PCR Working Group Meeting (Shanghai) Go back »
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Time2009-02-17 | 14:30
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Venue:European Chamber in Shanghai
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Address:Unit2204, Shui On Plaza, 333 Huai Hai Zhong Road, Shanghai
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Fee:Members: FREE |
Non Members: FREE
Petrochemicals, Chemicals and Refining
Working Group Meeting
Time: Tuesday, 17th Feb, 2009
Venue: European Chamber Office, Unit 2204, Shui On Plaza, No. 333 Huai Hai Middle Road, Shanghai
Agenda:
1. Presentation by Reggie Lai (the senior associate director, public affairs and corporate advisory at APCO Worldwide) on: energy stakeholders, the role of NDRC in a post restructuring era, regulatory challenges for companies in the energy industry and implications for FIEs.
2. NDRC Forum update, to include details on
a) European side speakers,
b) agenda,
c) dates and venue; and
d) Chinese side participants.
3. Drafting of audit protocol for cooperation with Ma Jun.
4. Update on Working Group action plan, contact with NDRC, MIIT and MEP, local lobby action plan.
5. Discussion of possible issues for inclusion in this year’s Position Paper. Key dates for drafting of Position Paper.
6. WTO implementation study.
7. AOB a) Next meeting dates, plus timetable for election of new Chair and Vice Chair for 2009.
Event review
Petrochemicals, Chemicals and Refining
Working Group Meeting
Time: Tuesday, 17th Feb, 2009
Venue: European Chamber Office, Unit 2204, Shui On Plaza, No. 333 Huai Hai Middle Road, Shanghai
Company | Name | EUCCC Member |
Total Petrochemicals | Guillaume Lesage | X |
Total Petrochemicals | Charles Lagrange | X |
Sasol Chemicals | Guy Bessant | X |
APCO Worldwide | Alastair Campbell | X |
APCO Worldwide | Reggie Lai | X |
APCO Worldwide | Berenice Voets | X |
Air Liquide | Christian Guerithault | X |
DSM China | Helen Wang | X |
BASF | Bing Fei-Felix Hu | X |
Akzo Nobel | Jorn Seiero | X |
APCO Worldwide | Reggie Lai | X |
Evonik Degussa | Wenlan Shen | X |
BP | Gloria Zhou | X |
Lanxess Chemical | Felix Ding | X |
Bayer Material Science | Matthias Hoehne | X |
Bayer Material Science | Bin Yang | X |
Merck | Richard Zhang | X |
Merck | Karin Xu | X |
EUCCC | Tony Brooks | |
EUCCC | Lukas Holec |
Agenda:
1. Presentation by Reggie Lai (the senior associate director, public affairs and corporate advisory at APCO Worldwide) on: energy stakeholders, the role of NDRC in a post restructuring era, regulatory challenges for companies in the energy industry and implications for FIEs.
2. NDRC Forum update, to include details on
a) European side speakers,
b) agenda,
c) dates and venue; and
d) Chinese side participants.
3. Drafting of audit protocol for cooperation with Ma Jun.
4. Update on Working Group action plan, contact with NDRC, MIIT and MEP, local lobby action plan.
5. Discussion of possible issues for inclusion in this year’s Position Paper. Key dates for drafting of Position Paper.
6. WTO implementation study.
7. AOB a) Next meeting dates, plus timetable for election of new Chair and Vice Chair for 2009.
Minutes:
1. Presentation by Reggie Lai (the senior associate director, public affairs and corporate advisory at APCO Worldwide) on: energy stakeholders, the role of the National Development and Reform Commission (NDRC) in a post restructuring era, regulatory challenges for companies in the energy industry and implications for Foreign Invested Enterprises (FIEs).
Reggie Lai gave a presentation on energy stakeholders, the role of NDRC in a post restructuring era, regulatory challenges for companies in the energy industry and implications for FIEs. (APCO Worldwide are not able to release the PPT to Working Group members. Any WG member wishing for more information on the presentation, should contact APCO through the Business Manager).
Essentially, before the ministry reorganisation in March 2008, there was a spider’s web of overlapping and even competing responsibilities for energy issues at central government level in China. Competing stakeholders included the energy bureau, specialist ministries and NDRC. At the centre of this “web” was the State energy Leading Small Group (LSG) reporting directly to the State Council.
