The dilemma of electronic waste dismantling: profit by subsidy "impulse" difficult to continue

"Environmental pollution is the livelihood of people suffering from the pain of the public, to be an iron fist." This statement, which appears in the Government's work report this year, shows the importance of environmental protection in the work of the Government in the 2015.

On the eve of this year's two sessions, the China Democratic Foundation submitted a proposal on promoting and standardizing the disposal of electronic waste in China (hereinafter referred to as the "proposal"), aiming at the current electronic waste dismantling and chaos, and its proposal focused on supporting the construction and technical renovation of large professional electronic waste disposal enterprises.

Recently, the "Daily economic news" from a number of industry insiders learned that the electronic waste dismantling industry's gross profit margin of less than 10%, and some enterprises in the supply of competition to take a vicious approach.

Producers pay for environmental costs

"The treatment fund is by far the most effective and well-managed one," said Aijun, Deputy Secretary-General of China's Renewable Resources Recycling Association. This policy from design to operation are relatively smooth, in its drive, for the enterprise is undoubtedly a long-term positive mechanism. ”

The so-called Treatment fund policy refers to the formal implementation of the "waste electrical and electronic products Management regulations" in 2011, its use of producer extension responsibility system, the State to the production enterprises to collect waste electrical and electronic products processing costs, the establishment of funds to subsidize the formal recycling enterprises.

Among them, the producer extension responsibility system refers to the environmental responsibility that the producer undertakes not only in the production process but also in the whole product life cycle, especially after the waste recovery and disposal responsibility.

In this respect, Grammy (002340,SZ) Chairman Xu Kaihua told the "Daily Economic news" reporter, "in the economic operation to change a way of thinking, production costs is not to say just manufacturing costs, but also must pay the cost of environmental governance, pay these two costs, to calculate profits." Such enterprises are truly core competitiveness. ”

Subsequently, in 2012, the implementation of the "waste electrical and Electronic Products processing Fund collection and use of management measures", clearly defined the treatment of the fund levy and subsidy standards. Among them, the subsidy standard is the television 85 yuan/Taiwan, the refrigerator 80 yuan/Taiwan, the washing machine 35 yuan/Taiwan, the room air conditioner 35 yuan/Taiwan, the microcomputer 85 yuan/Taiwan.

Aijun said, "The previous policy is more to subsidize the investors, now is the subsidy to do the actual business, complete the dismantling of electrical and electronic products waste, but also to comply with stringent environmental audits." Only after the national, provincial, urban-level three-level audit can get subsidies. "This policy has also played a key to curbing the blind investment in the environmental field and the project on projects."

It is understood that as of February 2015, China has 106 enterprises into the waste electrical and electronic products processing fund subsidies enterprises list, covering almost all provinces and municipalities. According to the Ministry of Finance 2014 Central Government fund income and expenditure budget, 2013 waste electrical and Electronic products Processing fund income of 2.811 billion yuan, the fund expenditure of 753 million yuan, of which, direct subsidy processing enterprises 629 million yuan.

Some companies are accused of vicious competition

The proposal of China Democratic Foundation shows that the current electronic waste recycling and processing industry in China is still in an extensive state. As of 2015, access to environmental protection sector technology certification enterprises have reached 106, however, due to the early construction of high investment, high processing costs, the face of electronic waste recycling channels and the scarcity of the plight, resulting in some enterprises can not start production, in the embarrassing situation of loss. Analysis of the proposal, this situation is mainly because of China's electronic waste recycling system design, lack of scientific recovery system, resulting in the grey recovery processing chain flourish.

In addition, the China Household Appliances Research Institute released the "China Waste Electrical and electronic products recycling and comprehensive utilization industry White Paper (2013)" (hereinafter referred to as "white paper") shows that, in recent years, the rapid increase in the number of enterprises to promote the industry's steady and balanced development, at the same time the electronic dismantling of enterprises in the supply of competition is increasingly fierce. "Last year in the industry there have been some enterprises in order to scramble for supply and raise prices, with vicious bidding method to obtain supply." Aijun that, to the enterprise itself, blind "impulse" is not a good development state.

The reason why the enterprise blindly "impulse" is that most of the enterprise's fixed assets investment has basically stabilized, "the enterprise may want to reduce the fixed cost by ' impulse ', while the variable cost is related to the quantity, and the amount is used to offset the expenditure of fixed cost."

In Aijun's view, "impulse" is not a sustainable way. Enterprises should pay more attention to strengthen the "internal strength" cultivation, improve the profitability of a single processing equipment, through the resource or recycling channels, seize the more effective way to play. "Of course, the vicious bidding of recycling channels needs more or industry self-discipline." ”

Corporate profits depend mainly on subsidies

In addition to recycling sources of competition, homogenization is another major problem faced by enterprises.

Aijun said that at present, enterprises in the primary dismantling equipment, technology, personnel management has been relatively perfect, but there is more of a problem is the trend of enterprise homogenization is very clear, the main profit depends on the treatment of the Fund subsidy. In the market-oriented premise, this situation will lead to the enterprise's own innovative ability, the corresponding profitability, operational capacity will be weaker.

Xu Kaihua to reporters that the waste electrical and electronic products processing industry average gross profit margin of less than 10%. Aijun also admits that the fund subsidy has become the main profit point of the enterprise. "This aspect is the future enterprise should consider a problem, after all, the fund policy is this time period country to this industry an incentive and the support, in the future must also survive under the market environment." "Aijun said.

In addition, Xu Kaihua that the relevant laws and regulations also have a certain lag, "over the past more than 10 years, China's electronic waste in a state of explosive growth." "In February this year, the National Development and Reform Commission and other departments of the Ministry of Environmental Protection issued a new version of the Waste electrical and Electronic Products Processing Directory (2014 edition), electronic waste from the original" Four Machine Brain "extended to the water heaters, printers, telephones and other 14 categories. Xu Kaihua that the expansion of producer responsibility system is another major legal progress in China's electronic waste processing industry.

However, Xu Kaihua also said that the use of our country's lamp is very large, but the new version of the catalogue does not include the 2014 issue of the draft of the request for comments on the waste batteries and waste fluorescent tubes. "The tube contains a lot of mercury, which is deadly to the environment," he said. According to incomplete statistics, in recent years, China's large and medium-sized cities and towns each year used lamp data is 700 million fluorescent tubes, energy-saving lamp 1.2 billion, high-pressure sodium lamp and metal halide lamps 15 million. Such contaminants should be quickly incorporated into the producer pay extension accountability system. "Xu Kaihua said.