MNI BRIEF: China Should Set Up National Green Fund

China should establish a national-level fund to help with the green transformation, so to minimize possible contagion to the financial sector as many high-carbon industries and enterprises will face severe pressures amid the green push, according to a report by the Green Finance Committee of China Society for Finance and Banking sent to MNI.

The central government should set up a national-level fund to provide financing support for key industries and key regions that require low-carbon transformation, and new financial products such as transformation M&A funds, loans, bonds and guarantees, as well as debt-to-equity swaps should be developed.

Local governments and regulators should offer land for renewable energy development, subsidies, tax reliefs, guarantees and financial tools to support carbon emissions, the report said. Overall, China will need an accumulated CNY48.7 trillion of green investment in the next 30 years so to achieve the goal of carbon-neutrality before 2060, according to the report.