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CCICED: Consumption vouchers should stimulate green consumption

2020-05-12author:source:Translated by?CCICED

The China Council for International Cooperation on Environment and Development (CCICED) launched the Special Policy Study (SPS) Green Transition and Sustainable Social Governance in 2018. The SPS has completed the first phase of its policy study and submitted the policy recommendations to the Chinese government.  


Introduction of the First Phase of the Study


The second phase of the SPS is now underway and it focuses on the following items: study the national strategy of sustainable consumption, combining sustainable production and consumption patterns with high-quality development; put forward the goals, tasks and main approaches of green consumption during the 14th Five-Year Plan period; establish the index system and evaluation methods of green consumption; decode how sustainable consumption contributes to green economic transformation via quantitative analysis; analyze how government procurement promotes green goods and services; conduct case studies of policies, such as consumption and production in the automobile industry, green electricity market reform, green construction, green logistics (e-commerce), digital low-carbon lifestyles and environmentally-friendly waste incineration.


As the COVID-19 epidemic wanes in China, expanding consumer spending has become an urgent need for economic recovery and social development. Many local governments and e-commerce businesses have started to offer vouchers via digital platforms to boost consumption. 


Against this backdrop, the CCICED Special Policy Studies on Green Transition and Sustainable Social Governance recently proposed that the vouchers' design could integrate some "green" elements, so as to revive the economy while promoting green, low-carbon and sustainable development.


Accordingly, governments can formulate general standards to identify green consumer behaviors and businesses, and further expand the functions of the digital platforms, in order to support "green consumption vouchers" with a coordinated set of measures. The goal is to create new hotspots of online green consumption and promote comprehensive and sustainable economic development after the epidemic. 


"For example, we would provide more preferential support for those buying products or spending at businesses certified as 'green'," said Zhang Jianyu, deputy team leader of the CCICED SPS on Green Transition and Sustainable Social Governance. "In addition, we can reward the citizens who behave in a green and low-carbon way (such as garbage sorting and green travel) with 'green credits' or 'carbon credits', which could be used to exchange for more vouchers."


In an interview on May 9, Zhang said that green consumption vouchers refer to coupons which take into consideration environmental protection and low-carbon approaches. Compared with ordinary vouchers, green ones can raise consumers' awareness of green, low-carbon and sustainable economic development, and provide more incentives to those businesses embracing green and low-carbon goods and services while stimulating consumption and overall economic recovery.  


Green consumption vouchers: Is now the time?


Affected by the COVID-19 epidemic, China needs to revitalize the economy. Is the time ripe for implementing the proposal of green consumption vouchers?


In the interview, Zhang pointed out that consumption has become the main driver of China's economic growth. To some extent, the epidemic has triggered a public reflection on the relationship between humanity and nature, as well as the issue of sustainable development. It has also made more people ponder the route to high-quality and sustainable economic development while also considering how to stimulate economic recovery. Therefore, it is the right time to promote green consumption vouchers and the concept of green and low-carbon lives.  


According to Zhang, at present various forms of "carbon benefits" projects have been carried out in some carbon trading pilot areas, with "carbon credits" as the main reward. By identifying and counting the emissions reduced through their daily green and low-carbon behavior, participants will be rewarded with corresponding credits. 


Zhang said such projects are of great significance in enhancing public awareness of green consumption and climate change. It is a useful reference and has laid a good foundation for systematically promoting green consumption on digital platforms in the future.


However, in the process of launching consumer vouchers, major e-commerce platforms have not separately designed the corresponding functionality or advertised them with the concept of "green consumption". 


"Nowadays, consumption vouchers are basically released on digital platforms (such as Alipay and WeChat) around China. According to incomplete statistics, the users of Alipay and WeChat Pay number more than 1 billion, which forms a digital network of wide coverage and multi-functionality," said Zhang. He hopes that the distribution of green consumption vouchers could engage these existing platforms in incorporating green and low-carbon elements into their existing business modules. For example, establish a "green business alliance" relying on the platforms, set up multi-functional systems to certificate "green products" and personal "green consumption", and guide public consumption behavior towards sustainability.


Releasing consumption vouchers should incorporate "green" elements


In 2018, CCICED launched a task force on Innovation and Sustainable Production and Consumption. In accordance with the overall research plan, the task force conducted a Special Policy Study (SPS) on "Green Transition and Sustainable Social Governance" in 2018-2019. The task force found that since the beginning of March, Zhejiang, Jiangsu, Guangdong, Beijing, and Hubei have successively begun to bolster residents' consumption by issuing "consumption vouchers" on various digital platforms, including Alipay and WeChat, which has an obvious "multiplier effect" on stimulating economic recovery.


After analyzing the local policies, the study found that the current consumption vouchers are of great variety and have different characteristics, and the multiple rounds of "consumption vouchers" have accelerated local economy recovery to a certain extent. However, neither the concept of sustainable development nor consideration of long-term effects – social or environmental —  have been put into the policy design of local vouchers. But in fact, in the process of boosting consumption and resuscitating the economy, the concept of "green consumption" has long been written in the official documents.


In March 2020, the National Development and Reform Commission and 22 other ministries jointly issued a document about promoting consumption expansion and quality improvements to form a strong domestic market, which proposed to "encourage green smart products, promote green consumption that focuses on the supply of green products, the construction of green public transport facilities, environmentally-friendly buildings and related technological innovations, and create green shopping malls".


To this end, the research team proposes that governments at all levels should set the evaluation criteria for "green businesses" for different industries, in the light of regional economic development, and set up an alliance of green businesses on digital platforms to publicize epidemic prevention and green consumption measures, so that consumers can be inspired and informed by the open and transparent information available.


For businesses in the alliance, the research team suggests that green consumption vouchers can be distributed separately or "packaged" with others. They propose greater support for green consumption vouchers in terms of reductions, discounts, service and quantity, so as to guide the public to consume green products and to shop in green businesses.


To encourage the public's green and low-carbon consumption behavior, the research team suggests that governments should identify and record consumers' consumption by green vouchers and other low-carbon behaviors in daily life. Then they should reward greener consumers with carbon credits and privileges which they can exchange for more vouchers or other rights.


Furthermore, green consumption vouchers and supporting preferential measures can be combined to support small and medium-sized businesses to gradually achieve green transformation and sustainable development. For example, in addition to consumption vouchers, Wuhan in Hubei province also offered loans with a 30 percent discount to small and micro-sized businesses, to help the city's service sector bounce back. The research team believes that this measure is valuable and it proposes more preferential services to qualified green small and medium-sized enterprises in financing and taxation, in order to promote economic recovery in a green way. 


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