Financing China’s Clean Revolution report preview

3 November 2011

BEIJING: The Climate Group Greater China has published a briefing note based on our fourth annual China’s Clean Revolution report, Financing China’s Low Carbon Growth, the full report of which is to be published later in November.

Financing China’s Low Carbon Growth is the country's first comprehensive review of China's strategy to finance its low carbon economy.

The report explores: 

  • the fiscal and financial policies and instruments in place to meet China’s climate and energy goals
  • the evolving role of Chinese financial institutions in supporting these goals
  • opinions on the level of investment today and the investment needed going forward
  • current challenges and barriers to progress.

The research that supports the report is based on reviews of existing literature, as well as our own interviews with 20 experts who are closely involved in Chinese policy.

Interviewees include representatives from the Ministry of Finance, National Development and Reform Commission (NDRC), Tsinghua University, Chinese Academy of Sciences and Chinese Academy of Social Sciences.

The report also reviews a number of sectoral and regional case studies, including the role of Hong Kong as a financial and knowledge center.

Exploring the already positive progress of low carbon economy financing, key indications include the following:

  • Central Government investment in the energy efficiency, renewable energy and environmental protection sectors has grown steadily from US$3.7 billion (RMB 24 billion) in 2007 to a projected US$16.8 billion (RMB 107 billion) in 2011
  • In 2010, the venture capital (VC) sector completed 84 clean technology transactions totaling US$508 million (RMB 3.2 billion), more than doubling on the previous year and increasing annual investment by over 40%. Clean technology ranked second in attracting VC finance amongst 23 industrial sectors
  • Similarly for private equity, 2010 saw the clean technology industry ranked second in China by number of transactions (31 in total) and 10th by total investment at US$330 million (RMB 2.1 billion). 

Changhua Wu, Greater China Director, The Climate Group says: "This report zooms in on China’s financing landscape, and the strategy designed to achieve its Clean Revolution. China’s efforts set a pioneering example for the global community on integrating energy efficiency, clean energy and carbon emissions into an overall national development strategy focusing on economic and industrial restructuring. As illustrated by the report, the capital required to achieve those ambitions is large. But it also presents the opportunities for technology innovators, investors, and other countries and regions to work with each other to revitalize a global economy ridden by financial, energy and climate crises."  

This briefing will be distributed at the Hong Kong Business Summit on Climate Leadership on November 7, 2011 as a preview to the full report, which will be fully released (in Mandarin) in late November.

Download the briefing note

Read more about the Business Summit on Climate Leadership conference

Report: Low Carbon Growth: A Guide to China's 12th Five Year Plan

Blog: Chaghua Wu

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