Korea's Environmental Policies

1. AMCHAM Presentation Tuesday, 09/07/06 11:30 ~ 13:30 Lotte Hotel Charlotte Room(36thFL.) Korea's Environmental Policies Sept. 7, 2006 KMOE Deputy Minister for Environmental Policy Jung-ho Moon

2. Contents Environmental Mgmt. Conditions & status Ⅰ Mid to Long-Term Environmental Policies Ⅱ Major Policy Implementations Ⅲ

3. Environmental Mgmt. Conditions & Status Ⅰ 1. Environmental Management Conditions 2. Pollution Status

4. Environmental Conditions 97 46% of total population & vehicles in Seoul Metropolitan Area (11.8% of total land area) ※ Population density: 1,830/㎢ (4 times the nat’l average) ※ No. of vehicles: 7,110,000 (approximately 15 mil. nationally) ※ Vehicle traffic per ㎞: 290 (4.7 times higher than Tokyo; 8 times higher than Paris) 78 32 22 2.4 1.6 Sewage coverage (%) NOX in metropolitan area (ppb) Envt. expenditure/GDP (%) 1. Environmental Mgmt. Conditions Small land & high population density (World’s 3rd, 492 persons/㎢) Japan 100 Japan S. Korea 85 Advanced countries 80 U.K. 60 60 37 40 Growing environmental stress from rapid industrialization and urbanization 30 Paris OECD 15 Germany 20 7.1 Pollution factors Korea U.S. France (kg/ha) 151.1 19.7 17.2 0 SO2 Water quality standard compliance (%) No. of species (thousands) Nature preservation area (%) 1,836 203 522 Urban waste Fertilizer & pesticide use 114 231 435

5. Urban land (1,475 ㎢) National land development (’92-’04) Forested areas (804 ㎢) Farmland (889㎢) Decrease of forested areas & tidal flats due to excessive development Forested areas: 65,665㎢ in ’92 → 64,885㎢ in ’04 (annual decrease of 78㎢) Tidal flats: 3,203㎢ in ’87 → 2,550㎢ in ’05 (annual decrease of 36㎢) Additional 3,838km² of urban land expected to be used in the next 20 years

6. More leisure time with the inception of 5 day work week Rapid industrialization & urbanization Environmental pollution originated from economic growth and rapid industrialization & urbanization Development vs. Preservation & Environment vs. Economy Changes in Environmental Mgmt. Conditions Social conflicts rising from large-scale development projects (Ex.: Saemangeum Reclamation Project) Call for eased environmental regulations due to high oil price and difficulties in biz mgmt. More environmental stress and degradation from increased outdoor activities Environment, core factor in national competitiveness Paradigm shift for environmental and economic efficiency and resource recycling society Advanced countries’ strengthened environmental regulation on products

7. World Economic Forum Environmental Sustainability Index Component Advanced Vulnerable 2005 ESI Rank • Percentage of absolute preservation zone (131st) • Nox concentration in air (127th) Environmental Systems Finland Norway … Japan U.S. U.K. China Taiwan North Korea 1st 2nd … 30th 45th 66th 136th 145th 146th • Water quality (7th) • Coal consumption per populated land area (144th) • Fertilizer/Pesticide consumption (138th) Reducing Environmental Stresses • Waste recycling rates (10th) Reducing Human Vulnerability • Infant mortality rate (7th) • Percentage of undernourished population (1st) • Deaths from natural disaster (122nd) 122nd South Korea • Percentage of renewable energy (118th) • Percentage of preservation area (117th) Social & Institutional Capacity • Environmental governance (23rd) • Private sector responsiveness (18th) • Green house gas emissions (99th) • Contribution to funding of global environmental preservation projects (142nd) Global Stewardship • Participation in int’l collaborative efforts (20th) ※ 136th out of 142 in '02

8. 2. Pollution Status Water Quality Tap water source quality change in 4 major rivers Target water quality achievement rate of national rivers ` BOD (mg/l) (%) Nakdong River Yeongsan River 5.0 50 42.3 4.6 Geum River 40 4.0 1.9 (Yeongsan) 1.5 (Geum) 1.2 (Han) 3.0 30 2.6 2.0 Han River 20 13.8 1.3 (Han) 1.0 (Yeongsan) 0.8 (Geum) 10 1.0 0.0 ’94 ’96 ’98 ’00 ’02 ’05 ’94 ’96 ’98 ’00 ’02 ’05

