Text: | Print|

More funds to be available for green projects

2015-01-20 15:23 China Daily Web Editor: Qin Dexing

The China Banking Regulatory Commission issued a guideline on Monday to encourage greater allocation of bank loans to companies and industries involving in environmental protection, and energy-efficiency projects.

Ye Yanfei, an official at the CBRC, said that future projects that maximize and improve the utilization of energy and resources would be favored, as the country continues its war against serious pollution and environmental problems.

Ye said the regulator was also considering the launch of a "green" interbank bond, and asset-backed securities based on loans to green projects, to expand the amount of funding available to the sector.

The document outlined key areas and industries that would be eligible for green loans, including the traditional energy sector, and the construction and transportation sectors, both of which are facing problems related to energy inefficiency.

At the end of June last year the value of outstanding loans made to the country's environmental protection projects stood at 4.16 trillion yuan ($670 billion), accounting for 6.43 percent of total lending, according to CBRC.

China's environmental industry is growing at 15 percent annually with total output value expected to hit 4.5 trillion yuan.

China plansd to invest 2.37 trillion yuan in key projects aimed at improving energy efficiency within the 12th Five-Year Plan (2011-15), according to the National Development and Reform Commission.

Banks previously had little incentive to offer loans to green projects as they often involved high due diligence costs and greater risk, with companies in the energy-efficiency sector considered high technology with low assets and unstable cash flow.

Comments (0)
Most popular in 24h
  Archived Content
Media partners:

Copyright ©1999-2018 Chinanews.com. All rights reserved.
Reproduction in whole or in part without permission is prohibited.