Green finance promotes high-quality economic and social development

Data source: People's Bank of China

China Construction Bank Fujian Province Branch uses carbon emission reduction support tools to provide customized green financial solutions for the Phase II Project of Three Gorges Group's Fujian Zhangpu Liuao Offshore Wind Farm. The picture shows wind turbine hoisting at Zhangpu Liuao Offshore Wind Farm. Photo by Tang Wei

A staff member of Anji Rural Commercial Bank (left) under the jurisdiction of Zhejiang Rural Commercial United Bank visited Zhejiang Fenghui Bamboo and Wood Products Co., Ltd. to learn about the industrial processing situation of "replacing plastic with bamboo" and corporate financial needs. Photo by Iyue

Green development is the background of high-quality development. The recently released "Opinions of the Central Committee of the Communist Party of China and the State Council on Accelerating the Comprehensive Green Transformation of Economic and Social Development" proposed to "enrich financial tools for green transformation","extend the implementation period of carbon emission reduction support tools to the end of 2027" and "provide green and low-carbon transformation in traditional industries. Measures such as providing reasonable and necessary financial support will introduce more financial" living water "to accelerate the comprehensive green transformation of economic and social development.

In recent years, under the guidance of new development concepts, my country's financial institutions have actively developed green finance, providing various forms of financial services for the construction of ecological civilization, allowing financial living water to continue to nourish green waters and green mountains. What role does green finance play in accelerating the comprehensive green transformation of economic and social development? How to better promote the high-quality development of innovative services in the financial industry? The reporter conducted an interview.

The construction of the green financial system has achieved remarkable results, providing strong impetus for green transformation and development

A "photovoltaic umbrella" is supported on the top, and "rich bacteria" grow under the shed... In the golden autumn season, in Fujian Shunchang Shunri Agricultural Development Co., Ltd., the blue photovoltaic mushroom greenhouse contrasts with the blue sky and green forest in the distance.

This is one of the rooftop distributed photovoltaic projects promoted by Shunchang County, Nanping, Fujian Province, and is undertaken by Huaneng (Shunchang) Clean Energy Co., Ltd. The project covers 12 towns and streets in Shunchang County. The planned total construction scale of the second and third phases of the project is nearly 20 MW and occupies more than 170,000 square meters of roof area. "Compared with traditional coal-fired thermal power plants, the completion of the second and third phases of the project can save more than 6800 tons of standard coal every year, reduce carbon dioxide emissions by more than 20,000 tons, and reduce sulfur dioxide emissions by more than 500 tons." Project leader Liao Guorong told reporters.

As a new clean energy source, photovoltaic power generation can produce good economic and social benefits. However, the early assembly project of the project is large and the capital needs are tight, requiring a large amount of financial support from financial institutions.

Good projects have encountered good policies. During the construction of the Shunchang photovoltaic project, the carbon emission reduction support tools launched by the People's Bank of China played an important role. In order to leverage more financial resources to flow to green and low-carbon industries, the People's Bank of China officially launched the "Carbon Emission Reduction Support Tool" in November 2021. Through the "loan first and then borrowing" approach, financial institutions provide loan support for carbon emission reduction loans issued by relevant enterprises in key areas of carbon emission reduction will be provided at 60% of the loan principal, with an interest rate of 1.75%, a term of one year, and can be renewed twice.

In order to speed up the construction of the project, Nanping Branch of China Construction Bank of Fujian Province quickly carried out project investigation and evaluation, used carbon emission reduction support tools to provide low-cost funds with a credit of 68 million yuan for the project. The loan interest rate was reduced by more than 150 basis points compared with the market interest rate, effectively reducing corporate capital costs.

In the three years since the launch of carbon emission reduction support tools, remarkable results have been achieved. The latest data released by the People's Bank of China shows that as of the end of June, the balance of carbon emission reduction support tools was 547.8 billion yuan, and a total of more than 1.1 trillion yuan of carbon emission reduction loans have been supported by financial institutions, covering more than 6000 business entities, driving annual carbon emission reductions. Nearly 200 million tons have effectively promoted the transformation of the economy and society to a low-carbon track.

