A Speech delivered by CCIEE Vice Chairman Zhao Jinjun at the 2017 Paris Climate Finance Day

Ladies and gentlemen, dear friends,

On behalf of China Center for International Economic Exchanges, I am very pleased to have the opportunity to share my views with experts and scholars from various countries on the eve of the Paris Climate Finance Day.

As we all know about it, dealing with climate change has become a major challenge facing all mankind, which is also why the Paris Agreement has attracted global attention.

Although the current world economy has shown the sign of recovery, its growth, nonetheless, remains to be unbalanced. The damage to our environment caused by the traditional mode od extensive development still threatens the survival and development of mankind.

Fortunately, most of the countries have advocated the earnest implementation of the Paris Agreement, except for a few countries. They have also formed a good momentum for jointly tackling the climate change challenge and strengthening ecological protection. The heated discussions at the UNFCCC, which ended just last month in Bonn, underlines the strong determination of all nations to cope with the climate change and promote sustainable development.

Although China has the largest population, the hardest economic development task and the most diversified natural conditions, it has always attached great importance to climate change. In the past years, China has changed its mode of production and lifestyle, conducted supply-side structural reform to eliminate outdated production capacity, reduce financial leverage, adjust and optimize its energy mix as well as increase non-fossil and renewable energy sources. All these efforts helped China to reduce its emission of greenhouse gas. According to the latest monthly data released by China, the thermal power generation in China dropped by 3% from January to October this year, while solar power generation increased by 36%, hydropower increased by 17%, wind power increased by 12% and nuclear power increased by 15%.

Today, China has become the largest and fastest-growing producer of clean energy in the world. In addition, China conducts long-term strategies to promote green development such as reforestation and reclamation of desert areas. The area of China’s plantation has reached 53 million hectares, the biggest in the world. According to statistics, China has reduced 4.1 billion tons of carbon dioxide emissions over the past 10 years while promoting its economic development, demonstrating the coordinated harmony between social development and dealing with climate change.

Undoubtedly, financial assistance is essential for dealing with climate change. In recent years, China has attached great importance to the role of finance in promoting green development and has established a green finance market. For example, the global issuance of the green bond was 94.5 billion US dollar in the first nine months this year, of which 17.2 billion comes from China, making it the largest issuer. In addition, the total amount of green credit granted by China amounted to 7.51 trillion RMB, accounting for 8.8% of China’s total credit.

At the G20 summit held in Hangzhou, China last September, green finance was included in the core issues of the summit for the very first time. During the summit, the People’s Bank of China and the Bank of England jointly proposed a comprehensive report on green finance, including seven proposals for developing green finance. Recently, China has also completed the preparation for creating a nationwide carbon emissions trading market, with an expected trade value of 700 billion dollar. I believe that China’s launch of the world’s largest carbon market will surely play a significant role in China’s green economy.

In the past, China has implemented the following approaches to carry out its own green finance practice.

Firstly, giving full play to the guiding role of the government. On one hand, we formulate and perfect the policies and measures for guiding the development of green finance. For example, together with the other seven ministries, the People’s Bank of China released the Opinions on Building a Green Financial System at the end of 2015, proposing 35 concrete measures for developing green finance and establishing a complete green financial policy system. On the other hand, the Chinese government has also clearly stipulated to speed up the creation of a green financial system in the 13th five-year development plan for 2016-2020.

Secondly, we start with pilot projects or areas first and gradually pass the experience to other cities. This year, the Chinese government has set up the pilot zone for green finance reform in Guangdong, Zhejiang, Jiangxi, Guizhou and Xinjiang, and explored effective practices of green finance in promoting the transformation and upgrading of traditional industries and developing clean energy. Some banks in Zhejiang Province also launched the so-called “green loans” and other emission rights-related loans to ease the collateral problem in green financing.

Third, we allow the market players to play a more positive role. Currently, many financial institutions such as the Commercial Bank of China and Industrial Bank have set up a special green finance department to issue green credit, enterprises can issue green bonds through the capital markets, and the insurance companies are also launching green insurance products. As can be seen, the enthusiasm of all market players has been mobilized to promote the green financial development.

Looking forward to the future of China and the world economy, green finance has great potential for development. All countries should strengthen mutually beneficial cooperation and I would like to put forward four suggestions.

First of all, we should strengthen international cooperation in green finance, formulate standards for international green finance based on the Paris Agreement, further promote the development of an international market and improve the rules and management system.

Secondly, the governments around the world should fully mobilize the enthusiasm of financial institutions, enterprises and other market participants in the building of a green financial system, increase green credit supply and green financial products, so as to meet the funding needs of green economic development.

Thirdly, we should carry out cooperation with the international financial institutions. Specifically, all the countries should emphasize the role of international development financial institutions such as the World Bank, European Investment Bank, Asian Development Bank, Asian Development Bank, New Development Bank of BRICS to promote green and sustainable development in their own countries and regions. At the same time, all countries should also be urged to participate independently in the building of the Belt and Road, which is a new platform for pushing forward international innovation, cooperation and win-win outcomes.

Fourth, think tanks should pay more attention to the research on the development of green finance. We should expand international cooperation and academic exchanges, share green development experiences and provide intellectual support for the sustainable development.

Ladies and gentlemen,

Having considered the continued damage to the ecological environment and severe challenges of climate change we are facing, the international community should enhance its sense of urgency, responsibility and cooperation. Dealing with climate change should become our common mission and China is ready to cooperate with other nations in this aspect.

I remember that in December 2015, President Xi Jinping announced at the Paris meeting that China will establish a fund of 20 billion yuan for the South-South Cooperation in Climate Change, also known as the “Ten-Hundred-Thousand Action Plan”: we will set up 10 Low-carbon demonstration areas, 100 climate change mitigation projects and provide 1,000 training places for dealing with climate change in developing countries. China has also donated 6 million dollar to the United Nations as funding for South-South Cooperation in Climate Change. Apart from that, China helped more than 70 developing countries through cash and supplies, covering such projects and fields as clean energy and low-carbon demonstration.

President Xi Jinping repeatedly appealed that all countries should work together, promote mutually beneficial cooperation and jointly build a common community of shared future for all mankind. We believe that all countries work together to combat climate change is a major contribution to achieve that goal.

Thank you!