Wang YeandChristoph Nedopil Wang

How red-flagging coal can help align belt and road projects with China’s climate ambitions

More transparency in managing belt and road projects’ environmental risks could address concerns of China’s overseas presence in coal and other projects, laying the foundation for greener, more sustainable development

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Labourers unload coal from a cargo ship in Gabtoli on the outskirts of Dhaka, Bangladesh, on November 6, 2019. Developing countries such as Bangladesh are reducing their dependence on coal, raising the importance of environmental considerations in infrastructure investment. Photo: AFP

Wang YeandChristoph Nedopil Wang

Published: 3:45pm, 9 Dec 2020Updated: 10:15pm, 9 Dec 2020

In 2020, as most of the world’s economies have struggled with the impacts of the coronavirus pandemic, China’s investments into countries in the Belt and Road Initiative (BRI) have grown in value by 30 per cent, according to Ministry of Commerce statistics. Investments include transport, health, mining and more.

In the five years since the initiative’s inception, one sector has remained steadfast in China’s ever-growing stream of outward investments: energy.

With the energy sector central to the future of global emissions, these investments have also, however, raised concerns amid the global call for a green recovery. As the world wakes up to the urgent threats of climate change and biodiversity loss, China’s continuing support of coal power in its belt and road project portfolio is being put under ever more scrutiny.

According to Boston University’s China’s Global Power Database, Chinese invested in 23.4 gigawatts worth of coal power plant capacity in overseas markets from 2002 to 2017, accounting for 30 per cent of total investment in overseas power plants.

With Japanese and Korean financial institutions and policymakers increasingly placing restrictions on overseas coal investments, China is fast becoming the world’s final major coal power developer.

Such an unenviable label goes against President Xi Jinping’s bold pledge for China to realise carbon neutrality by 2060, which has triggered a flurry of decarbonisation plans and climate pledges, as well as his repeated calls for the belt and road to be coloured green.