China has industrialized at a more rapid rate more than any other nation in the world. The per capita income of the country was $195 in 1981. Rapid industrialization made the per capita income of the country be $4,428 in 2010. During the 1980s, approximately 80% of Chinese were peasants. However, currently, more than half of the population lives in cities. Despite the fact that industrialization and urbanization have improved the welfare of the Chinese, the country’s legal institutions have been unable to formulate environmental protection laws that keep pace with the growth in economic output. According to the World Bank (2008), China has 16 of the 20 most polluted cities in the world. In addition, 20% of the major rivers in China are polluted. In 2006, China eclipsed the U.S. to become the largest pollution emitter in the world (World Bank, 2008). Pollution has harmed the international reputation of China and its economy. It is common for Beijing, China’s capital, to experience smog. The difference between environmental regulations in the U.S. and China would have a significant effect on U.S. pharmaceutical companies that intend to set up their operations in China.
Over the past few years, China has strived to modernize its laws. The Environmental Protection Law of the country has been almost completely rewritten. This has helped in strengthening the law regime of the country. Most new provisions of the Environmental Protection Law would become applicable in the next few years. The provisions would affect a U.S. pharmaceutical company that intends to set up its operations in China. The provisions would necessitate the company to ensure that it uses recyclable materials in producing various drugs. It would also require the company to reduce pollution from its manufacturing processes. The company should ensure that it incorporates installation for prevention and control of pollution while constructing the plant. The installations should comply with the standards approved by various pollution regulatory authorities. The company should not leave the installations idle or dismantle them without prior authorization. This measure would ensure that the installation always help in reducing the environmental impact of the company. Pharmaceutical companies discharge pollutants. The new regulations would necessitate the companies to implement measures that would control environmental pollution caused by waste gas, waste water, residues, noise, or radioactive substances. The company would have to establish an environmental accountability system and identify employees who would be responsible for the system (Gang, 2009).
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