{"id":36212,"date":"2019-04-24T10:40:00","date_gmt":"2019-04-24T10:40:00","guid":{"rendered":""},"modified":"2020-11-17T11:46:34","modified_gmt":"2020-11-17T11:46:34","slug":"11212-green-belt-and-road-in-the-spotlight","status":"publish","type":"post","link":"https:\/\/dialogue.earth\/en\/energy\/11212-green-belt-and-road-in-the-spotlight\/","title":{"rendered":"\u2018Green Belt and Road\u2019 in the spotlight"},"content":{"rendered":"\n

\u201cPromote Belt and Road cooperation for high-quality development\u201d read welcome banners for the second Belt and Road Forum flying over Beijing\u2019s boulevards. The forum, running from 25-27 April, will convene 37 heads of state<\/a> to discuss China\u2019s flagship global infrastructure plan.<\/p>\n\n\n\n

This year\u2019s forum will be larger and higher level<\/a> than the inaugural gathering in 2017. But recent complaints about the financial and environmental sustainability of the Belt and Road Initiative (BRI) have sent tremors through it, and lending has slowed<\/a>. As the \u201chigh-quality development<\/a>\u201d rebranding suggests, the forum will likely aim to assuage the \u201copposition, misunderstanding and distortion\u201d of critics, according to Wang Xiaoquan<\/a>, secretary general of the Chinese Academy of Social Sciences\u2019 Belt and Road Research Centre.<\/p>\n\n\n\n

President Xi Jinping and high-level ministries have championed China\u2019s commitment to green development along the Belt and Road. However, environmental governance has lagged behind rapid project development. Will this year\u2019s forum provide an opening for reform?  <\/p>\n\n\n\n

\u2018Green Belt and Road\u2019 at the forum<\/h2>\n\n\n\n

Participants this year will have an unprecedented opportunity to weigh in on the initiative\u2019s environmental responsibilities. On 25 April the Ministry of Ecology and Environment (MEE) and the National Development and Reform Commission (NDRC) will host a sub-forum dedicated to building a \u201cgreen Belt and Road\u201d and aligning it with the UN\u2019s Sustainable Development Goals<\/a>. About 200 guests, including representatives from the environmental ministries of participating countries, NGOs, international organisations and businesses, have been invited to attend the sub-forum of speeches and panels.<\/p>\n\n\n\n

\u201cDelegates will be invited to share their views on green development of the Belt and Road,\u201d stated a note sent to participants. The event\u2019s tight half-day agenda will allow little time for in-depth feedback; nonetheless, it will be a new platform for dialogue between the Chinese government and other Belt and Road parties.<\/p>\n\n\n\n

\u2018Green Belt and Road\u2019: What\u2019s at stake?\u00a0<\/p>

91%<\/a> <\/strong>of energy-sector loans to BRI countries went to the fossil fuel industry in 2014-2017.<\/span><\/p>

China has committed or proposed to finance one-quarter<\/strong><\/a> of the coal plants under development outside the country.<\/p>

BRI countries, not including China, account for 26%<\/a><\/strong> of global CO2 emissions. That could grow to 50% by 2050 in the worst-case scenario.<\/p><\/div><\/div>\n\n\n\n

A launch expected at the forum will also be a step toward greater inclusivity. In his speech at the 2017 forum<\/a>, President Xi called for the creation of an International Green Development Coalition on the Belt and Road. The MEE and the United Nations Environment Programme (UNEP) have worked together<\/a> to establish this coalition, and it is due to be officially unveiled on 25 April.<\/p>\n\n\n\n

Dimitri de Boer, chief representative of ClientEarth in China, one of the new coalition\u2019s partners, said: \u201cThe fact that the Ministry of Ecology and Environment moved forward with the UN Environment on establishing this Belt and Road coalition \u2013 it shows that there is a genuine follow-up.\u201d<\/p>\n\n\n\n

In total, the coalition has over 120 partners, roughly half of which are Chinese and half international. These partners include environmental ministries, academic institutes, international organisations and businesses. According to a pamphlet on the coalition, it has identified 10 areas within which partners will work together to conduct research, develop projects and formulate policy recommendations. These include climate change, biodiversity and green finance. Work plans will be discussed at a side event, according to documents sent to participants.<\/p>\n\n\n\n

The coalition is not without controversy. Last year, UNEP chief Erik Solheim resigned amidst reports about his excessive travel and spending<\/a>. The Guardian also reported that his staff had criticised the Belt and Road coalition and his perceived closeness to China.  Given the politics surrounding it, the extent to which the coalition will be a platform for substantive policy dialogue and input remains to be seen.<\/p>\n\n\n\n

