China mulls policies to encourage green finance development

BEIJING - China is mulling more ways to encourage banks and private capital to invest in green finance projects, a deputy central bank governor said Friday.

Developing green finance is a global trend and a necessary choice for China's sustainable growth as well as a major move to honor the country's commitment to the Paris Agreement, according to Chen Yulu, deputy governor of the People's Bank of China (PBOC).

Development of green finance is gaining steam in China, but still in the early stages, Chen said.

The State Council, China's Cabinet, Wednesday announced its decision to set up pilot zones in Guangdong, Guizhou, Jiangxi and Zhejiang provinces and Xinjiang Uygur autonomous region to boost green finance development.

The central bank will roll out more incentive policies in pilot regions, such as including a green credit review in the Macro Prudential Assessment for deposit financial institutions and promoting sustainable business practices among private investors.

The PBOC will also develop more green finance products, expand financing channels, roll out industrial standards and set up green credit mechanism, according to Chen.

The cost of green projects will be gradually reduced and profit increased thanks to rising awareness and an improving green finance mechanism, Chen added.