Venture capital and private equity (VC/PE) investment in China's clean technology field recorded 26 transactions valued at a combined $294 million in the first half of 2012, according to Zero2IPO, a Chinese consultancy on VC/PE funding.
The number of transactions recorded has fallen sharply over the past five years, and the aggregate amount of investments dropped dramatically from the first half of 2011, Zero2IPO said, citing a declining market for VC/PE as well as the Chinese clean technology industry's problems from within, which could have kept investments away.
Some Chinese cleantech companies mainly export their products overseas, so a trade dispute could hit them hard. For instance, the United States slapped up to 250% antidumping taxes and countervailing duties on Chinese crystalline and silicon cell makers in May, Zero2IPO noted.
Another problem is that survival and growth of China's nascent cleantech market is highly dependent on unsustainable government policies instead of consumer demand.
Despite waning VC/PE investment in the photovoltaic and wind power industries in China, transactions associated with environmental protection as a percentage of total VC/PE funding is climbing, with special attention paid to industrial dust elimination and industrial waste disposal, Zero2IPO added.