China’s pledge to cut overseas coal funding game-changer?
BEIJING, Sept 22: China's pledge to stop funding overseas coal has been welcomed as a climate landmark that could dry up funding for smoke-billowing plants in poor countries.
But the world's top polluter has not set out a timeline for when it will take effect, and it is not clear whether funders will be forced to pull the plug on projects under construction or in planning.
China on Tuesday said it will stop providing funding for coal projects overseas. "China will step up support for other developing countries in developing green and low carbon energy and will not build new coal-fired power projects abroad," President Xi Jinping told the United Nations General Assembly.
China is the biggest public funder of overseas coal plants and its shift is symbolic. Both Japan and South Korea -- the two other biggest state funders -- have said they will stop funding projects by year end.
"China was the last man
standing on this front," said Li Shuo, a climate analyst for Greenpeace China. It is hoped the move will discourage China's private players from investing. "When public money goes somewhere, private money tends to follow," Li added.
But China's overseas coal footprint is small in real terms. A total of 13 percent of the money going into coal plants worldwide between 2013 and mid-2019 came from China, according to Boston University's Global Development Policy Center.
This means recent China-funded coal projects in Africa, Asia, Latin America and even parts of Eastern Europe will only generate about 53 gigawatts (GW) -- a fraction of the 1,188 GW global coal pipeline according to advocacy movement Endcoal.
About 87 percent of total funding for coal plants in developing nations come from entities outside China. Private banks and institutional investors from Japan, the US and the UK bankroll a bulk of the coal projects in the developing world. -AFP