The draft law on recycling economy of China, made to boost sustainable development through energy saving and reduction of pollutant discharge, was deliberated for the first time by lawmakers on Sunday.

The draft law was submitted to the 29th session of the Standing Committee of the National People's Congress (NPC), China's top legislature, for first reading.

The draft stipulates governments at all levels should make plans on the development of circular economy, establish systems to control energy use and pollutant emission, strengthen management on companies with high energy and water consumption, make policies to divert capitals into environmentally friendly industries.

The draft also introduces reward and punishment systems for companies, encouraging them to develop recycling economy and making them responsible for the recycling of their products.

Officials found with dereliction of duty will get administrative punishments or even be subject to criminal prosecutions, the draft says.

Companies which violate the import ban on equipment, materials or products that cause high energy consumption and pollution will be fined from 100,000 yuan (US$ 13,333) to 1 million yuan, according to the draft.

It says companies which use fuel generators or fuel boilers that fail to meet national standards will be fined from 10,000 yuan to 500,000 yuan.

"China has been facing serious environmental and resources problems during the economic development since the 1980s, which were mainly caused by the low resources efficiency", said Feng Zhijun, vice chairman of the NPC Environmental Protection and Resources Conservation Committee, at the legislative session.

He said the average energy consumption per unit product for high-energy-consuming industries, such as steel, electric power and cement in China was 20 percent higher than the advanced international level.

Feng said the development of recycling economy would provide new resources for economic development, effectively cut pollutant emissions and increase economic benefit.

If a steel factory, with a yearly output of eight to 10 million tons, reclaims all of the remaining heat and flammable gas, the energy saved is able to run a 800,000-kilowatt power station, and if China's energy efficiency reaches advanced international level, it will reduce the emission of sulfur dioxide by 4.5 million tons every year, he said.

"It's essential to establish a legal system to combine energy saving and environmental protection with economic and social development to ensure a sustainable development," he said.

The committee started to draft out the law on recycling economy in December, 2005 and collected more than 1,000 suggestions from relevant government departments, colleges, and local people's congresses this year to perfect the draft.

(Xinhua News Agency August 27 2007)