China ranks first in world in terms of outstanding green loans

China's outstanding green loans in yuan and foreign currencies hit 15.9 trillion yuan (about $2.5 trillion) by the end of 2021, the largest in the world and jumping 33 percent from the previous year, according to the People's Bank of China (PBOC).

A woman works at a green workshop of Hubei Asa Ceramics in Tongcheng county, central China's Hubei province, March 2, 2022. [People's Daily Online/Liu Jianping]

The country issued 600 billion yuan worth of green bonds domestically last year, up 180 percent year on year, with outstanding green bonds reaching 1.1 trillion yuan.

Last year, the PBOC launched two new structural monetary policy instruments to encourage society to invest more in the field of green and low carbon development.

One of them is a carbon-reduction supporting facility which supports, in a well-ordered and targeted manner, the development of clean energy, energy conservation and carbon reduction technology -- three major areas of carbon reduction. It aims to draw more social capital into the promotion of carbon reduction.

Photo taken on Feb. 26, 2022 shows wind turbines in Zhongtiao Mountain, Ruicheng county, Yuncheng, north China's Shanxi province. [People's Daily Online/Xue Jun]

The other is a special re-lending facility that supports the clean and efficient use of coal. The facility supports enterprises engaged in massive production of clean energy, application of clean combustion technologies, as well as other five sectors.

These two instruments will continue encouraging the clean and efficient use of coal and coal power while developing clean energy.

Using the new monetary policy instruments, the PBOC will provide a certain part of eligible loans for carbon-emission cuts, with a one-year lending rate of 1.75 percent, the most preferential rate offered by the PBOC.

A 110MW fishery and photovoltaic complementary project is being built in Xilian township, Yi'an district, Tongling, east China's Anhui province, March 7, 2022. [People's Daily Online/Chen Chen]

So far, the PBOC has issued loans of 230.8 billion yuan and 13.4 billion yuan under the two instruments, respectively. In particular, the first instrument has helped reduce 47.86 million metric tons of carbon dioxide in the past year.

The PBOC said that China has preliminarily built a multi-level green financing product and market system that includes green loans, green bonds, green insurance, green funds, green trust services and carbon finance products.