Source: Journal of Contemporary Asia | Published: 2026-05-26
Category: 아시아 정치경제 | Keywords: china, governance, policy, transition
The accelerating pace of climate change has transformed environmental governance from a peripheral concern into a central axis of global political economy. For a country responsible for roughly 30 percent of global carbon dioxide emissions annually, China's approach to climate policy carries consequences that extend far beyond its borders. As multilateral climate commitments face mounting pressure from geopolitical fragmentation and the retreat of certain Western governments from ambitious emissions targets, the trajectory of Chinese climate governance has become one of the most consequential variables in determining whether the international community can achieve the temperature stabilization goals outlined in the Paris Agreement. Against this backdrop, scholarly attention to how China navigates the intersection of political transition, administrative governance, and market design is not merely academically timely — it is practically urgent for development practitioners, aid agencies, and civil society organizations working at the interface of climate finance and policy reform across the Global South.
The article published in the Journal of Contemporary Asia engages with a set of questions that have long animated the comparative political economy literature on developmental states: to what extent can an authoritarian, party-state apparatus effectively deploy market instruments to achieve ambitious public goods outcomes, and what are the structural tensions that arise when centralized governance attempts to harness decentralized market signals? China's climate policy architecture presents a revealing case study in this regard. The country has pursued an explicit dual-track strategy — maintaining heavy administrative direction over energy sector investment while simultaneously developing market-based mechanisms, most notably the national emissions trading scheme (ETS) launched in 2021, which is now the world's largest carbon market by covered emissions volume. The governance challenges embedded in this hybrid approach are substantial. Provincial governments retain significant influence over local industrial policy and energy mix decisions, creating persistent principal-agent problems that undermine the coherence of centrally mandated climate targets. The article's framing of this as a governance challenge rooted in the structural features of China's political economy — rather than merely a technical deficiency in policy design — represents an important analytical contribution.
Understanding China's climate governance trajectory requires situating it within the broader history of Chinese state capitalism and the evolution of the party-state's approach to managing economic transitions. China's carbon market, for example, did not emerge from a liberal market logic of pricing externalities through voluntary exchange; it was constructed top-down as an instrument of central industrial policy, initially covering only the power sector and relying heavily on intensity-based rather than absolute emissions caps. This design choice reflects deeper political-economic imperatives: the need to maintain growth momentum, manage employment in carbon-intensive sectors, and preserve the developmental prerogatives of state-owned enterprises that dominate the energy and heavy industrial landscape. The transition dimension of the article's title is therefore not simply about an energy transition in the technical sense, but about the political economy of transitioning embedded institutional interests — a process that is inherently contested, iterative, and subject to elite bargaining within the party-state apparatus. Scholars of ODA and development finance will recognize parallels with the challenges faced by multilateral development banks attempting to green their lending portfolios in contexts where national development agencies retain strong autonomy over project selection.
The market dimension of China's climate governance also raises important questions for the global carbon finance architecture. Chinese officials have signaled interest in eventually linking the national ETS with other regional and global carbon markets, a prospect that carries significant implications for the credibility and liquidity of international carbon pricing mechanisms. However, concerns about the transparency and integrity of Chinese carbon market data — underscored by regulatory investigations into data fraud among emissions verification firms — point to governance deficits that could undermine confidence in cross-border linkage. From a development perspective, China's role as a major provider of climate finance through instruments such as the Belt and Road Initiative's green investment frameworks adds another layer of complexity. The coherence between China's domestic climate governance ambitions and its external development finance practices remains an open and contested empirical question, with civil society organizations in recipient countries raising concerns about the degree to which Chinese-financed infrastructure projects genuinely integrate climate transition objectives rather than exporting carbon-intensive development models.
Looking forward, the analytical framework offered by this article opens several productive avenues for researchers and practitioners. The tension between transition imperatives and governance capacity is not unique to China — it characterizes climate policy challenges across much of the developing world, where state institutions are simultaneously the primary vehicle for mobilizing climate investment and a significant source of political resistance to the structural reforms that decarbonization demands. For ODA agencies and international civil society organizations engaged in climate governance support, China's experience offers cautionary lessons about the limits of market instrument design in the absence of robust monitoring, reporting, and verification infrastructure, as well as transparent enforcement mechanisms. It also raises normative questions about the appropriate role of external actors in supporting governance reform in large emerging economies that possess both the ambition and the institutional capacity to define their own climate policy pathways. As the global climate finance landscape increasingly pivots toward mobilizing private capital through blended finance mechanisms, understanding how different national governance regimes shape the conditions for market-based climate action will become ever more central to the work of development researchers and practitioners alike. China's ongoing experiment in climate governance under authoritarian state capitalism is, in this sense, not an outlier case but a critical reference point for the future of global climate politics.