Chinese Governmental Policies and Institutions: Tendency to Internationalize Investment to Develop Infrastructure for Renewable Energy

2. College of Architecture and Urban Planning, Huazhong University of Science and Technology, China

Abstract: Energy is crucial for a state survival and an economic development and China has created a set of institutions to address this financial need including NDB/BRICS, AIIB/OBOR, and it is allied with specific polices to invest in infrastructure and deeply connect its economy to world economy, as expressed by Xi Jinping’s speech at 19th Congress of CCP and at APEC CEO Summit. Concerning the objective of Paris agreement, to answer the combatting mechanism to global warming, the Chinese government understands that they can help to di-risk investment on the new technologies. In harmony with world financial system, which after 2008 economic crisis took a new turn on the way to finance infrastructure, as “Basel 3” and “Solvency 2” that inadvertently limit the ability of institutions like banks and insurance companies to finance long-term infrastructure investments, laying the foundation for a low-carbon future. There is policy obstacle embedded in the financial system and regulations that hamper the supply on long-term finance for instance, the great financial crisis has led to the changes in financial stability rules. This change redefines the matrix of the development in a sense which dictates a tendency beyond time but also size as a collateral effect mostly renewable energy apart from hydroelectric and nuclear energy. What governments will need to understand and correct is the consequences of policy designs and we also need to consider a financial system that ignores climate risk may not end up being stable either.