China's green finance drive picks up pace

BEIJING — The development of green finance in China has entered the fast lane, and is playing a vital role in the country's long-term pursuit of low-carbon and sustainable growth.

Green finance aims to fund the development of sustainable industries as well as the low-carbon transformation of traditional ones.

At the 14th Lujiazui Forum held in Shanghai recently, Yi Gang, governor of the People's Bank of China, the central bank, highlighted the significance of green finance amid the country's steady progress toward its dual carbon goals.

China has said that it will peak carbon dioxide emissions by 2030 and achieve carbon neutrality by 2060, which will bring profound changes in every area, including industrial and energy structures, as well as modes of production and living, said Yi.

In recent years, China has doubled down on efforts to develop green finance.

This has yielded fruitful results, putting in place a multitiered green finance market system, with outstanding green loans and bonds both ranking among the top in the world.

By the end of the first quarter of 2023, the country's outstanding green loans in yuan and foreign currencies exceeded 25 trillion yuan ($3.48 trillion), while its outstanding green bonds surpassed 1.5 trillion yuan, data from the PBOC shows.

Green bonds issued by domestic commercial banks this year before June 12 reached 243 billion yuan, surging by 88.26 percent year-on-year, according to data from financial information services provider Wind Information.

In recent years, policy incentives have played an active role in supporting green finance in China.

In 2021, the PBOC launched two new special tools that offer low-cost financing for initiatives involving carbon reduction, as well as cleaner and more efficient coal use. These attached greater significance to the role of the market and encouraged more social capital to flow into green and low-carbon areas.

This year, the credit facility for supporting carbon emission reduction was extended to the end of 2024, while the implementation of the special relending tool for promoting the clean and efficient use of coal was extended to the end of this year.

By the end of April 2023, China's carbon-reduction credit facility had financed carbon-emission cuts of more than 150 million metric tons, data from the PBOC reveals.

Under the completed policy system, green finance will embrace huge development opportunities in China.

Xinhua