Anti-pollution rule costly for fabric maker
Pacific Textiles Holdings is fighting an uphill battle against a tough mainland environmental rule that allows factories to expand production capacity only if it does not increase pollutants.
The company, one of the largest textile makers in the Pearl River delta, had earmarked a significant portion of its about HK$400 million in investment next year to reduce pollution levels at its Panyu production base in Guangzhou, where it planned to raise capacity by 10 per cent, said chairman Wan Wai-loi.
The investment in recycling, treating sewage and reusing waste water and sludge was necessary for the sake of the next generation and the sustainability of the normally pollution-intensive industry, he said.
'The rule forces us to use less water and energy while we make more fabric,' he said. 'It is very difficult to make it. However, if we want to stay in the market, we have no choice but to follow the rule.'
Located next to the Hongqi River and surrounded by vegetable and banana farms, the factory had 'gone green' since it started operating 12 years ago, Wan said.
'We don't want to see the sewage flow to our homes in Hong Kong,' he said. 'Clean production is a reality, as you can see from the heated debate on climate change in Copenhagen.'
Pacific Textiles, which supplies fabric to apparel retailers such as Uniqlo of Japan, Nike and Calvin Klein, has spent almost HK$300 million in the past three years on the factory to treat sewage and exhaust before discharge, reuse waste water for flushing toilets and desulphurise its power station.
The factory is also fitted with about 50,000 energy-saving fluorescent lights and reuses heat and steam to power its air-conditioning system to save fuel, all of which saves 2.1 million units of electricity annually.
The firm is also stepping up automation to reduce its workforce, which stands at about 6,800.
Wan said it had reduced emissions by about 81,000 tonnes of carbon over the past three years.
Although some environmental measures were costly, and investments could take years to be recovered, Wan said the company was beefing up clean production technology such as digital printing of fabric.
The average selling price of fabric rose 1.3 per cent to HK$30.30 per pound in the six months to September, compared with an industry average of HK$20, said chief executive Lam Wing-tak.
Pressure to make manufacturing environment-friendly is rising. The United States Congress is considering a bill to impose taxes on imports from countries that do not do enough to curb pollution. The World Bank forecast it would deliver a heavy blow to China's manufacturing sector.
The mainland's environmental rule has been in place for several years. But enforcement was toughened recently on polluting industries in the municipality after the global financial crisis stabilised, some factory owners said.
They said tougher environmental requirements had been one of the factors forcing small and medium-sized factories out of business in the Pearl River delta in recent years.