HOTLINE: Will Shanghai smog choke overseas investment?

Last week, Hotline learned that China’s central bank intended to make cross-border capital flow via the newly-established Shanghai Free Trade Zone easier, in a bid to attract more investment from overseas and multinational companies.

Nothing wrong with wanting to secure a bit of extra cash from friends abroad, of course.

But given the recent condition of the city’s air supply, Hotline suggests that that perhaps they should throw some free breathing apparatus into the bargain too.

As of 13:00 local time on Friday December 6, the index for airborne particulate matter under 2.5 microns in diameter (PM 2.5) reached 468 micrograms per cubic metre in Shanghai, according to the official index by the city’s environmental monitoring center.

Though this was far above the previous record of 300, Hotline has discovered an unofficial index that placed pollution levels as high as 510 micrograms per cubic metre – an air quality state deemed as “hazardous”.

And while this was below neighbouring stainless steelmaking hub Wuxi’s positively eye-watering level of 573 micrograms per cubic metre, it’s still more than 20 times the recommended World Health Organisation (WHO) guidelines. PM 2.5 poses the biggest risk to health, according to the WHO, as the particles are small enough to penetrate deep into the lungs.

Yesterday, unofficial PM 2.5 levels in Shanghai were already high enough at 288 micrograms per cubic metre to warrant an alert level of “very unhealthy” and disrupt steel trade on the east coast, as several highways closed in Shanghai due to low visibility.

This isn’t the first time China has struggled for breath. Back in January, Beijing stole headlines as residents were told to stay indoors when PM 2.5 readings soared to over 900 micrograms per cubic metre.

However, the timing of the latest stifling haze is pertinent. In September, the country’s state council pledged to reduce PM 2.5 density by 20% by 2017. Yet just last weekend, local media reported participants in Shanghai’s yearly international marathon wearing facemasks for the first time.

This weekend, though, it looks like outdoor activity of any sort is strictly off the cards for Shanghai’s 23 million residents.

editorial@metalbulletinasia.com