Canadians Leslie Dolman, who recently left her administrative job at Xi’an Jiaotong-Liverpool University in Suzhou, and her daughter Lena are on a month-long tour of China.

“They asked me two months ago if I wanted to stay and this was one of the main reasons I declined,” Dolman said. “But what surprises me is that China’s been quite open about it.”

Noticeably more Chinese and foreigners were wearing masks in Shanghai on Friday. But some younger Chinese who had been wearing masks all week abandoned them in despair at how bad the situation had become.

Several businesses in Tianzifang, a labyrinth of restaurants, boutiques and handicraft shops in the downtown area that is usually bustling with expatriates and tourists, said they are losing business.

“We’re usually full at this time,” said Kenny Shen, manager of Kommune, a cafe popular among foreigners and which has a large outdoor terrace. The place was almost empty at lunchtime. “Everyone that does come is dressed like a doctor,” Shen said, referring to the face masks.

While school classes were cancelled for the second day in Nanjing, the capital of neighbouring Jiangsu province, classes were not disrupted in Shanghai. Nanjing had an air quality index reading of about 370 by mid-afternoon.

The weather was also putting outdoor charity events at risk, with the Shangri-La Hotel changing the final leg of its “Ride for Hope” – a Shenzhen-to-Shanghai event – so that only six, instead of 50, cyclists will continue from Suzhou on Saturday.

While the weather conditions were bad news for most people, they caused some stocks to rally. Shanghai-listed Keda Industrial, an environmental protection equipment maker, rose by 5 per cent to 21.17 yuan (S$4.34) a share. Shenzhen-listed Wuhu Conch Profiles and Science, which supplies environmentally friendly building materials, rose by 6.29 per cent to 7.34 yuan.

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (, the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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