BEIJING, April 28 (Xinhua) -- China has accelerated its paces to set up a green finance system for supporting building a green Belt and Road since May 2017 when the first Belt and Road Forum for International Cooperation was convened.
Year to date, China made lots of efforts to facilitate sustainable development of the Belt and Road-related countries and regions, including initiating the "Green Investment Principles for the Belt and Road", and actively pushing for greening of Belt and Road investment.
-- Green finance system improved to better support green Belt and Road
Currently, one of the largest green financial markets worldwide has been formed in China thanks to efforts made by Chinese central bank - the People's Bank of China (PBOC) and relevant ministries.
Recent years, PBOC together with relevant Chinese ministries have put into practice a series of policies and documents including the guidance towards constructing a green financial system, which helped establish the framework policies to systemically propelling development of green finance in China.
By the end of 2018, more than 700 billion yuan of green bonds have been issued by Chinese financial institutions and enterprises at home and abroad and in the first quarter of this year, comparable figures rocketed 178 percent year on year.
Under such circumstances, developing green financial market of China is significantly meaningful to constructing the green Belt and Road and assisting related countries and region to achieve green and sustainable development.
For one thing, Chinese financial institutions can provide financing for green Belt and Road projects to satisfy their green investment demand. For another, organizations from countries for co-building the Belt and Road and international financial institutions can issue green bonds in China to directly finance their green projects construction. What's more, the Belt and Road countries and regions can take reference from China's experience in founding a green financial system and developing green financial market.
-- Deeper participation in global cooperation cements understanding and supports to green finance
Via profound participation in global cooperation, China joined hands with other countries in cementing Belt and Road countries' understanding and supports towards green finance.
In 2016, China initiated establishment of the Green Finance Study Group under its presidency of the G20. In 2017, PBOC participated in initiating the Central Banks and Supervisors Network for Greening the Financial System (NGFS) and shared with central banks and supervisors of other countries experience of developing green finance.
At present, there are more and more non-G20 countries interested in considering boosting green finance and taking part in global cooperation.
For instance, such Belt and Road countries as the Mongolia, Kazakhstan, and the United Arab Emirates (UAE) have started or already formulated their green finance development plans.
By end April of 2019, members of the NGFS have grown from eight at the beginning to 36 ones including central banks and regulators from countries like Thailand, Malaysia, and Morocco.
In some of the Belt and Road countries, green finance concept has become deeply rooted, good for fostering green and sustainable development of these economies and building the green Belt and Road.
Apart from these, Green Finance Committee of China Society for Finance and Banking and the City of London Corporation led the initiative to draft and promulgate the "Green Investment Principles for the Belt and Road" (GIP) in November 2018 to encourage green investment by relevant financial institutions and enterprises.
Since its debut, the GIP has been warmly echoed by the global financial community. By April 25, 26 large financial institutions from 13 countries and regions around the world have signed up to the principle.
-- Green Belt and Road expectable
Upon the increasing global knowledge towards environment and climate change risks, investors' acceptance of green financial products gradually improve thus greening the Belt and Road is expectable.
So far, a large number of countries have seen the increasing urgency of green development and building the green Belt and Road receives wide supports from the international community.
More and more financial institutions began to realize practicing green finance represents not only social responsibility but also crucial development opportunities and inherent requirements to guard against risks for the financial industry itself.
Statistics show that average default ratio of green lending of China's main commercial banks stay below the comparable figures for their loans of other types.
What's more exuberant, general acceptance of the environmental, social and governance (ESG) investment concept by global institutional investors such as pension funds, and mutual funds has helped raised their risk preference to green assets in recent years. Under such circumstance, there will be more global investment going into related green programs and financing the green Belt and Road.
Besides, many countries including China and international organizations as well are actively carrying out capability construction to support construction of the green Belt and Road.
For example, green finance knowledge sharing and capability construction platforms for the Belt and Road-related government departments, regulators, financial institutions and employees are rolled out to the end, helpful to give full display of the late starter advantage of Belt and Road countries in greening the Belt and Road. (Edited by Duan Jing, duanjing@xinhua.org)
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