In recent years, my country's green financial system has achieved remarkable results, forming a multi-level and diversified green financial market dominated by green loans and green bonds, providing a strong impetus for serving the green and low-carbon development of the real economy. As of the end of June, my country's green loan balance was 34.76 trillion yuan, a year-on-year increase of 28.5%, and a total of 3.71 trillion yuan of green bonds were issued.

"Our country has initially established a green financial system that effectively supports 'pure green' or 'near-pure green' economic activities, which has played an important role in promoting the rapid development of my country's green industry." Ma Jun, director of the Green Finance Professional Committee of China Finance Society, told reporters that with the support of green finance, my country's new energy, electric vehicle and battery industries have accounted for the largest market share in the world, and its sewage and solid waste treatment capabilities also rank among the top in the world. In addition, my country's incentive mechanism for green finance has also become a model of good practice internationally. Our country has also proposed initiatives and launched a series of international cooperation mechanisms on green finance, playing a leading role in forming a global consensus on sustainable finance, improving the compatibility of green finance standards, and providing capacity building for developing countries.

Innovate financial products and promote green transformation of economic development

Among the green waters and green mountains in Anji County, Zhejiang Province, the bamboo forests make people linger. It is known as the "Bamboo Township of China" and its vegetation coverage rate remains above 70% all year round.

To green the ecology, we must also make the people rich. In order to effectively utilize bamboo resources, Anji County seized the industrial transformation opportunity of "replacing plastic with bamboo" and used financial service innovation to leverage the green development of the bamboo industry.

In early November 2023, the National Development and Reform Commission and other departments issued the "Three-Year Action Plan to Accelerate the Development of" Replacing Plastic with Bamboo ", which put forward new requirements for further promoting the entire chain of plastic pollution. Anji Rural Commercial Bank under the jurisdiction of Zhejiang Rural Commercial United Bank continues to explore and innovate, opening a new model of green inclusive benefits leading green production and lifestyle in all aspects from the production end, circulation end and consumption end.

At Zhejiang Fenghui Bamboo and Wood Products Co., Ltd., the bamboo straw made by cutting, wire drawing, polishing and other processes is not only anti-scalding and durable, but also solves the problem that paper straw is easy to soften when exposed to water.

"Products focus on environmental protection, and production must pursue green. The equipment we independently developed has increased the utilization of raw materials by at least 20%." Liang Ruirong, the person in charge of the company, said,"'Replacing plastic with bamboo 'has brought great development opportunities to the company, but improving production equipment requires large capital investment. Anji Rural Commercial Bank provided 9.6 million yuan in green loans in a timely manner to support the transformation and upgrading of enterprises." Today, the company has become one of the largest manufacturers and exporters of bamboo and wood products in China.

Not only green loans, but under the guidance of green transformation policies, financial institutions have generally increased the innovation of financial products to provide high-quality financial services for the green transformation of the real economy.

Recently, Ai Jiexu showed that Glass (Shenzhen) Co., Ltd. opened a fixed deposit certificate account at ICBC Shenzhen Branch and successfully deposited the bank's first corporate green deposit. The person in charge of the company told reporters that the company's environmental, social and corporate governance (ESG) commitments coincide with the development concept of green finance of ICBC Shenzhen Branch. After the bank launched green deposits, the two parties quickly found new cooperation points.

"In addition to the characteristics of general time deposits, green deposits also have the specificity of raising funds, that is, they are specially used to support economic activities such as environmental improvement, climate change response, and resource conservation and utilization, providing more companies with ESG management needs. The choice of green financial products encourages companies to pay attention to social responsibility and sustainable development." Lan Linfeng, deputy general manager of the Credit and Investment Management Department of ICBC Shenzhen Branch, said that in addition to green deposits, the bank has also launched a series of green financial products such as sustainable development-linked loans, carbon reduction loans, and green bonds to meet the needs of different enterprises in the process of green development. Financing needs. Recently, the bank is exploring the use of blockchain technology to create an efficient and convenient online green deposit processing platform, realize easy-to-operate and traceable digital functions across the entire chain, and practice the green and low-carbon business concept.

