China's environmental protection industry will continue to maintain a relatively high growth rate during the 12th Five-Year Plan period

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A report released by the domestic research institution CCID Investment Advisors in Beijing recently predicted that the Chinese environmental protection industry will continue to maintain a relatively high growth rate during the 12th Five-Year Plan period, and it is expected that the growth rate will remain between 15% and 20%.

CCID Consulting released “China's Environmental Protection Industry Investment, Financing and Mergers and Acquisitions Strategy Study (2012)” shows that the current development of China's environmental protection industry has three major characteristics: the industry is in its infancy, high-end products are the direction of industrial upgrading, and industrial restructuring has begun. Accelerated, subdivided areas have brought new development opportunities; industrial development has spread from east to west, and regional imbalance has led to differentiated development.

The report shows that the environmental protection industry has achieved rapid development under policies and opportunities, and it has begun to be favored by private equity investors. Among them, water treatment, solid waste treatment, and environmental technology consulting are areas that investors are focusing on.

The report pointed out that environmental protection industries have a low degree of concentration and mergers and acquisitions have become an important way for industry consolidation. Not only are foreign large-scale environmental protection giants entering the domestic market through mergers and acquisitions, but domestic environmental protection companies also need to use mergers and acquisitions to develop off-site businesses.

The CCID Investment Adviser suggested that the government should encourage local governments, enterprises, and social funds to invest in environmental governance through market-based methods, including incentives for pricing, fiscal and taxation, credit, government procurement, and improving environmental protection standards. This will promote the all-round development of the environmental protection industry.

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