The high leverage of environmental protection companies has led to the risk of capital chain, coupled with factors such as difficulty in financing and high financing, which has made private environmental protection enterprises bear more and more pressure to survive. Some even shouted the slogan “Winter is coming”. However, from the statistics of national statistics, the development of the environmental protection industry as a whole has not slowed down due to financial problems.

Since the beginning of 2018, China's private enterprise bond default incidents have appeared frequently, and many environmental protection enterprises can not escape the "bad luck." According to an environmental company executive, in the past, money came too easily. Banks chased money, set up, issued bonds, and other channels could come, which led to some blind investment.

In the past few years, environmental protection companies have been vying for PPP projects, relying heavily on financing. When the company’s own funds are insufficient, it is often the removal of the East Wall to fill the Western Wall. This year, the PPP policy suddenly tightened, and the debt-raising projects were frozen or prematurely terminated. The company suddenly fell into trouble and even the capital chain broke.

"For a long time, many environmentally-friendly enterprises have expanded their scale and a large number of environmental protection projects have been built, which has made it difficult for enterprises to get out of debt," said Li Xiaoping, executive deputy director and director of the Chemical Industry Committee of China Industrial Environmental Protection Association.

The high leverage of environmental protection companies has led to the risk of capital chain, coupled with factors such as difficulty in financing and high financing, which has made private environmental protection enterprises bear more and more pressure to survive. Some even shouted the slogan “Winter is coming”.

A few happy families. Some voices believe that the strengthening of the country's deleveraging has led to financial problems for enterprises. Some professionals have pointed out that the issue of debt default of environmental protection enterprises has nothing to do with the system. The problems mainly lie in the operation and management of enterprises and strategic thinking. That is to say, on the surface, it seems that the failure of an investment is essentially caused by a series of human factors such as disregard of rules and blind expansion.

It can be said that at present, China's environmental protection enterprises are faced with the heavy responsibility of winning the battle against pollution, and also face the dilemma of repeated cold in the capital market; facing the favorable development opportunities brought by the “Belt and Road” and facing PPP. Confusion caused by the adjustment process of the project; facing the favorable opportunity of the high environmental protection enthusiasm of the whole society, but also facing the dilemma of the industry's national advancement and retreat.

Regarding environmental protection and financial issues, Zhao Wei, chairman of the Environmental Chamber of Commerce of the All-China Federation of Industry and Commerce and chairman of Botian Environmental Group, said that the domestic economy has begun to strengthen the de-leverage, and the attitude of the capital market to environmental protection has also been turned from cold to cold, and PPP projects are undergoing in-depth adjustments. There is a trend in the industry to retreat from the country. The superposition of many factors has caused the development of the environmental industry to encounter strong impact from all aspects.

However, Zhao Wei still believes that the current debt default of environmental protection enterprises is a minority, and the operating fundamentals of most environmental protection enterprises are still good. Financial institutions such as banks should treat enterprises differently and reasonably control risks. Do not engage in "one size fits all". The government should also think about how to create a more equitable and orderly market environment and rely on market forces to achieve high-quality development in the industry.

Judging from the statistics of the national statistics, the development of the environmental protection industry as a whole has not slowed down due to financial problems. In 2016, the national environmental protection industry sales revenue reached 1.15 trillion yuan, which has become a trillion-dollar industry. In 2017, the income from environmental protection industry was 1.35 trillion yuan, a record high growth of 17.4% over the same period of last year; the sales revenue in the first quarter of 2018 was about 279.4 billion yuan, a year-on-year increase of 15%.

Summary: In the first half of the year, the strengthening of the de-leverage at the national level did have a certain impact on the capital chain of environmental protection enterprises, but the main problem lies in enterprises, "human disasters are greater than natural disasters." With the promotion of structural de-leveraging in the second half of the year, no longer “one size fits all”, state-owned enterprises will be the focus of de-leveraging, and the pressure on private enterprises will be reduced.

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