The Tianjin Explosions and Their Implications

Comment by Shanghai-based chemical industry consultant Kai Pflug

  • Dr. Kai Pflug, CEO, Management ConsultingDr. Kai Pflug, CEO, Management Consulting

On August 12, a fire at a dangerous goods warehouse operated by Ruihai Logistics at the Tianjin harbor quickly turned into a disaster as it triggered two substantial explosions, very likely due to chemicals stored in the warehouse. These included 700 tons of sodium cyanide, 800 tons of ammonium nitrate, 500 tons of potassium nitrate and unknown amounts of calcium carbide. More than 100 people died, many of them firefighters, and several hundred people were injured, many of them residents in apartment complexes near the warehouse.

Insufficient Implementation of Existing Regulation

In the aftermath of the explosions, local media uncovered several examples for regulation being ignored at the Tianjin site. For example, the amount of sodium cyanide stored at the warehouse exceeded the legal limit by a factor of 70. The warehouse is located only 600 meters away from residential buildings, not the mandated 1,000 meters. And state media revealed that the organization operating the warehouse had only received its authorization to handle dangerous chemicals less than two months earlier, meaning that it had been operating illegally between October 2014 and June 2015.

Lack of Qualified Emergency Response

Other criticism has focused on the emergency response. According to a spokesperson of the fire department, it was known to the fire fighters that calcium carbide was stored at the warehouse, but the exact location was not known. Other sources such as the Beijing News state that the firefighters were not aware of the fire involving chemicals at all. In any case, the firefighters tried to stop the initial fire using water rather than sand or foam, which would have been the appropriate approach. This may have caused the formation of acetylene from the calcium carbide and the subsequent explosions. The apparent ignorance of firefighters regarding their approach may be partly explained by the two-tier structure of China´s firefighting force, in which a substantial share of the staff is low-paid and presumably has limited training as well.

Initial Government Reactions

So far the government has taken a fairly open approach in their response to the disaster.

For example, the State Council Work Safety Commission stated that the Tianjin blasts revealed a lack of safety awareness and lax implementation of safety regulations. The commission also mentioned other problems including inadequate safety management of dangerous materials at ports, irregular practices among workers, weak emergency responses to incidents and lax supervision by authorities. Other government measures include the arrest of the warehouse management and investigations regarding the current director of the State Administration of Work Safety, who also is a former deputy mayor of Tianjin. On a more proactive note, the government has announced that in the period until September 10, they will check all dangerous substances across the whole country.

Long-term Implications

It remains to be seen whether this disaster will actually have substantial longer-term implications for the chemical industry – as always, China is better at establishing decent regulations than at implementing them. Currently such implementation certainly has some momentum. For Western chemical companies operating in China, a stricter implementation of existing regulation would certainly be a good thing – they generally adhere to this regulation already but sometimes suffer from local competition with laxer standards. On the other hand, some of the regulation is likely to lead to higher cost of doing business in China, for example when knowingly or unknowingly using the services of companies such as Ruihai in providing logistics services. Western companies therefore also need to be willing to choose their Chinese business partners not only based on price, but also on their broader adherence to elevated standards.

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