Beijing Suffers Bad Air as China Prioritizes Growth

(Bloomberg) -- Beijing’s air quality was the worst in 18 months on Monday, a possible result of more flexible emissions curbs for the winter.

The economic slowdown may have been behind the decision to move away from the hard targets of last year, with the government trying to keep factories churning, according to some economists.

The concentration of PM 2.5 particles -- the most-hazardous, tiny particulate matter -- soared to 328, according to data published by the U.S. Embassy. The measure’s five-day average was 149, compared with 26 last year when the government’s environmental cleanup was in full swing.

The environment ministry said earlier this year that northern China’s industrial hub would adopt a more flexible program for its output curbs this winter, eschewing blanket cuts and taking a differentiated approach to industries including steel. Worsening trade tensions and a slumping stock market have hurt confidence in the economic outlook, putting pressure on officials to do more to shore up growth.

“The downward pressure on the economy is rising,” said Yao Shaohua, an economist at ABCI Securities Co. Ltd in Hong Kong. “Curbs on industrial production to crack down on pollution could have eased marginally compared with last year.”

Lu Ting, Nomura International Ltd.’s chief economist in Hong Kong, saw the smog coming. He predicted in a September report that Beijing would be less aggressive with its anti-smog campaign this year due to weakening demand and an escalation in trade tensions.

Residents in Beijing wore masks to protect themselves from the toxic air on Monday, though authorities signaled the air would improve by Tuesday.

“The air is so bad that everyone is literally wearing masks everywhere -- I’m even wearing on in the office, as our newly installed ventilation system doesn’t seem strong enough to offset the pollution," says Cedric Wang, an investment manager in Beijing.

To contact Bloomberg News staff for this story: Claire Che in Beijing at yche16@bloomberg.net;Yinan Zhao in Beijing at yzhao300@bloomberg.net

To contact the editors responsible for this story: Richard Frost at rfrost4@bloomberg.net, ;Jeffrey Black at jblack25@bloomberg.net, Sharon Chen

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