This year’s London Climate Action Week had its limelight stolen on the opening day, when UK Prime Minister Keir Starmer announced his resignation, dominating the headlines.
Starmer has been good for UK-China relations. In late January, he paid a state visit to Beijing and Shanghai. There the two countries agreed to set up a High-Level Climate and Nature Partnership and to hold the first meeting of the UK-China Financial Working Group.
They also agreed to hold the 12th UK-China Economic and Financial Dialogue (EFD) by the end of the year. The EFD process often brings progress on green finance. The last instalment, in January 2025, led to ten policy outcomes on green and biodiversity finance. One of these led to China’s issuing its first-ever green sovereign bonds, in London in April.
Will Starmer’s resignation leave a question mark hanging over cooperation between the two countries on green finance? London Climate Action Week seems to suggest the answer is “no”.
The UK-China Green Finance Taskforce
On 25 June, the London Stock Exchange welcomed the UK-China Green Finance Taskforce to a climate investment summit. A partnership between the UK and Chinese financial sectors, the taskforce was launched in 2017 by the City of London and the China Green Finance Committee.
Two outcomes of two UK-China projects were also announced. First was the publication of a report on transition finance and the green economy. It analysed progress and regulatory frameworks on corporate climate disclosures, transition planning and green bond markets across the two countries. The report also suggested further opportunities for cooperation on “interoperability” – making green finance standards more compatible across markets – as well as sharing disclosure data, and industrial decarbonisation finance.
Ma Jun, co-chair of the taskforce, told Dialogue Earth that it had formed a subgroup – “the transition finance workstream” – in June last year. That group has 29 member organisations from the UK and China working on standards, the drafting and assessment of corporate transition plans, and exploring suitable financing solutions. For example, as the UK has more experience in decarbonising buildings, the taskforce is considering a building decarbonisation project in Beijing’s business district.
The second announcement was of the FTSE CCB Dim Sum Green Bond Index, a joint undertaking by FTSE Russell, an index provider subsidiary of the London Stock Exchange, and the China Construction Bank. The new index will help international investors track the prices of offshore RMB-denominated green bonds, also known as dim sum bonds.
| Type | Definition |
| Bond | A bond is a special kind of loan that a borrower issues to an investor. It includes regular interest payments and the return of the borrowed money at a specified time. |
| Green bonds | Governments, companies or banks issue these bonds to raise money for green projects such as wind farms and water treatment facilities. Investors may accept slightly lower returns in return for a positive environmental impact. |
| Sovereign bonds | Sovereign bonds are issued by governments to raise funds for many things including infrastructure, public services and debt refinancing. |
| Green sovereign bonds | These are sovereign bonds designed to raise money for green projects. |
| Dim sum bonds | RMB-denominated bonds issued outside mainland China, mainly in Hong Kong, by Chinese or overseas institutions. |
| Green dim sum bonds | Dim sum bonds, but issued for green projects. |
One index industry professional told Dialogue Earth that the publication of such data increases market transparency and investability. This could attract more international investment to offshore RMB-denominated green bonds and so support for green projects and the development of green finance markets, they said.
In an interview livestreamed from the stock exchange, Sir Charles Bowman, co-chair of the UK-China Green Finance Taskforce, admitted that the taskforce’s 2017 founding had come towards the end of a “golden era” of UK-China relations. There has been a certain cooling off since then but the taskforce had successfully sustained “business to business engagement”, he said.
He added that over the last two years relations have started to improve again, with Starmer’s January state visit to China a high point.
Ma Jun, meanwhile, described green finance as a very “depoliticised” part of UK-China cooperation, with the taskforce achieving real results since its founding in 2017.
Seeking common ground despite differences
Dialogue Earth has attended London Climate Action Week three years in a row. In the past, few Chinese organisations attended and those that did rarely held events. This year was different. Lawrence Iu, executive director of Civic Exchange, a Hong Kong public-policy think-tank, said that with the US cooling on climate topics, London’s climate week has become more influential. This has also been helped by how China’s 15th five-year economic plan (2026-2030) has raised expectations of stable transition policies, he said.
One of the events held in London was the UN Environment Programme Finance Initiative’s (UNEP FI) 19th Global Roundtable on Sustainable Finance. Thirty Chinese banks have signed up to the initiative’s Principles for Responsible Banking, more than from any other nation. Dialogue Earth spoke with Guo Peiyuan, UNEP FI’s China representative and chair of the China Sustainable Investment Forum. He said a delegation from nine Chinese banks attended London’s climate week this year, taking the opportunity to visit various international organisations and discuss sustainable investment, information disclosure and sustainable bonds.
“Visiting London lets people get a better feeling for how Europe and the US are talking about climate issues,” Guo said. While the EU’s overall targets haven’t changed, he said, there has been some relaxing of specific industrial policies, such as on the phase-out of petrol and diesel cars, and businesses are quietly changing what they do. “Behind closed doors, big companies are starting to talk about how they might change climate targets, as factors like AI use and energy prices mean the existing targets will be hard to reach,” he said.
“In comparison, China’s banks and businesses are pressing steadily on with low-carbon transition work. Some have set targets but not necessarily made those public, so there is little basis for discussing whether they need to be adjusted.” Guo thinks the opportunity for full discussion of variations across policy and industrial strategy will have helped mutual understanding and the finding of common ground despite differences.
From UK-China to the world
London Climate Action Week has become an occasion of global significance, with over a thousand different activities. These included policy discussions, exchanges on investment practices, corporate showcases, and NGO events.
Participation by Chinese organisations reflects their expanding engagement with UK partners and global climate discussions, Dialogue Earth notes.
Guo Peiyuan thinks the successes of UK-China cooperation, including on interoperability and partnerships between banks, could provide a model for other bilateral cooperation. “Current geopolitical circumstances mean united global action is increasingly challenging. There’s a real need to look more at regional and bilateral cooperation,” he said. His team is working to build links between Chinese financial institutions and those in Brazil, among other countries.
Ma Jun and Lawrence Iu both said China and the UK could join forces to promote transitions in the Global South.
Two and a half years ago, Ma Jun founded the Capacity-building Alliance of Sustainable Investment (CASI). He told Dialogue Earth that CASI aims to provide sustainable finance training for 100,000 learners globally and has so far reached more than 100 countries and regions. “The UK is a world-leader in the green finance field; about 20 of CASI’s 74 member organisations are from the UK or have close links with the country,” he said.
Lawrence Iu said Hong Kong is an important bridge between China and the UK, able to link UK and EU standards with China’s advanced technology, and then promote that combination in the Global South.
“Although the change of prime minister may slow things a bit, green cooperation between China and the UK should remain stable up until the 2029 UK elections,” Iu said. “We’re looking forward to this partnership benefiting the global transition.”
