IFC says China could lead US$3.5 trillion global efforts to make construction industry chains greener

Global climate goals are unlikely to be achieved without a reduction in emissions from the construction and operation of buildings, IFC report says

China will need to spend US$1.33 trillion if it wants to align its construction value chains with global climate ambitions: IFC

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A file photo of a construction site in Wuhan, Hubei province, from November 2021. Photo: Xinhua

Published: 7:00am, 27 Oct 2023

China, which has the world’s largest buildings construction industry chains, has the potential to lead the world in decarbonising the sector over the next decade, according to new research by the International Finance Corporation (IFC).

It will need to spend US$1.33 trillion, nearly 40 per cent of the about US$3.5 trillion needed globally, on cutting construction-related carbon-dioxide emissions, so that by 2035, these emissions will be 13 per cent below last year’s levels, the IFC said in a report published on Thursday.

This target will put the world on the path to achieving global climate ambitions of net-zero emissions by 2050.

“Construction value chains in emerging markets are a major contributor to global carbon-dioxide emissions, and the problem is set to get worse by 2035,” the report said. “Global climate goals are unlikely to be achieved without a reduction in emissions from the construction and operation of buildings.”

The IFC, which is part of multilateral development lender World Bank Group, is the largest development institution focused on the private sector in developing countries.

China, responsible for 54 per cent of global steel output and 60 per cent of cement production last year, was responsible for 40 per cent of the 15 billion tonnes of global construction value chain carbon-dioxide emissions in 2022, IFC’s researchers said. High-income countries contributed 31 per cent and all other emerging markets together accounted for 29 per cent.