Now NDRC is a “super-ministry” with very real “power” on energy issues over other ministries such as the ministry of Commerce (MOFCOM) and the ministry of Industry and Information Technology (MIIT). So NDRC sits at a level below the State Council (the highest executive body), the National People’s Congress (NPC) (the highest legislative body) and the Chinese communist Party (CPC). In responsibility terms, NDRC now sits above other ministries, who in turn sit above the National Energy Administration (NEA). The NEA has day-to-day responsibility for the administration of State Owned Enterprises (SOEs) in the Petrochemicals, Chemicals and Refining (PCR) field.
Further down the chain in terms of responsibility for energy issues are the following:
Industry Associations – these are quasi government agencies.
Think Tanks (e.g. the Energy Research Institute) – such organisations are advocates of certain policies, rather than pure research organisations.
Independent Research Institutes; and
Other Stakeholders (e.g. the State Grid, EU China High Level Working Group on Energy).
It is worth cooperating with such organisations, as they often advise government. Industry Associations are sometimes headed by retired senior cadres. Furthermore, it is becoming increasingly difficult to access ministries, so it is often better to look for “soft channels” for putting information across, such as think tanks and academics. Another possible channel is government-to-government, but this is generally only reserved for the most serious and important topics.
NDRC has lost some functions to MIIT, however, it has gained the ability to coordinate between ministries on energy supply etc. NDRC does not generally involve itself with macro-economic issues, more micro-economic ones. The new MIIT super-ministry does not regulate energy affairs directly, rather it is directed to regulate energy related areas such as wind power.
Areas of legislative interest to PCR companies over the next year include: the formulation of the 12th Five Year Plan (5YP); the draft energy law (note that the law has not been included in the NPC’s legislative agenda plan for 2008-2012). The Circular Economy Promotion Law became effective on January 1st, 2009. There will possibly be energy price reform in 2009 as well.
The presentation concluded with analysis of how the set up of the NEA improves administrative process, as well as long-term government goals and priorities for the energy industry. It is worth highlighting that the central government is now starting to focus more on macro-economic problems while delegating implementing authority to the regions. Regional governments meanwhile are reorganising themselves to align with central government.
There then followed a short presentation on the Stimulus Package, and how it is affecting PCR companies, given by Alastair Campbell, the Vice Chairman of APCO Worldwide. The details of the stimulus package are attached to these minutes. However, of interest to PCR companies is the 500 billion RMB that is being directly allocated to support the Chinese petrochemical and chemical industry, mainly to offset falling demand. Some of the money is being allocated to increase industry efficiency and other indirect goals, such as building oil reserves. Thus, an estimated 100 billion RMB will be allocated to upgrade Chinese refining capacity, with the other 400 billion being reserved for an estimated 20 large scale PCR projects. Consultations on detailed spending plans are taking place throughout February 2009, with a detailed implementation plan expected by mid 2009. Two PPTs on the Stimulus package are attached to these minutes: attachment 1, attachment 2.
Action
All members are requested to advise the Business Manager on who should be the most appropriate think tank to approach in order to present our Position Paper and pass on some messages.
2.NDRC Forum update, to include details on
a) European side speakers,
b) agenda,
c) dates and venue; and
d) Chinese side participants.
The PCR WG contact at NDRC, Mrs Li Ningning, the Deputy Director General at the Industrial Department, is now back at her desk, after a prolonged absence on sick-leave. She definitely expressed her wish for the NDRC forum to take place around April and will speak to the Working Group again in March 2009. For the moment, however, Mrs Li is exceptionally busy with coordinating the stimulus package, and therefore has no time to think about the NDRC forum .
Mrs Li has asked the Working Group to refocus the core theme of the NDRC forum, from energy saving more towards PCR issues. The agenda has been slightly modified and now focuses more on operational efficiency. The working Group has proposed the 7th April as a possible date for the forum to be held, but this will have to be confirmed at a later date as this is in the middle of European Easter holidays. The specified consultancy for the NDRC, that is the CIECC (中国国际工程谘询公司), is currently working on a plan to identify speakers. However, CIECC will take no action to invite the identified speakers to attend the NDRC forum until NDRC fixes the date for the event.