9. Municipal waste treatment 0.03 0.01 0.02 10,000 Air Quality Waste Treatment NOx pollution in Seoul and metropolitan areas (ppm) (ton/day) 0.034 0.033 (Seoul) 47,116 50,000 Landfill disposal 40,000 24,588 30,000 Recycling 0.026 (Metropolitan area) 0.023 20,000 18,195 8,927 7,244 Incineration 2,025 0 0 ’96 ’98 ’00 ’02 ’05 ’94 ’00 ’02 ’04 ’96 ’98

10. Mid to Long-Term Environmental Policies Ⅱ 1. Vision and Goals of Comprehensive Plan for Nat’l Envt. 2. Mid to Long-Term Environmental Mgmt. Strategy 3. Major Environmental Performance Indicator for 2015

11. 1. Comprehensive Plan for National Environment Vision Building a more sustainable & advanced nation Goals • Maintaining and increasing environmental capacity of the Korean Peninsula • Establishing a society for realizing environmental equity among & within generations • Creating a sustainable resource management system • Building a stable, eco-friendly economic system

12. 2. Mid to Long-Term Environmental Mgmt. Strategy Key environmental mgmt. tasks • Conservation of sustainable nature • Efficient management of natural resources • Establishing a safe and comfortable living environment • Building interdependent relationship between economy and environment • Creating a basis for environmental equity • Enhancing environmental cooperation in Northeast Asia • Taking the lead in global efforts for sustainable development

13. 3 Pillars of national ecology: • Establishing integrated eco-network in the Korean Peninsula • - Baekdu Daegan mountain range, DMZ, and island & coastal areas • 5 major environmental mgmt. regions: • Implementing region-specific environmental management • - Seoul metropolitan area, Chungcheong region, Honam region, Yeongnam region, and Gangwon region Environmental mgmt. of national land DMZ Baekdu Daegan Island, Coastal area

14. 3. Key Environmental Performance Indicator for 2015 92.8 (Germany ’02) 90 83 90 (U.K. ’03) 78.8 60 22 (Paris ’01) 40 38 30 32(’09) 14.6 (OECD average ’03) 22 15 10 7.1 NO2 density in Seoul (ppb) Population w/ public Sewage treatment (%) No. of species (thousand) Nature preservation area (%) Advanced countries 2003 2008 (Target) 2015 (Target)

15. 1. 2006 Major Environmental Policy Tasks 2. Environmental Health Policy for Public Health 3. GHG Emission Reduction Policy Major Policy Implementations Ⅲ 4. Increased sustainability of Economic Activities

16. Beautiful Environment & Healthy Future Global sustainable development 23 23 Blue sky and clean air Clean & safe water Safe drinking water supply 2006 Environmental Policy Tasks Vision for '06 Strengthening environmental health policy 5 Major Policy Goals Preservation of healthy land environment Building clean & comfortable living envt. Establishing Sustainable Recycling economy Strengthening measures for UNFCCC Receptor-oriented environmental health policy Environmental Plan before development Establishing basis for sustainable devt. Measures for the linkage of environment and trade Enhancing Protection of vulnerable people’s health Implementation tasks Eco-production & consumption Improvement of environmental impact assessment system Promoting future env’l technology Enhancing leadership in Int’l environmental cooperation Protecting people from hazardous materials in the living environment Establishing sewerage infrastructure Establishing eco-network in the Korean Peninsula Waste recycling system Clean & safe indoor air quality management Groundwater quality mgmt. & soil preservation Sustainable water use system Securing nat’l bio-resources and diversity Fun environment education Comfortable living envt.

17. Environmental Health 10 Year Comprehensive Plan 2. Environmental Health Policy for Public Health Environmental health expert network Enactment of Environmental Health Promotion Act Reducing by half the population exposed to environmental pollution by 2015 Policy shift for public health Enhancing policy implementation Basis for environmental health 10 year comprehensive plan Health impact assessment of dev't projects on environmental health Environmental Health Research Center (March '06) Environmental standards Developing health benefit analysis technique focused on public health

18. Examining the relation between pollution and birth defects of nursing mothers, babies, and infants (’06-’10) Measures for chemical material in playgrounds (’06) Examining mercury concentration in fish & shellfish (’06-’08) Protecting children from environmental pollution Environmental Health Policy Implementation Health impact assessment of infants & children Reducing exposure to hazardous materials Monitoring system of hazardous material in children’s goods (’06-) - Examining causes of atopic dermatitis, asthma, and growth disorder - Regulation and ban on harmful materials - Providing advisory for daily maximum intake for children and others

