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E-mail China.org.cn, February 7, 2024
China News Service:
In promoting green finance, what specific implementation plans and incentive measures does China have to promote green and low-carbon transformation and the development of the environmental protection industry?
Li Mingxiao:
Thank you for your question. We have always placed great importance on green finance, and China's green finance is at the global forefront. In recent years, the NFRA has adhered to the guidance of Xi Jinping Thought on Ecological Civilization. It has encouraged the banking and insurance systems to increase financial support for green development, continuously improving the service quality and efficiency of green finance, and thus promoting the green transition of economic and social development. We have carried out work in the following five aspects:
First, we have strengthened regulatory guidance. We have promoted the implementation of the "Guidelines for Green Finance in the Banking and Insurance Industries." We have enhanced tracking, monitoring, and supervision, organized symposiums on green finance services, and guided banking and insurance institutions to develop green finance from a strategic height. This includes increasing support for green, low-carbon, and circular economies, preventing environmental, social, and governance risks, and improving their own environmental, social, and governance performances. We have also worked with relevant departments to promote the construction of a green finance standard system. We will research and improve green finance support measures in the fields of industry, construction, and ecological and environmental protection, guide localities in exploring green finance practices, and improve various supporting policy measures.
Second, we improved statistical monitoring. We regularly organized banks to tally green financing data, used all sorts of funding to offer support, and guided banks' credit funds to support the development of green and low-carbon industries in a market-oriented and law-based manner. As of the end of 2023, 21 major banks' green credit balance reached 27.2 trillion yuan, up 31.7% year on year. We improved the statistical standards for green insurance and pushed for insurers to enhance risk protection in the fields of environmental resource protection and social governance, green industries, and green living consumption. In 2023, green insurance premiums reached 229.7 billion yuan, with insurance indemnities reaching 121.46 billion yuan.
Third, we optimized performance appraisals. We organized 21 major banks to conduct green credit self-evaluation and urged self-examination and prompt rectification in accordance with relevant supervision mechanisms and criteria. We guided the China Banking Association to conduct green banking reviews. Green financing has been seen as an important reference for the regular supervisions, on-site inspections, and corporate governance requirements of banks and insurers, enhancing the incentives and constraints to promote the development of green financing.
Fourth, we enriched products and services. We encouraged banks and insurers to fulfill their duties and develop climate-friendly green financing products, lawfully, with controllable risks and business sustainability, and meet green and low-carbon projects' financing and risk management requirements so as to provide diversified and differentiated financing services. We broadened the coverage of green insurance, developed green trust funds and green leasing, and expanded green consumption credit services in an orderly manner. We steered insurance funds to support green projects' investment and construction.
Fifth, we strengthened risk management. We set up information-sharing mechanisms with other departments in charge of these industries to promote regulatory coordination. We urged banks and insurers to establish and improve green financing management systems and include environment, society, and governance-related requirements into the comprehensive risk management system. We strictly controlled new financing projects related to carbon emissions and firmly curbed the unbridled development of projects with high energy consumption, high emissions, and low quality, so as to reduce carbon emissions and ensure energy safety and industrial and supply chain safety. We guided banks and insurers to explore and address climate-change related financial risks and enhance risk management and information disclosure.
In the next step, the NFRA will firmly implement the decisions and arrangements of the CPC Central Committee and the State Council, fully advance the grand strategy of promoting green financing, improve the policy system for developing green financing, optimize financial products and services, and guide banking and insurance sectors to provide financial services and contribute to achieving peak carbon emissions and carbon neutrality and building a beautiful China. Thank you.
