WHEN people speak of Haining, a third-tier city in Zhejiang Province, 120 kilometers from Shanghai, many first think of the leather, warp-knitting and textile industries for which the city is best-known.

However, Haining has been working hard to make a switch in its economy to develop eco-friendly businesses, instead of traditional high polluting industries.

Visitors to the Zhejiang Wankai New Materials Co Ltd, a leading eco-friendly business supported by the city government, are confronted by various types of plastic bottles.

While they look the same as those on countless shop shelves, the difference is that they can be wholly recycled and used to make other products, such as carpets.

"The recycled bottles featuring a material called PET can be used for polyester staple fiber. And this, for example can be used in making carpet," said Yang Zheng, an R&D manager with Zhejiang Wankai New Materials.

PET plastic is very clear, so it is the best material for making water and other drink bottles that require high optical clarity, Yang said.

The company supplies its PET plastic materials to many renowned beverage companies both home and abroad, such as Coca-Cola and Wahaha.

Purified water

Meanwhile, the city government requires the whole process of making these PET materials does not do any harm to the surrounding area, Yang said.

The waste water that comes from the production is purified in a waste water processing center. The processed water won't be discharged but recycled.

Yang also said the material from the bags that hold the plastic powder can be re-used to make chemical fiber products. He said his company has invested more than 40 million yuan (US$6.5 million) in environmental protection facilities - calling it an investment that is paying back.

For example, the factory uses about 300 tons of water every day, which now all comes from the waste water processing center, Yang said.

"In Haining, tap water costs 4 yuan per ton, which means we could save 1,200 yuan a day. And it is around 4,000 yuan savings for a month and tens of thousands a year," he added.

Only a few kilometers from where Zhang's factory turns out eco-friendly materials for recyclable bottles, workers are busy making equipment for purifying and processing industrial gas.

Qian Jianlong is the manager of Jiehua Holdings Co Ltd, a company that has been involved in waste processing industry for nearly four decades.

Qian said his products are usually sold to steel makers, cement plants and electrolytic aluminum makers.

"Our equipment made for steel factories collect waste particles that can be used in making cement. The particles we collect are fully recyclable," said Qian.

Qian said that more than half of the cement plants in China are using their equipment currently.

Last year alone, Qian's factory consumed around 35,000 tons of steel in production, and had an income of nearly 500 million yuan.

While leather, warp knitting and textiles in the past accounted for more than half of the city's total GDP, things are now changing.

With the rise of eco-friendly enterprises such as Wankai and Jiehua, the three traditional industries now only account for about a third of the city's annual economic output.

But restructuring has been painful.

Jiehua says it is still facing many challenges, one of which is a labor shortage.

Lack of labor

"Most local people in Haining won't just want to be a worker on assembly lines. They want to be the managers or run their own business," said Qian Yisong, chairman of Jiehua Holdings.

"In addition, many places outside Haining are also developing very fast, so many migrant workers may not come back, instead working in their hometowns."

Qian Yisong said he planned to buy more machinery to increase automation on the assembly line to compensate for the lack of labor.

The Haining Jianshan New Area Commission, operator of the two companies, has planned many detailed infrastructure projects, such as the building of houses for rent, kindergartens and schools, said Xie Yong, director with the commission.

"So far, we have planned kindergartens, primary schools and middle schools. The next step is to have more such schools and build more service facilities, as well as set up more bus routes in the east and west side of the area," Xie said.

In any case, with the rapid economic development over the past years, there is little land available for building more factories and plants.

The Haining government began to reclaim land from the north bank of the Qiantang River in 1997 and established the Jianshan area on a 42 square kilometer plot in 2005.

The local government has given subsidies to companies to locate in the area, especially those involved in eco-friendly industries, Xie said.

Both Zhang and Qian said they will continue investing in research and development to upgrade products, such as making biodegradable plastics or devices that can deal with car emissions.

While new industries in Haining are on the rise, traditional businesses are still thriving. The leather industry is now worth more than 18 billion yuan a year and a leather fashion week and design contests are held every year to showcase the work of local designers.

The city can also boast one of the most spectacular tidal bores in the world, on the Qiantang River near Hangzhou. Up to meters high and traveling at up to 64 kilometers per hour up the river, tourists come from around the world to see the surging power of the sea.

Viewing the tidal bore is part of the Mid-Autumn Festival celebrations in the area where the sound of the surge has been compared to the sound of a thousand galloping horses.

Now Haining's green industries are creating their very own surge.