ANNUAL REPORT

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billion of global green bonds issued in that period. 78 It remains unclear,
however, who buys these bonds.
Attracting additional funding requires greater transparency and
clarity on the legal and regulatory frameworks governing PPPs and
green financing, and further opening of the financial sector to global
investors. 79 Green bonds are largely self-labeled by the issuer. 80
For example, the China Green Bond Index permits fossil fuel investments
such as clean coal, while the voluntary 2016 Green Bond
Principles, supported by 117 institutions (including one Chinese institution,
the Agricultural Bank of China), do not. 81 In light of
these differing definitions and practices, global investors are pushing
for a standardization of definitions, reporting, and impact assessments
to ensure investments are used for their intended purpose.
82 As the 2016 chair of the G20,* China pushed for the global
expansion of green financing through the establishment of international
standards and guidelines, capacity-building for governments
to set up green financing mechanisms and create local green
bond markets, knowledge sharing for banks and institutional investors
on environmental and financial risks, facilitation of investors
and green finance across different countries’ markets, and improvement
in measuring green finance activities and their impact. 83 The
2016 G20 Summit highlighted the importance of green financing
but provided few concrete steps forward, 84 signaling a lack of global
consensus.
China’s Industrial Policies
Under the 13th FYP, the Chinese government seeks to accelerate
China’s transition to higher-value-added, intelligent manufacturing
† by focusing on indigenous innovation and upgrading key
emerging industries such as integrated circuits (ICs), biomedicines,
cloud computing, and e-commerce. 85 In a 2016 report prepared for
the Commission, University of California Institute on Global Conflict
and Cooperation found that the Chinese government has ‘‘vigorously
implemented’’ a variety of policy instruments to support its
technonationalism and indigenous innovation push in these sectors
to include:
(1) sectoral protectionism; (2) the cultivation of local and
national champions; (3) pushing hard for technology transfers;
(4) the use of state catalogues to regulate investment
and technology imports; (5) the promotion of Chinese
technology standards domestically and internationally; and
(6) an increasingly vigorous ‘going out’ strategy to open up
foreign markets for Chinese products as well as to secure
energy and other critical supplies for the country. 86
* The Group of Twenty (G20) is an international forum for government and central banks from
20 major countries to meet and discuss international financial stability issues. Members include
Argentina, Australia, Brazil, Canada, China, the EU, France, Germany, India, Indonesia, Italy,
Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, the United Kingdom,
and the United States. International organizations such as the Financial Stability Board, International
Labor Organization, International Monetary Fund, Organisation for Economic Co-Operation
and Development, World Bank, World Trade Organization, and the UN also participate.
G20 2016 China, ‘‘About G20,’’ November 27, 2015.
† Intelligent manufacturing seeks to integrate information technology into the manufacturing
process for more precise, easily scalable, efficient production.
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