[ccebook.cn]The World in 2010

South Korea has made green technology a cornerstone of national policy. The budget, about $60 billion to be
spent by 2012, is smaller than China’s but represents a whopping four-fifths of South Korea’s total stimulus
package. In 2010 tax incentives, subsidies, credit guarantees and spending programmes will begin to be
showered on everything from hybrid cars to fitting buildings with energy-efficient LED lighting.
The country plans to spend around 2% of its GDP on green tech through to 2013, to reduce emissions and
spur a new export industry. Sandwiched between China (with lower costs) and Japan (with superior
technology), Korean manufacturers have much catching up to do in green-tech products. Bureaucrats hope to
increase South Korea’s global market share in these technologies from 2% to 8% by 2013.
Japan has long been a green-tech pioneer. It has set aside $35 billion of its stimulus, about 6%, for green
tech, in areas such as subsidies for residential solar projects. Its green stimulus is smaller than its neighbours’
as it already pours in funds from the regular budget: $22 billion for the environment and conservation in
2009, of which $7 billion was for clean energy including nuclear power. The new government has set ambitious
targets for reducing carbon emissions. It also promises new spending in 2010 for low-emission cars and
energy-efficient appliances.
Other Asian countries have green ambitions. Singapore has a war chest of $450m and in 2010 it will build a
55-hectare (135-acre) clean-tech office park and fund a solar-power research institute. Taiwan plans to spend
$1 billion over five years developing solar, LED-lighting and renewable-energy technologies.
Any colour you want so long as it’s...
What exactly counts as green technology? The figures include water and waste projects that are green, but
not energy-related. Almost $100 billion of China’s stimulus is for energy-efficient rail transport—which may
reduce emissions, but is ultimately just a train system.
Still, the focus on green tech is a natural evolution for Asia’s IT industries. LCD screens and semiconductor
chips share the same materials and manufacturing processes as solar photo-voltaic cells; many factories have
simply been converted from one to the other. The battery technology for electric cars applies the intellectual
property that was developed for electronic gadgets.
Whether the bureaucrats can channel the public largesse efficiently is an open question. Since the immediate
purpose is to pump-prime the economy, the emphasis will be on dispensing the money rather than on the
return on investment.
Kenneth Cukier: Tokyo correspondent, The Economist
Copyright © 2009 The Economist Newspaper and The Economist Group. All rights reserved.
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