# _(c) Experiments to overcome capacity constraints_

As discussed previously in Section 3, local governments work under certain political, technical, and financial capacity constraints that influence environmental policy outcomes. One of the political constraints covered in the discussion is the “central SOE problem”, which refers to the fact that local governments can do very little to prevent central SOEs ( _yangqi)_ from polluting their localities. Recently, the local EPB in Anqing municipality in Anhui charged the central state-owned enterprise Sinopec with a 90,000 RMB fine for a local pollution accident. This was one of the first instances in China and could set a precedent for other local EPBs looking to exert stronger supervision of central SOEs (CNR Financial Review, 2013; _Box 12_ ).

## **Box 12: Addressing the “Central SOE problem”**

In June 2013, the local EPB of Anqing Municipality in Anhui charged the central SOE Sinopec Anqing with a 90,000 RMB fine for polluting the local air. This was triggered by a production accident that occurred in May 2013, whereby black smoke was leaked from Sinopec’s production facilities, polluting the local air. This event was one of the first of its kind, as usually local EPBs have no authority to charge pollution fees to central SOEs. Often managers of local branches of central SOEs also hold concurrent posts within the locality; the general manager of Sinopec Anqing, for instance, is concurrently also a member of the Anqing Municipal Standing Committee, a powerful position in the locality. The Anqing case is the first precedent of this kind and could be a signal to other local EPBs to be more bold in addressing the “ _yangqi_ problem”. However, the fine of 90,000 RMB is relatively low for a central SOE and does not fully reflect the considerable local ecological and health damage resulting from Sinopec’s pollution.

Two factors help to explain why the municipal EPB in Anqing dared to fine the central SOE in their locality:

- a) _Public monitoring_ was certainly an important stimulus: following the accident in May 2013, a lot of citizens in Anqing complained about the pollution and posted pictures to the Internet.

- b) _Strong EPB leadership:_ In early 2013, Anqing Municipality assigned a high-ranked local leader – a former vice mayor – to be the leader of the municipal EPB. The newly appointed leader frequently visited the provincial EPB bureau and the national Ministry of Environmental Protection to gain upper level government support. A highly-ranked local leader as an EPB head together with the support from national level made charging the new fee possible.

_Source: CNR Financial Review (_ 央广财经评论 _), 2013; Banyuetan Network, 2013_

# _(d) Experiments to increase public and private participation_

Over the last decade, we have witnessed the flourishing of a variety of participatory experiments in the field of local environmental politics. The newly emerging institutional arrangements that allow for further participation in China’s environmental policy-making, such as increased environmental NGO activism, public hearings, and improved information disclosure, also contribute to enhance local environmental policy implementation, and sometimes even policy-making (Kostka and Mol, 2013).

Local governments have experimented with new methods to reach out to the public. For example, in 2013, the Chengdu EPB appointed six full-time staff to set up a microblog for citizen outreach. The microblog aims to act as a platform for citizens to interact with the local government in which they can hold discussions as well as distribute information to the public about environmental problems. Furthermore, the blog also offers functions to undertake surveys and register citizen complaints (China Daily, 2013e).

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