China's march toward carbon neutrality is having a real and positive impact, said HSBC Bank PLC in a report. Over three quarters of foreign companies feel that China's desire to transition to a net-zero economy makes expanding there more attractive, said a recent HSBC survey of 2,174 companies across 10 major economies.
International firms believe business opportunities will arise from the net-zero agenda, with 52 percent planning to offer greener and more sustainable products for the China market, according to the survey.
China is making great strides to reduce carbon emissions and tackle climate change alongside other economies, HSBC said. The country has promised to peak its carbon emissions by 2030 and achieve carbon neutrality by 2060. It further pledged to stop building new coal-fired power projects abroad in September.
Standard Chartered Bank (China) Ltd signed a strategic cooperation agreement with the China (Shanghai) Pilot Free Trade Zone Lin-gang Special Area Administration and Shanghai Lingang Economic Development (Group) Co on Nov 6 to jointly promote sustainable finance in Lingang Special Area, a part of the China (Shanghai) Pilot Free Trade Zone.
Giving full play to its global networks and resources, Standard Chartered will help Shanghai Lingang Economic Development (Group) Co and the companies located in the special area obtain financing for sustainable development from domestic and overseas financial markets. The bank will offer them products and solutions, including green loans, green bonds and ocean-centric blue bonds, to develop eco-friendly and innovation-driven economy and low-carbon economy.
Financial institutions should strengthen support for green industrialization for sustainable growth. They should fully utilize indirect and direct financing instruments to promote their business expansion, create a green assets balance sheet, and support various activities which will contribute to carbon emissions reduction, said Lyu Jiajin, chairman of Industrial Bank Co Ltd, a national joint-stock commercial bank based in Fuzhou, Fujian province.
Lyu called on financial institutions to use their expertise to help all kinds of market entities manage carbon assets, activate carbon pricing and create a larger carbon trading market.
Financial institutions should push for China's green transition in a steady and orderly manner. They should also avoid implementing the same lending policies for all corporate borrowers across the board and avoid requiring high energy consumption enterprises to repay loans early, so as to prevent risks during the process of reducing carbon emissions, he said.
China must make phased plans and implementation measures and make progress step by step during the process of achieving the goal of green and low-carbon transition, said Xiao Yuanqi, vice-chairman of the China Banking and Insurance Regulatory Commission.
The financial sector should develop products targeting high-emissions industries to meet their demands for the updating of technologies during the transition, Xiao said in a speech delivered at the 2021 Annual Conference of Financial Street Forum on Oct 20.
"China's goals of reaching carbon emissions peak by 2030 and achieving carbon neutrality by 2060 will restructure its current model of economic development. The country must actively explore measures to maintain a balance between economic growth and sustainable development," said a report issued by China Lianhe Credit Rating Co on Saturday.
Some sectors such as coal mining and coal-fired power generation industries will face the risk of a shrinking market as well as the pressure of production capacity reduction and business transformation. At the same time, China will improve the energy utilization efficiency in iron and steel, nonferrous metal, chemical, construction and building materials industries via technological upgrading. It will also actively pursue electrification transformation of these industries, the report said.
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