"Currently, various green financial products are mushrooming." Dong Ximiao, chief researcher of the China Recruitment Alliance, believes that in the process of high-quality development of China's economy, it will continue to generate rich demand for green finance. Only by accelerating the pace of product and service innovation can financial institutions continue to meet the needs of economic and social development and accelerate their cultivation and improvement. Core competitiveness.

Optimize financial services and add green to the construction of ecological civilization

An ancient tree over 1000 years old has become an "insured person." This is a recent new incident in Qingchuan County, Sichuan Province.

Ancient and famous trees are considered to be "living cultural relics", and the protection of ancient and famous trees is an important part of the construction of ecological civilization. However, the restoration and rescue of ancient and famous trees often require a large amount of manpower and material resources, and insufficient funds have become the main factor restricting protection work.

Qingchuan County is rich in ancient and famous tree resources, ranging from 200 to 1210 years old. There are 101 ancient trees in the county that are 300 to 500 years old, and 66 trees over 500 years old. In order to assist in the protection of ancient and famous trees, Ping An Property and Casualty Insurance took nearly a year to conduct research, and finally signed an ancient and famous tree insurance agreement with the Qingchuan County Forestry Bureau, and launched a plan to insure 396 ancient trees in the county, with a total insurance amount exceeding 19.8 million yuan.

In recent years, financial institutions have thoroughly implemented the concept of green development and assisted in the construction of ecological civilization.

The construction industry is a "major carbon emitter" in my country and has a greater demand for green insurance. In March 2022, the Ministry of Housing and Urban-Rural Development issued the "14th Five-Year Plan for Building Energy Conservation and Green Building Development", proposing innovative credit and other green financial products to strengthen green insurance support.

In order to support the development of green buildings, Sunshine Property Insurance launched green building performance and building energy conservation and energy efficiency insurance. On June 26, 2023, Sunshine Property Insurance's first green building performance and building energy conservation and energy efficiency insurance was implemented in Zhejiang, providing two-star green building standard risk protection for 300,000 square meters of buildings in three real estate development companies in Hangzhou. After the completion of the project, if the application green building evaluation standard does not meet the two-star standard or deviates, Sunshine Property Insurance will provide green renovation compensation as agreed in the contract to ensure that the project finally meets the two-star standard and help achieve the green and low-carbon goal.

With the accelerated innovation of financial products and the improvement of the quality and efficiency of financial services, green financial services are increasingly participating in various fields of ecological civilization construction, continuing to promote the comprehensive green transformation of economic and social development.

In Qinghai, the People's Bank of China's Qinghai Province Branch, in conjunction with the Provincial Development and Reform Commission and the State Grid Qinghai Province Electric Power Company, has created the first carbon account financial service system in the country that can distinguish between meter data of green power and thermal power companies to calculate carbon emission reductions;

In Guangdong, Ping An Property and Casualty Insurance has implemented the country's first urban mangrove carbon sink index insurance to achieve effective coverage of ecosystem carbon sink protection;

In Xizang, the People's Bank of China's Tibet Autonomous Region Branch officially launched the first "personal carbon account" in border areas based on the Agricultural Bank's Palm Banking Platform in Lozha County to increase public enthusiasm for participating in green development;

In Zhejiang, China Pacific Insurance Zhejiang Branch and Anji Yucun jointly released the country's first "Green Water and Green Mountains-Zero Carbon Rural Comprehensive Insurance" to provide new innovative green insurance solutions for local zero-carbon rural construction;

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my country's green finance is accelerating its integration into the overall economic and social development. In April this year, the People's Bank of China took the lead in issuing the "Guiding Opinions on Further Strengthening Financial Support for Green and Low-Carbon Development" proposing that in the next five years, the internationally leading financial support for green and low-carbon development system will be basically established; By 2035, various economic and financial green and low-carbon policies will be promoted in a coordinated and efficient manner, the standard system and policy support system for financial support for green and low-carbon development will become more mature, and resource allocation, risk management and market pricing functions will be better utilized.

The People's Bank of China stated that the next step will be to coordinate support for green development and low-carbon transformation, give full play to the demonstration and leading role of carbon emission reduction support tools, continuously improve the green finance standard system, and steadily promote the high-quality development of green financial products and markets to improve the quality, efficiency and sustainability of green financial services.

(The original text is published in the People's Daily, October 3, 2024, page 05)