The European Union and China plan to launch a system that could translate their green definitions to facilitate the flow of environment-focused funds amid enhanced cooperation in the field.
Ma Jun, chairman of the China Green Finance Committee, an organization within China's central bank, made the remark on Tuesday on the sidelines of a key annual UN climate change conference in Katowice, Poland, as his committee and the European Investment Bank jointly published a white paper on the need for a common language in green finance.
The work on the system, which could help Chinese and European markets to easily understand each other's green definitions, will start next year after the European Union unveils its green standard, disclosed Ma.
Without a translation system, companies have to get verification and certification from both sides if they would like to issue green bonds in each other's markets, resulting in high costs, said Ma in an interview with China Daily.
"The system could avoid the duplication and the high costs involved in that and also communication, which will promote the cross-border flow of green finance," he said.
He said his committee and the EIB established a joint green finance initiative to promote the translation work in 2017.
The duo also jointly drafted a white paper that provides an international comparison of several green bond standards on the margins of last year's UN climate talks in Bonn, Germany.
"Unless followed by actions, the Paris agreement will not amount to much," said Jonathan Taylor, vice-president of the EIB, addressing the publication ceremony of this year's white paper on Tuesday.
He said he was delighted that the two institutions have been working together for almost two years. "This cooperation serves the broader multilateral agenda well."
"Mainstream capital markets mobilize huge amounts of funds. But while liquidity is abundant, there is no universal understanding in climate finance. This understanding, in turn, is key to defining joint goals and developing concerted actions," he noted.
Ma also pointed to the growing cooperation between China and European countries. The Central Banks and Supervisors Network on Greening the Financial System, jointly initiated in late 2017 by the central banks of eight countries, including Bank of France, the People's Bank of China, and Dutch central bank De Nederlandsche Bank, is one of the examples.
"Only one year after the system was initiated, it has expanded to include 21 countries," said Ma, "It's highly potential that it will become a powerful international organization in promoting the development of green finance."
China and France have initiated a joint conference on green finance this year. His committee and Green Finance Initiative, the City of London Corp also launched a China-UK green finance center to promote the two countries' cooperation on green finance, Ma said.