China to invest in clean energy along ‘Silk Road’ economic belt with first-of-its-kind fund

Clare Saxon Ghauri
Reading time: 4 minutes
12 March 2015

BEIJING: The first-ever private equity fund to boost clean energy, environmental improvements and green jobs around China’s ‘Silk Road Economic Belt’ region was initiated this week, at an event strategically supported by The Climate Group.

The concept of China’s Silk Road Economic Belt is named after the ancient trading routes linking Europe, Asia and the Middle East, and was first proposed by Chinese President Xi Jinping last September to improve economic cooperation between the regions.

As well as funding environmental projects to counter the worsening desertification and drought problems that China and other countries along the Belt are experiencing, the Green Ecological Silk Road Investment Fund will also back projects to increase clean energy such as solar.

As we near the close of the annual National People's Congress in Beijing, Changhua Wu, Greater China Director, The Climate Group explains why the fund is so important: "I am delighted to see the fund take off. Launched in the middle of the National People's Congress, the fund echoes kind and clear to President Xi's Belt and Road Strategy, but adds a key green signpost. This is also a strong low carbon declaration by a group of private sector business leaders to society and the international community to lead China's clean revolution."

"The Climate Group will lend strategic support and advice to the fund together with other international organizations. I hope more capital and project partners from around the world will join the league to advance our commitment to tackle climate change."

With a first round investment of 30 billion yuan (US$4.8 billion), the fund was launched by several top enterprises in China, including Elion Resources, China Oceanwide, Chint Group, Huiyuan Juice, Macrolink, JuneYao, Ping’an Bank and Sino-Singapore Tianjin Eco-city. The Climate Group is international strategic partner along with UNEP, UNCCD, IUCN and UNIDO.

For its first project, the fund will use 5 billion yuan (US$790 million) in investment capital to establish an ecological solar panel industrial chain in the corridor between Beijing and the city of Zhangjiakou in China’s Hebei Province.

Wang Wenbiao, chairman of Elion Resources, says the fund offers an important economic opportunity to green the Belt, according to China state media: “Utilizing the PPP [public-private partnership] mode, we are willing to promote green investment along the Belt. Some experts say that energy and environmental fields will be top priorities of the Belt. It’s estimated that over US$5 trillion will be injected into the energy sector by China in the next 10 years.”

During the launch event, fund manager Liu Guochen said the fund will create over 100 billion yuan (US$16 billion) in investment value as well as provide 200,000 green jobs over the next six to eight years.

Monique Barbut, Executive Secretary of the U.N. Convention to Combat Desertification commented: “The success of the Green Ecological Silk Road Investment Fund would demonstrate land degradation neutrality is an achievable, measurable and compelling goal the world can get behind. At the same time, it would also be trail-brazing example of the power of collective action by and determination of like-minded people towards achieving the Sustainable Development Goals.”

Join Changhua Wu on Twitter on March 16 at 11.30am London time/7.20pm Beijing time to talk about the National People's Congress and China's low carbon leadership. Ask your questions using #CleanRevolution and follow us @ClimateGroup and @ChanghuaWu.


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By Clare Saxon Ghauri and Jing Wang

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