Beijing Pollution: How Bad Does It Have to Get for a Red Alert?

Feb 26, 2014

Beijing Pollution: How Bad Does It Have to Get for a Red Alert?

Beijing authorities have maintained an orange alert—the second-highest warning—for six days amid a stretch of bad air pollution.

That has a number of residents wondering: Just how bad does it have to get before the local government raises its warnings into the red?

A red alert is issued only when authorities forecast an air-quality index of above 300 for at least three consecutive days. It includes extra measures such as implementing alternate-driving days for cars with even- and odd-numbered license plates, an additional round of road spraying to trap dust and reducing the number of government vehicles on the road by 30%.

“Do we have to wait until the streets are lined with dead bodies before a red alert is issued?” asked one user of Sina Corp.SINA -10.29%’s Weibo Twitter-like microblogging platform.

The questions came as Chinese officialdom began to show sensitivity to sometimes-critical coverage of a week of putrid air even from the most tightly controlled media outlets. On Friday, state broadcaster China Central Television banned some of its employees from talking about the latest round of bad air on social media, according to a text message seen by China Real Time.

“Whether you use an official or private Weibo account, don’t post content about the Beijing smog. Thank you!” the message said.

CCTV’s directive follows an incident earlier this month, when the official Weibo account of the station’s finance channel posted maverick comments criticizing Beijing’s lack of response during another particularly bad stretch of air quality.

“CCTV Finance is issuing a wakeup call: The government can’t act blind; it must bear the burden of responsibility, protect its territory and not act ignorant,” the post said. “How severe must the pollution get before the emergency response goes into effect?”

The posts were later deleted. A spokeswoman for CCTV’s foreign affairs office couldn’t be reached for comment.

Beijing’s air-quality index started to climb last week and rose as high as 551 on Tuesday, according to an air-monitoring station at the U.S. Embassy. The U.S. Environmental Protection Agency says an index of above 300 is “extremely rare” in the U.S. and typically occurs during events such as forest fires.

Beijing authorities ordered 36 companies to stop and another 75 firms to cut production over the weekend, according to the Beijing Municipal Economic and Information Commission. An additional 36 companies voluntarily cut production, the commission said. Twenty-five inspection teams were dispatched to enforce the measures, it added.

However, local authorities have stopped short of issuing the elusive red alert for air pollution, Xinhua said. Since the pollution began climbing on Thursday, China’s National Meteorological Center has announced 12 alerts for smoggy weather, including nine yellow alerts and three orange alerts, Xinhua said.

A spokesman for Beijing’s Ministry of Environmental Protection referred questions about its colored alert system to the ministry’s official Weibo account.

Although Beijing is going through its longest stretch of bad air in recent memory,average air-quality index readings across the city were at 270 on Thursday and 255 on Sunday, making it difficult to find three consecutive days that meet the requirements for even a retroactive red alert. Still, the capital was close to doing so Wednesday, as readings climbed above 400 — making it the third consecutive day where the index was well above 300.

Beijing, however, is expected to get a reprieve. Rain began to fall in the capital late Wednesday evening, and a cold front expected to sweep across northern China should help disperse much of the smog in the country, Xinhua said Wednesday, citing the country’s meteorological center.

 

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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 (www.heroinnovator.com), 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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