Source: Journal of Contemporary Asia | Published: 2026-05-20
Category: 아시아 정치경제 | Keywords: china, governance, policy, transition
The question of how China manages its energy transition and climate governance has emerged as one of the defining issues in contemporary global political economy. As the world's largest emitter of greenhouse gases and simultaneously its largest investor in renewable energy infrastructure, China occupies a structurally paradoxical position in international climate negotiations and domestic policy implementation alike. Understanding the internal mechanisms through which Beijing pursues decarbonization — the interplay between central mandates, provincial experimentation, and emerging carbon market institutions — is not merely a matter of area studies interest. It carries direct implications for global climate trajectories, for the credibility of multilateral climate commitments, and for how development-oriented institutions conceive of the relationship between state capacity and market-based environmental governance. The article under review, published in the Journal of Contemporary Asia, intervenes in this conversation by examining how China's climate policy regime is being constructed across the axes of political transition, institutional governance, and market formation — a triad that captures something essential about the Chinese developmental state's approach to the green economy.
At the heart of the analysis is the recognition that China's climate policy is not reducible to a single command-and-control model, nor to a straightforward market liberalization narrative. Rather, what has emerged is a layered governance architecture in which the central government sets ambitious headline targets — peak carbon emissions before 2030, carbon neutrality before 2060 — while delegating much of the operational complexity to subnational actors, state-owned enterprises, and increasingly to market mechanisms such as the national Emissions Trading Scheme (ETS) launched in 2021. This layered structure reflects a broader pattern in Chinese governance more generally: the use of target-responsibility systems, experimentation in pilot zones, and selective market instruments as tools for achieving state objectives without fully relinquishing political control. The article's contribution lies in disaggregating this complexity, tracing how the transition imperative interacts with entrenched industrial interests, fiscal dependencies on carbon-intensive sectors, and the uneven capacities of local governments to monitor and enforce compliance with emissions standards.
The governance dimension of the analysis is particularly significant in light of comparative debates about green state capacity. Much of the literature on green industrialization has focused on East Asian developmental states — South Korea, Taiwan, and Japan — as models of directed industrial policy that successfully coupled economic upgrading with environmental improvement. China's case both extends and complicates this tradition. The scale of China's renewable energy build-out — solar panel manufacturing, wind turbine installation, electric vehicle supply chains — reflects state-directed industrial policy of a scope that dwarfs its predecessors. Yet the same governance apparatus that enables rapid deployment of green infrastructure also generates coordination failures, perverse incentives, and rent-seeking behavior that slow the actual decarbonization of the economy. The persistence of coal power, driven in part by provincial revenue imperatives and energy security anxieties, illustrates the political limits of even a highly centralized climate governance system. The article's engagement with these contradictions helps explain why China's emissions trajectory, despite genuine policy ambition, continues to create uncertainty in global climate modeling exercises.
The market dimension of the analysis connects to a broader scholarly and policy conversation about carbon pricing as a tool of climate governance. China's national ETS is now the world's largest by coverage, yet its effectiveness remains contested. Critics point to the initial allocation of permits largely for free to covered emitters, the limited price signal generated in early trading periods, and gaps in data quality and verification that undermine the market's integrity. Proponents argue that the ETS represents a foundational institutional investment whose stringency can be progressively tightened as political conditions permit, and that the experience accumulated in China's seven pilot ETS programs prior to the national launch provides a substantial evidence base for iterative improvement. The article situates this debate within the specificities of China's political economy, where market mechanisms are instruments of state policy rather than autonomous allocative processes. This framing has broader relevance for development scholars, since many of the climate-finance instruments now being promoted for the Global South — green bonds, carbon offsets, results-based finance — similarly involve the grafting of market logics onto governance systems where state-market boundaries are fluid and contested.
From a policy perspective, the research carries implications for how international development institutions — including multilateral development banks, bilateral ODA providers, and climate finance mechanisms such as the Green Climate Fund — engage with China both as a recipient of technical knowledge exchange and increasingly as a provider of climate-related development finance through the Belt and Road Initiative. China's overseas energy investments have historically skewed toward fossil fuels, reflecting the commercial and diplomatic interests of Chinese state-owned enterprises and the demand preferences of host-country governments. However, there are emerging signals of a reorientation, with the 2021 announcement that China would no longer finance new coal-fired power plants abroad marking a potentially significant, if unevenly implemented, policy shift. Understanding the domestic governance dynamics analyzed in this article — the competition among ministries, the role of the National Development and Reform Commission versus the Ministry of Ecology and Environment, the interest-group politics surrounding coal and steel — is essential for interpreting what such international commitments actually mean in practice and what kinds of external engagement strategies are most likely to reinforce rather than undermine progressive domestic constituencies.
Looking forward, the analytical framework developed in the article offers a productive lens for tracking how China's climate governance evolves through the remainder of the 2020s, a period that will be decisive for global emissions trajectories. Several developments merit close attention. The tightening of the national ETS — particularly the expansion of coverage beyond the power sector to include steel, cement, aluminum, and chemicals — will test whether the market instrument can generate sufficient price discipline to drive fuel switching and investment in clean technology at the pace required by China's own stated targets. The relationship between climate policy and China's broader economic slowdown, including the real estate sector crisis and subdued household consumption growth, introduces new political economy uncertainties: on one hand, industrial overcapacity in green sectors like solar and EVs may accelerate global clean energy deployment through export price effects; on the other, fiscal pressures may weaken the enforcement capacity of environmental regulators at subnational levels. For researchers working at the intersection of development studies, political economy, and climate governance, China's ongoing experiment in green state capitalism represents an indispensable laboratory — one whose outcomes will shape not only domestic conditions but the terms on which the global community negotiates the transition to a low-carbon economy in the decades ahead.