PBOC Will Implement Climate Risk Stress Tests For Financial Stability: Journal

The PBOC will orderly carry out climate risk stress tests to respond to any financial stability issues, and improve the green financial system including the establishment of a carbon pricing mechanism, the Shanghai Securities Journal reported citing a speech by PBOC Deputy Governor Liu Guiping. China's coal-based energy and power structures are difficult to fundamentally change in the short term, so financial support cannot be simply withdrawn from the traditional sector too quickly, the newspaper cited Liu as saying. Financial institutions should continue to supply projects meeting the standards of reducing or substituting coal consumption, and seek the orderly exit of projects that fail to meet environmental requirements, said Liu.