Action:
All working Group members who have volunteered speakers are requested to keep 7th April free. Members should be forewarned that the dates for the NDRC forum are not likely to be finalised until shortly before the event.
3. Drafting of audit protocol for cooperation with Ma Jun.
This item was not discussed in detail, since the meeting overran time-wise and there was no new news to report. In particular, since the January 2009 WG meeting, no further PCR member companies had submitted a response to the “Cooperation with the Institute of Environmental and Public Affairs (IPEA)” (Ma Jun) survey. Thus, to date, only five out of a total of twenty five members have submitted comments on the suppliers questionnaire sent out to members.
Action:
The WG chair has requested that the Business Manager provide an update on cooperation with the IPEA and Ma Jun.
4. Update on Working Group action plan, contact with NDRC, MIIT and MEP, local lobby action plan.
A courtesy meeting has been set up between the EUCCC President and one of the vice ministers of MIIT, with responsibility for IT issues. However, MIIT felt that it would be inappropriate for the EUCCC President to further meet with the vice minister with responsibility for PCR issues, so it is intended that a meeting will be set up at Director General (DG) level. Charles Lagrange will meet with the Environment Working Group in Shanghai at the beginning of March, to discuss both cooperation with Ma Jun, and also joint cooperation with MEP. The Environment WG wishes that both they and the PCR Working Group cooperate jointly in their approaches to MEP.
Action:
- The Business Manager is to coordinate with the EUCCC government affairs manager in Beijing, to obtain updates on the proposed DG level meeting with the DG responsible for PCR issues at MIIT.
- Charles Lagrange will meet with the Environment WG at the EUCCC, to coordinate the meetings with MEP.
- The Business Manager is to draw up a list of responsibilities within MIIT.
- The Business Manager is also to send the formal meeting request to the CRC.
- The Business Manager is to liaise with the Chair/Vice Chairs and Shanghai WG members, to arrange on dates available and persons to attend the meeting with Shanghai SFDA to discuss key recommendations 3b and 3d on the position paper.
5. Discussion of possible issues for inclusion in this year’s Position Paper. Key dates for drafting of Position Paper.
For more details on the PCR Action Plan for 2009, please see the attached PDF file. The file contains details of current issues, as set out in the 2008/2009 Position Paper. As well as the progress made to date on resolving them, and at which levels the issues are directed, e.g. local, national, or EU level.
The key dates for this year’s Position Paper submission are 30th March – Submission of Key Recommendations; 30th April – Submission of first draft of Position Paper; 30th May – Final draft of Position Paper; 19th June – Final date for submission of Business Manager and WG Chair approved English version.
Action:
- Members are requested to consult within their companies, to see which issues they would wish to see included or added to the 2009/2010 Position Paper and report to the Business Manager prior to the next PCR meeting.
- Charles Lagrange will send, with a reminder, a status summary of all position paper recommendations 2 weeks prior to the next PCR meeting.
6. WTO implementation study.
Details of the study conducted by the WTO on the effectiveness of Chinese implementation of the WTO protocol are attached to these minutes. PCR member companies who wish to submit comments to the WTO study are requested to contact the WTO directly (details are contained in the attachment).
Action:
Companies that wish to submit comments to the WTO on the WTO implementation study are requested to submit them by 27th February 2009.
7. AOB a) Next meeting dates, plus timetable for election of new Chair and Vice Chair for 2009.
Ted Xiong has announced that he will be standing down as vice Chair at the next election, which will take place during the next WG meeting in Beijing on March 17th, 2009.
Guillaume Lesage announced his intention to stand as WG Chair for a further third year.
Richard Zhang has not yet announced whether he intends to stand. Details of the role of the WG Chair and vice Chair are attached to these minutes.
The current Chair and Vice Chairs encourage anyone interested in standing for any of these positions to contact them or Tony Brooks directly, for more details on the roles and the work involved.
The next PCR Working Group meeting will take place in Beijing (venue tbc) on Tuesday 17th March, 2009.
Full text of this minutes, please click here.
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