BELT & ROAD, or how China Plans to Conquer the world - economically!

The City of London Corporation is helping to bring together some of the world’s biggest banks in Beijing to discuss for the first time implementation of Green Investment Principles (GIPs) for the Belt and Road, announced in London in November last year.



The Belt and Road Initiative (BRI, or B&R), formerly known as One Belt One Road (Chinese: 一带一路) or OBOR for short, is a global infrastructure development strategy adopted by the Chinese government in 2013 to invest in nearly 70 countries and international organisations.

It is considered a centrepiece of the Chinese leader Xi Jinping's foreign policy. The BRI forms a central component of Xi's "Major Country Diplomacy" (Chinese: 大国外交) strategy, which calls for China to assume a greater leadership role for global affairs in accordance with its rising power and status.


The Bank of China, Standard Chartered, HSBC, China Development Bank and more than twenty other banks and financial institutions (*full list below) are among the signatories and will be among those attending the meeting, which will see all signatories and supporters share knowledge on green investment and best practices.


The GIPs were launched at the Belt and Road Forum in April, with the overall aim of factoring environmental risk and climate resilience into infrastructure projects.

They were welcomed by the UK and Chinese governments in the policy outcome paper at the 10th UK-China Economic and Financial Dialogue.


This came as a result of work delivered by the UK-China Green Finance Centre, supported by the Green Finance Institute and China’s Green Finance Committee.

Sir Roger Gifford, Chair of the Green Finance Institute and Co-Chair of the UK-China Green Finance Centre, said:

“I am excited to be attending the first plenary meeting of the Green Investment Principles, the first of their kind and a potential game-changer in mitigating the potential environmental impact of the Belt and Road Initiative.

“With the collaboration of our Chinese partners through the UK-China Green Finance Centre, we are playing a fundamental role in ensuring that one of the biggest infrastructure projects in history incorporates low-carbon and sustainable development.

“I am confident that this first meeting will together put us firmly on the path toward achieving that key objective.”


The City of London Corporation is the governing body of the Square Mile dedicated to a vibrant and thriving City, supporting a diverse and sustainable London within a globally-successful UK. www.cityoflondon.gov.uk


LIST OF SIGNATORIES

  • Agricultural Bank of China

  • Agricultural Development Bank of China

  • Al Hilal Bank

  • Ant Financial Services Group

  • Astana International Exchange

  • Bank of China

  • Bank of East Asia

  • BMCE Bank of Africa

  • China Construction Bank

  • China Development Bank

  • China International Capital Corporation

  • China International Contractors Association

  • Credit Agricole-CIB

  • DBS Bank

  • Deutsche Bank

  • Export-Import Bank of China

  • First Abu Dhabi Bank

  • Habib Bank

  • Hong Kong Exchanges and Clearing Limited

  • HSBC

  • Khan Bank

  • Industrial and Commercial Bank of China

  • Industrial Bank

  • Luxemburg Stock Exchange

  • Mizuho Bank

  • Natixis Bank

  • Silk Road Fund

  • Standard Chartered Bank

  • Trade & Development Bank of Mongolia

  • UBS

GREEN INVESTMENT PRINCIPLES FOR THE BELT AND ROAD

Principle 1: Embedding sustainability into corporate governance

We will embed sustainability into our corporate strategy and organisational culture. Our boards and senior management will exercise oversight of sustainability-related risks and opportunities, set up robust systems, designate competent personnel, and maintain acute awareness of potential impacts of our investments and operations on climate, environment and society in the B&R region.

Principle 2: Understanding Environmental, Social and Governance Risks

We will strive to better understand the environmental laws, regulations, and standards of the business sectors in which we operate as well as the cultural and social norms of our host countries. We will incorporate environmental, social and governance (ESG) risk factors into our decision making processes, conduct in-depth environmental and social due diligence, and develop risk mitigation and management plans, with the help of independent third-party service providers, when appropriate.

Principle 3: Disclosing environmental information

We will conduct analysis of the environmental impact of our investments and operations, which should cover energy consumption, greenhouse gas (GHG) emissions, pollutants discharge, water use and deforestation, and explore ways to conduct environmental stress test of investment decisions. We will continually improve our environmental/ climate information disclosure and do our best to practice the recommendations of the Task Force on climate-related Financial Disclosure.

Principle 4: Enhancing communication with stakeholders

We will institute stakeholder information sharing mechanism to improve communication with stakeholders, such as government departments, environmental protection organizations, the media, affected communities and civil society organizations, and set up conflict resolution mechanism to resolve disputes with communities, suppliers and clients in a timely and appropriate manner.

Principle 5: Utilizing green financial instruments

We will more actively utilize green financial instruments, such as green bonds, green asset backed securities (ABS), Yield Co, emission rights based financing, and green investment funds, in financing green projects. We will also actively explore the utilisation of green insurance, such as environmental liability insurance and catastrophe insurance, to mitigate environmental risks in our operations.

Principle 6: Adopting green supply chain management

We will integrate ESG factors into supply chain management and utilize international best practices such as life cycle accounting on GHG emissions and water use, supplier whitelists, performance indices, information disclosure and data sharing, in our investment, procurement and operations.

Principle 7: Building capacity through collective action

We will allocate funds and designate personnel to proactively work with multilateral organizations, research institutions, and think tanks to develop our organizational capacity in policy implementation, system design, instruments development and other areas covered in these principles.


Brief history of Belt & Road planning sessions


2019

15 Aug 2019

Global banks meet in China for first Green Investment Principles plenary meeting


24 Apr 2019

Green Belt and Road principles receive industry backing


23 Apr 2019

City of London Corporation Policy Chair to explore partnership opportunities at Belt and Road Forum in Beijing

2018

30 Nov 2018

City of London Corporation works with China to green the Belt and Road Initiative


13 Jun 2018

City Corporation puts London on the Belt and Road map


18 Jan 2018

Lord Mayor Charles Bowman speech at the CCCUK China-UK Economic and Trade Cooperation event

2017 18 Dec 2017

London and Hong Kong boost cooperation in Belt and Road


01Nov 2017

Green Finance report says sector is ready to scale up


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