Hong Kong companies that reduce their carbon dioxide emissions in the city can now sell those cutbacks in a $12.9bn global carbon credit market created under the Kyoto protocol. The new arrangements, announced by the Hong Kong government yesterday, are a step towards rectifying an anomaly created by China's "one country, two systems" rule over its special administrative region. Under this rule, Hong Kong companies are treated no differently from foreign companies when doing business in China.

Leading Hong Kong clothing manufacturers are coming together to reduce the environmental impact of their factories in response to growing pressure from international retailers. The group, the Sustainable Fashion Business Consortium, is being launched today, World Earth Day. Many Chinese suppliers are being told to clean up operations from their US and European customers. Leading the charge is Wal-Mart. The world's biggest retailer will in October convene a meeting of 1,000 of its suppliers to set goals for reducing their impact on the environment.