Belt and Road – Going Green

China has responded to calls for a more sustainable BRI.

As the developing world strives to meet the Paris Agreement target to limit global warming to below 2 degrees C, there is growing pressure on China to play its part in curbing greenhouse gas emissions.

This pressure will only grow as China emerges more decisively as the defacto leader of the Global South and many European Union countries such as Germany move back to reliance on coal in response to the ill-conceived sanctions imposed by the collective West – an act of self-harm and environmental vandalism undertaken at the behest of the US in its attempts to use Ukraine and NATO to undermine Russia.

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Last year, Chinese President Xi Jinping pledged that Beijing will not finance new coal-fired power projects abroad.

“China will step up support for other developing countries in developing green and low-carbon energy and will not build new coal-fired power projects abroad,” Xi said, in a video recording aired at the United Nations General Assembly. Crucially, China pledged to achieve carbon neutrality before 2060. This could move the needle on climate change action – while on a per capita basis China’s emissions are only half of those of the USA, China is the world’s biggest emitter of carbon dioxide, accounting for around 28 percent of global emissions.

In November 2021, the Chinese government announced a new commitment to accelerate and expand the development of green BRI projects. The resolution, released after the sixth plenary session of the 19th Central Committee of the Communist Party of China, noted that the BRI was “an initiative of peace, prosperity, openness, green development and innovation that brings different civilisations closer.”

In July 2021, the Guidelines for the Green Development of Foreign Investment Cooperation was launched to “encourage Chinese enterprises to adopt international or Chinese green standards where these are stronger than the host country standards. ”The publication, issued jointly by the Ministry of Commerce (MOFCOM) and the Ministry of Ecology and Environment (MEE), expects Chinese companies to view every project through the prism of sustainability and to follow international green rules and standards where local laws are insufficient.

Six months later, in January 2022, MEE and MOFCOM jointly issued the new ‘Guidelines for Ecological Environmental Protection of Foreign Investment Cooperation and Construction Projects,’ to align with these sustainable goals. The guidelines direct Chinese companies to carry out environmental impact assessments, share information on the project’s ecological and environmental protection with local stakeholders, and evaluate ecological damage, environmental pollution, environmental protection penalties, as well as environmental litigation, before carrying out mergers and acquisitions.

Some of the biggest projects announced last year were focused on accelerating the transition to green energy.

Ten-year Summary of BRI Progress

During the 2012 to 2021 period * Indonesia emerged as the top BRI destination in terms of number of BRI projects, hosting 108 projects. Russia was second with 86 projects, whilst Pakistan and Vietnam share third place with 79 projects each.. However, in terms of value, Russia topped the table with projects worth $221.07 billion.

* Although the BRI was officially launched in 2013, many China funded infrastructure project announced prior to the launch were subsequently classified as BRI projects. Hence the 10-year view (2012 to 2021) in the following tables.

TOP 10 BRI PROJECT NATIONS BASED ON NUMBER OF PROJECTS (2012 TO 2021)

TOP 10 BRI PROJECT NATIONS BASED ON PROJECT VALUE (2012 TO 2021)

The BRI’s focus on logistics, transport projects (railway, road, sea and airport projects) top the value table, with 697 projects valued at $819.52 billion.

However, the power sector saw the greatest number of projects announced, with 717 projects valued at $445.61 billion.

Leisure and property projects (focused on developing new smart cities) formed the third biggest BRI segment, with 661 projects valued at $342.98 billion.

TOP BRI SECTORS IN TERMS OF VALUE AND NUMBER OF PROJECTS (2012 TO 2021)

TOP BRI SECTORS IN TERMS OF VALUE AND NUMBER OF PROJECTS (2012 TO 2021)

China’s Global Development Initiative

In September 2021, Chinese President Xi Jinping proposed the Global Development Initiative (GDI) at the UN General Assembly,to accelerate the implementation of 2030 Sustainable Development Goals and promote global economic recovery in the postpandemic era.

The GDI’s eight priority areas are poverty reduction, food security, green transformation, clean energy, cooperation against the pandemic, industrialisation, digital economy and connectivity, according to multiple statements issued by Chinese ministries and government agencies.

Since its announcement, top Chinese government officials have spoken on the GDI’s priorities and approach in various domestic and international fora. China’s State Councillor and Foreign Minister Wang Yi told the Sustainable Development Forum in September 2021 that the GDI “will form synergy with other initiatives, including the Belt and Road Initiative, Agenda 2063 of the African Union, and
the New Partnership for Africa’s Development. It will build consensus and pool together the strengths of multilateral cooperation mechanisms such as the UN, the G20 and BRICS as well as various sub-regional and regional platforms.”

In fact, the GDI placed second in Wang’s nine-point speech at the Symposium on the International Situation and China’s Foreign Relations in 2021 conference, organised by China Institute of International Studies (CIIS) in December 2021. Whilst elaborating on how China had injected new impetus into economic recovery and created new opportunities for common development, Wang put GDI ahead of BRI, an indicator of the importance China attaches to the new initiative.

In January 2022, China’s permanent mission held a launch meeting for the Group of Friends of GDI in New York, where Zhang Jun, China’s permanent representative to the UN, reiterated that “the aim is to seek greater complementarity between the Initiative and the 2030 Agenda, support UN’s work in the field of development, and help developing countries fight the pandemic and implement the 2030 Agenda.”

The launch at the UN was attended by representatives from over 100 countries and more than 20 international organisations.

Source: Edited extract from Refinitiv, ‘BRI Infrastructure 360 Review’, January 2022.
https://www.refinitiv.com/content/dam/marketing/en_us/documents/reports/re1638498-cross-360-brochure.pdf