Revisiting China\u2019s vision of a \u2018green Belt and Road\u2019<\/h2>\n\n\n\n

Due to its broadness, the concept of a \u201cgreen Belt and Road\u201d, like the initiative itself, has become something of a Rorschach test, eliciting diverse views on China\u2019s responsibilities.<\/p>\n\n\n\n

Right before the first Belt and Road Forum in 2017, the Chinese government outlined its own vision in the \u201cGuidance on Promoting a Green Belt and Road<\/a>\u201d, a sweeping manifesto for sustainable development within the initiative. It was published by four ministries central to the Belt and Road: the NDRC, the Ministry of Foreign Affairs, the Ministry of Commerce and the MEE\u2019s predecessor, the Ministry of Environmental Protection (MEP).<\/p>\n\n\n\n

The guidance is scant on policy details. However, alongside a companion plan from the MEE<\/a>, it sheds some light on the government\u2019s approach. Ren Peng, manager of the Overseas Investment, Trade and the Environment Program at the Global Environmental Institute said: \u201cMEE\u2019s principles are important, at the national level it sends a signal: the central and provincial governments are paying attention to the issue.\u201d<\/p>\n\n\n\n

At its outset, the document sets a timeline for laying \u201ca solid foundation for a green BRI within three to five years\u201d.<\/p>\n\n\n\n

As for what a \u201cgreen Belt and Road\u201d might look like, the guidance encourages companies operating overseas to observe local environmental laws while also calling on them to adopt higher environmental standards. It acknowledges the economic logic of companies pursuing green development, stating that environmentally friendly standards will \u201cenhance their green competitive edge to lead green development\u201d. As for green finance, it proposes the creation of policies to prevent ecological risks from project investments. It also advocates for the creation of green banks and the use of China’s policy banks, which are tasked with carrying out government policy, to actively channel funds to green projects.<\/p>\n\n\n\n

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A welcome banner for the Belt and Road Forum in Beijing\u00a0(Image: Lili Pike)<\/div><\/div><\/div><\/div>\n\n\n\n

However, so far the government has not established binding environmental standards for banks or companies operating overseas. A compliance mechanism is lacking, according to Bai Yunwen, executive director of Greenovation Hub. \u201cIf a company doesn\u2019t abide by [the guidance], what punishment will they receive? The guidance doesn\u2019t say,\u201d she said.<\/p>\n\n\n\n

In projects undertaken by Chinese state-owned enterprises and banks, environmental impacts and violations of local laws have sparked protests and led to lawsuits. A Chinese-funded coal plant in Lamu, Kenya<\/a> and rail and port projects in Sri Lanka<\/a> have been sites of such controversies.<\/p>\n\n\n\n

Others note the guidance\u2019s failure to emphasise certain priority areas like climate change. Simon Zadek, a visiting fellow at Tsinghua University\u2019s Centre for Finance and Development, told chinadialogue<\/em>: \u201cThe \u2018greening the Belt and Road\u2019 story suffers from a lack of specificity: number one, an enforcement mechanism, and two, a lack of real will by China to address the particular and long-term challenge of climate change as it relates to the Belt and Road.\u201d<\/p>\n\n\n\n

The government\u2019s progress report<\/a> on the Belt and Road, released this week, vows to uphold the Paris Agreement at the same time it acknowledges cooperation on coal projects as part of the initiative\u2019s achievement to date. Coal projects have dominated<\/a> China\u2019s Belt and Road power sector lending and accounted<\/a> for the largest share (42%)<\/a> of China\u2019s policy banks\u2019 overseas energy finance in 2018.<\/p>\n\n\n\n

In a recent interview<\/a> with chinadialogue, <\/em>Nicholas Stern, former chief economist of the World Bank said: \u201cI feel that there is a split between the ideas behind the Belt and Road Initiative and what has actually been financed under the initiative. It would be good if China\u2019s Belt and Road financing can get closer to the idea and to the great changes that are happening inside the country.\u201d<\/p>\n\n\n\n

Specific policies needed<\/h2>\n\n\n\n

The Chinese government has presented the Belt and Road as an open, multilateral platform, but its projects have been almost entirely funded by China\u2019s state-owned banks and enterprises, according to a 2018 study<\/a> by the Industrial and Commercial Bank of China and Oxford Economics. Because the main entities involved are state owned not private, the central government has unique power to shape the Belt and Road\u2019s development through its environmental policies.<\/p>\n\n\n\n