Xinjiang
Last year, China’s State Council designated five regions where the central government will work with local authorities to build green finance reform and innovation pilot areas; Xinjiang in western China stands out among these.
In only a year, authorities in Xinjiang – which is famous for its natural environment, as well as its ethnic diversity – have begun building the nation’s first green experimental library. Local authorities have worked with financial institutions to issue Rmb35 billion ($5.5 billion) of green bonds to fund various initiatives, including green policy research think tanks to attract more talent to the region and help with its environmental development.
The local government in Urumqi, the provincial capital, has also begun setting up local green financial reform and innovation pilot zones in Hami City, Changji Prefecture and Karamay City. All three are home to large ethnic Uighur Muslim, or Hui, communities who have at times felt economically left behind.
In January alone, officials in Xinjiang worked with local enterprises – 14 financial institutions and 42 companies – to arrange for 13 cooperation agreements on green projects with a total contract value of nearly Rmb9 billion.
Local authorities are exploring the possibility of setting up a local green bank. They also signed a strategic cooperation agreement with Industrial Bank worth Rmb50 billion to fund the various zones and have signed an agreement with the Manila-based, Japanese-led Asian Development Bank for a $150 million loan to finance green infrastructure in Changji prefecture.
According to local authorities, as of the end of 2017, the balance of green credit in the three pilot areas was Rmb35 billion, accounting for 11.6% of total loans in the three regions.
The loans are concentrated on renewable energy and clean energy, green transportation and natural habitat protection, ecological restoration, and disaster prevention and control projects.