19. Reduction of hazardous chemicals Enactment of Special Act on POPs Treatment (’06-) • Regulation criteria for production, imports, use, • and discharge of POPs Establishing treatment system for the eradication of PCBs by 2015 ※ Examination on PCB pollution of 4,000 transformers in schools and hospitals (’06) Strengthening safety mgmt. of hazardous substances Designating substances including malachite green, formaldehyde, lead, and 2 bromine compounds as restricted or banned materials Using GPS & RFID technology on vehicles transporting toxic materials and crack down on illegal trafficking of unregistered toxic materials on the Internet

20. 3. GHG Emission Reduction Policy U.S. 5,652 1st China 3,270 2nd Russia 1,503 3rd 452 9th . . . Unit: million ton CO2 emission in ’04 (IEA) 99% CO₂Emission Korea: world’s 9th largest CO2 emitter Pressure for mandatory reduction in the 2nd commitment period (2013-2017) S. Korea Biggest CO2 emission increase among OECD countries Kyoto Protocol's entry into force Estimated GDP decrease upon mandatory reduction: 3.4 trillion Won (Feb. 16, 2005) 19% 16% Czech Republic Germany South Korea ※ Scenario: 10% reduction of estimated CO2 emission of 2020 U.K. U.S. Japan -5.5% -13% * Compared with 1990 level -25%

21. Korean government’s measures for UNFCCC Comprehensive measures and action plans for UNFCCC • 1st phase (1999-’01): 36 tasks including reduction scheme, GHG reduction base system development, and technology development • - 2nd phase (’02-’04): 84 tasks including negotiation capability enhancement, response measures for Kyoto Mechanism, and PR to the public • 3rd phase (’05-’07): 90 tasks including UNFCCC implementation projects, GHG reduction projects, and climate change adjustment project • Ministry of Environment carries out climate change impact assessment, measures for climate change adjustment, waste reduction and air quality improvement scheme.

22. Implementation of Environmental Tasks Future tasks GHG emission management system • Calculation of emission volume and factorfor • electricity generation and other industries • GHG emission estimation and reporting by cement • and chemical industry, paper manufacturers Climate change adjustment roadmap for each field of industry and environment (’06.6-’07.6) Preparation for GHG emission trading • mock emission trading of petrochemical and • semiconductor industry (twice a year, starting ’06) Expansion of voluntary GHG reduction in business establishments and transportation Active participation in international efforts for sustainable economic growth and preservation of global environment Minimization of economic impact through enhancement of domestic companies’ capability to adjust to climate change Early entrance to carbon market through implementation of Kyoto Mechanism and utilization of accumulated know-how

23. Inclusion of more items for eco-label certification Voluntary green consumption agreement with industries Inclusion of more items for environmental declaration of products Development & supply of company-specific eco-products Preparing green procurement ordinances Establishing eco-product information system (’06.8) Support for sustainable business mgmt. Eco-product exhibition & green purchasing promotion fair ` 4. Enhancing Sustainability of Economic Activities Eco-friendly production & consumption Increasing eco-product market revenue by 16 trillion Won by 2010 Mandatory procurement by public offices (￦0.26 trillion in ’04 →￦1.4 trillion in ’10) ` ` Green Production Green Procurement Green Consumption

24. Environment industry figures Envt. industry nurturing strategy • Global environment industry [Annual growth] 18~20% 7% 3% World Asia China Nurturing Domestic Environment Industry • Redefining the concept of envt. industry Technology & knowledge-based service industry End-of-pipe treatment industry [Market share] S. Korea 2% • Introduction of environmental consulting • with environment review & eco-management • services Total $589 bil. Advanced countries 85% • More support for domestic companies • abroad • Top priority: businesses with competitiveness • (sewage treatment, desulfurization, CNG buses) • Dispatching envt. industry cooperation team • (China) and opening a local branch (Vietnam) • Reviewing conditions for entering markets of • India and the Middle East • Domestic environment industry • Mostly SMEs (70%w/ less than ￦1 bil. in capital) • Still in infant stage except for end-of-pipe • treatment • ※ Exports of 177 companies in ’05: ￦995.4 bil.

25. Conclusion Korea is making utmost efforts and investments for balanced development of economy & environment and regions under limited natural and social conditions. For sustainable development of Korea, both the government and economic players should put in efforts and work with each other. We invite U.S. companies in Korea to join the efforts of making our society more sustainable.