Over the past decade, China has rapidly ascended the ranks to become one of the biggest players in cross-border investment. It invested $147 billion in foreign nations in 2022 alone. From 2013 to 2022, foreign infrastructure investments through China’s Belt and Road Initiative totaled $185 billion.

With funds for infrastructure already flowing, China and its investors are uniquely positioned to  help close the renewable energy financing gap in developing nations. Indeed, China has already committed to greening its overseas finance. To achieve this goal, stakeholders in China and host countries will need to work together closely to identify and support opportunities for low-carbon, climate-resilient development.

WRI Finance works with policymakers and financial institutions in China, as well as host country governments, to identify sustainable finance opportunities. Our goal is to increase the likelihood that Chinese finance will flow toward sustainable projects and away from unsustainable ones. We focus on analysis of Chinese finance flows and sustainable investment needs in developing countries, as well as building coalitions of key stakeholders.

To fulfill China’s reiterated commitment to greener overseas finance, China’s investment and capital flows should move away from traditional high-carbon projects. We envision China launching more stringent regulatory frameworks and finance mandates, which can prevent Chinese corporates and financial institutions from investing into coal and other unsustainable projects. Working with Chinese and international partners, we produce the China Overseas Finance Inventory for energy-sector investment to enhance data transparency.

We are a member of the BRI International Green Development Coalition, a coalition of international and Chinese organizations working across ten themes at the nexus of sustainability and development. Through the Green Belt and Road Initiative, we also proposed a traffic-light system for red-lighting coal and other unsustainable activities from Chinese investors. This system can help categorize investments and hopefully drive investment toward more sustainable projects and technologies.