Thomas White Global Investing
China Stamp
September 12, 2008
A Postcard from China
China: China’s Booming Economy Feeds on Coal

Canada Geothermal Energy In Datong, a donkey pulls a cart with his quota of the more than six million tons of coal which will be produced in one day in China. This is far more than in the U.S. (3.2 million tons a day), Europe, and Russia combined.

Winter has set in Datong, Shanxi Province. Fresh snow paves the sidewalks. The snow though, is not blinding white. Black hues rip through it. Despite the chilly, crisp weather, the air appears dusty. A gray smog lays its hand across the city.

Welcome to one of China’s biggest coal producing regions. Although Datong boasts a World Heritage Site, the bulk of the region’s income is not from tourism, but raked in from its extensive coalmines.

The country’s booming economy feeds on coal, which meets around 70% of its energy needs. More than six million tons of coal is produced a day, far more than in the U.S. (3.2 million tons a day), Europe, and Russia combined. It is the largest consumer of coal with its 21,000 mines spewing out 2.58 billion tons in 2007.

China will build 500 coal-fired power plants in the next decade, at the rate of almost one a week. This voracious demand has fueled the growth of many illegal coal mines, making the industry among the deadliest in the world, with more than 2,000 workers killed in 1,320 accidents in the first seven months of 2007.

In neighboring Shaanxi Province, working conditions for miners remain abysmal. Around 600,000 miners are believed to be suffering from pneumoconiosis, with the figure increasing by 70,000 miners each year. Environmentally, a toxic brew of soot and chemicals is blown across to Seoul, and as far away as the U.S.

China’s hunger for coal is powering its surging economy, giving new life to millions; yet the mines take more than they give sometimes. This time, they are taking the environment into their dark bowels.


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