China’s post-pandemic economic stimulus spending on green projects shows there is room for improvement: Greenpeace

Name: China launches world’s largest carbon-trading scheme as part of 2060 carbon neutrality goal
Uploaded: 2021-08-02T01:30:17.000Z
Duration: 2 min 38 s
Description: China launches world’s largest carbon-trading scheme as part of 2060 carbon neutrality goal

Only 15 per cent of China’s newly added post-Covid-19 national and municipal bonds went to green, sustainable, or low-carbon projects, says Greenpeace

China approved a fiscal stimulus package of 6.35 trillion yuan (US$984 billion) in May last year to help the country’s economic recovery after the pandemic

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Greenpeace said the gap was widening between Chinese provinces that were leading the country’s green transformation and those that relied heavily on coal. Photo: Bloomberg

Yujie Xuein Shenzhen

Published: 9:30am, 2 Aug 2021Updated: 9:30am, 2 Aug 2021

Only a small percentage of China’s post-Covid-19 economic stimulus went to projects related to green and sustainable development, while huge investments were poured into carbon-heavy traditional infrastructure sectors, an analysis by Greenpeace found.

The study, published by Greenpeace East Asia on Monday, tracked how different Chinese provinces directed the relief stimulus packages in the past year based on publicly available government work reports and media coverage.

The environmental group found that about 90 per cent of Covid-19-relief national bonds and 60 per cent of newly added municipal bonds went to traditional infrastructure. Only 15 per cent went to green, sustainable or low-carbon projects, including green infrastructure, green transport, agriculture, forestry and waterways.

There was also a widening gap between provinces that were leading the country’s green transformation and those heavily reliant on coal on how much they spent their fiscal stimulus package on green projects, Greenpeace found. Regions like Tianjin, Shanghai and Guizhou spent higher percentages of municipal bonds on green projects, such as green transport and agriculture. On the other hand, Shanxi and Inner Mongolia, both provinces that are heavily reliant on coal mining and energy generation, have made very little investment in green initiatives.

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China launches world’s largest carbon-trading scheme as part of 2060 carbon neutrality goal

“The way local governments are conceptualising their opportunities to stimulate the economy in a green and sustainable approach is still a big issue,” said Liu Wenjie, a policy analyst at Greenpeace East Asia’s Beijing office. “While some parts of China are working towards a green and just recovery, others are missing the boat entirely.”

The National People’s Congress, China’s parliament, approved a fiscal stimulus package of 6.35 trillion yuan (US$984 billion) in May 2020 to help the country’s economic recovery after the pandemic. The stimulus, which included an extra 1 trillion yuan in deficit funding, a special national bond issue of 1 trillion yuan, 375 million yuan in municipal bonds, and 600 billion yuan in investment from the central budget, was equal to 6.4 per cent of the country’s gross domestic product for 2019.

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