In Shanghai, only four of the 20 pulp-package manufacturing lines are running, as half of the city's paper container makers report they are struggling to stay in business.

Industry insiders say the reason sales have not taken off as expected is because of weak enforcement of the plastics' ban, and the strong position held by the companies that make these products.

"We have very limited orders, and one-third of our machines are idle," said Qian Zhiming, deputy manager of Shanghai Jieyu Green Packaging Products Works, which makes paper food containers. "The sluggish market doesn't appear ready to rejuvenate any time soon."

Encouraged by the central government's 1999 ban on the styrofoam-type containers popular for food takeaway, hundreds of domestic companies began production of paper tableware a few years ago. The industry geared up quickly with annual production capacity of 3 billion paper boxes.

"In theory, our production shouldn't be enough to meet domestic demand, but the fact is that most production lines don't run, and a great number of the products are exported," said Qian.

The shift from the plastic food trays, which are not biodegradable and thus take up large amounts of space in landfills, goes back to 1995, when the country signed an international agreement calling for the elimination of these containers by 2005.

Following new regulations from the State Economic and Trade Commission, the city announced an intention last June to restrict production and mandate recycling of the plastic products.

"The government took too long to replace the plastics, and the dynamics of the enforcement program are too weak," said a senior executive at Shanghai Luhuan Environment Protecting Product Making Co. Ltd. who identified himself only as Zhou.

His view was echoed by a majority of paper-container producers interviewed by Shanghai Daily. They complained that local government was too timid in eliminating the use of plastic food containers, despite its tough rhetoric.

"The food stands on the street are not willing to cut their profit margins by using paper containers that carry a higher price," said Zhou.

A paper container normally costs 0.12 yuan (1 U.S. cent), double the cost of a plastic container.

Even though the industry's days appear to numbered, there are still nearly 100 producers and dealers of plastic tableware, including some foreign-invested large-scale ventures.

The city has taken a moderate attitude toward the problem for fear of layoffs at these companies, say industry officials.

Local government does require producers and dealers to pay for recycling their products - 0.03 yuan for each 5-gram container - but the fees are seldom enforced, say critics of the system.

"The Shanghai government has to be cautious due to the large size of the city's plastics industry," said Huang Longzhou, deputy general manager of Nanjing Xingerui Automatic Equipment Manufacturing Co. Ltd., which supplies production equipment for paper food containers.

Zou Hua, of the sanitation bureau, said the city will consider tax cuts for container makers to encourage environmentally friendly substitutes.

(Eastday.com 06/13/2001)