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[JCA] China’s Climate Policy: Transition, Governance, and Market

Tommy Keum
Tommy Keum Secretary-General, IOCSS Foundation. Researcher in sports philosophy, Korean Peninsula policy, and cultural theory. Founded IOCSS in Seoul in 2023.
4 min read
Asia Watch News

Source: Journal of Contemporary Asia  |  Published: 2026-07-05

Category: 아시아 정치경제  |  Keywords: china, governance, policy, transition


The accelerating pace of global climate change has fundamentally altered the terrain of international political economy, forcing even the most growth-oriented states to reckon with the structural contradictions between industrial capitalism and ecological sustainability. Few countries embody this contradiction more starkly than China, which simultaneously stands as the world's largest emitter of greenhouse gases and its most ambitious investor in renewable energy infrastructure. As the international community grapples with the inadequacies of existing multilateral climate frameworks, China's evolving domestic policy architecture offers a critical lens through which scholars and practitioners must examine the interplay between state capacity, market formation, and ecological governance. This recent contribution to the Journal of Contemporary Asia arrives at a moment of considerable analytical urgency, as China's role in shaping global climate outcomes is no longer peripheral to international development discourse but central to it.

The article engages seriously with the governance dimensions of China's climate policy, tracing how the Chinese state has sought to manage a complex and often contradictory transition — one that must simultaneously decarbonize a vast industrial base, maintain economic growth sufficient to sustain political legitimacy, and project global leadership on environmental issues. What distinguishes China's approach from liberal democratic climate governance is the degree to which policy instruments are embedded within a hierarchical state architecture where central directives are mediated through provincial administrations with their own fiscal incentives and developmental priorities. The result is a governance landscape marked by vertical tension: ambitious national targets coexist with persistent local implementation gaps, a dynamic that scholars of developmental states will recognize as characteristic of China's broader mode of political-economic management. Understanding this tension is essential for any serious analysis of whether China's climate commitments translate into durable emissions reductions or remain aspirational benchmarks subject to the familiar pressures of GDP-first governance.

The market dimension addressed in this article is equally significant and deserves sustained analytical attention. China has constructed what is now the world's largest carbon trading scheme, and the trajectory of that scheme reflects broader debates about whether market mechanisms can serve as effective instruments of ecological transition within a state-directed economy. The emissions trading system, launched nationally in 2021 after years of regional piloting, has been plagued by design weaknesses — a narrow sectoral scope initially limited to power generation, weak price signals that have failed to incentivize meaningful abatement, and concerns about data integrity that cast doubt on the credibility of reported emissions. Yet this market experiment is not merely a technical failure or success to be evaluated on its own terms; it is a political artifact that reveals the boundary conditions of market-based governance in an authoritarian developmental state. The carbon market must serve the dual masters of emissions reduction and economic stability, and when these objectives conflict, the state has demonstrated a consistent willingness to subordinate environmental integrity to macroeconomic management. This dynamic has important implications for international climate finance and the growing body of literature on green finance architecture.

From the perspective of international development and Official Development Assistance, China's climate trajectory carries implications that extend well beyond its domestic policy arena. China's overseas investments through the Belt and Road Initiative have long attracted criticism for financing high-carbon infrastructure in recipient countries, and the 2021 commitment to cease financing overseas coal projects represented a significant, if incomplete, shift in this posture. The broader question of whether China's own energy transition will generate positive spillovers for developing countries — through technology transfer, reduced costs of renewable equipment, or genuine engagement in climate-aligned multilateral finance — remains contested. Development practitioners working in Asian and African contexts increasingly must account for Chinese bilateral financing as a structural variable shaping the energy policy choices of recipient governments, often in ways that circumvent or complicate the conditionality frameworks associated with traditional ODA from OECD donors. The analytical frameworks developed in this article thus have direct relevance for scholars of South-South cooperation, international public goods provision, and the political economy of development finance.

The civil society dimension of China's climate governance, though often underemphasized in state-centric analyses, is equally worthy of scholarly scrutiny. Environmental non-governmental organizations in China occupy a peculiar and constrained position — tolerated and sometimes actively mobilized by the state to monitor local industrial compliance, yet systematically denied the political autonomy that would allow genuine adversarial advocacy. International civil society actors seeking to engage with Chinese environmental policy face structural barriers that have intensified under the regulatory tightening of the past decade, including restrictions on foreign funding, mandatory registration requirements, and a climate of self-censorship that shapes the boundary conditions of permissible advocacy. This constrained civil society ecology has consequences for the accountability and transparency of China's climate governance, since independent monitoring and public participation mechanisms that function as correctives to state failure in liberal polities are absent or severely attenuated. Comparative scholars of environmental governance would do well to engage seriously with this institutional configuration rather than treating it as simply a deficit relative to democratic norms.

Looking forward, the analytical questions raised by this article carry enduring significance for researchers and practitioners alike. The coming decade will likely determine whether China's proclaimed ecological civilization (生态文明) represents a genuine reorientation of its development model or a discursive adaptation that leaves the fundamental political economy of carbon-intensive growth intact. For international researchers, the challenge is to develop analytical frameworks capable of assessing Chinese climate governance on its own institutional terms while maintaining rigorous comparative standards. For practitioners engaged in climate finance, technology partnership, and multilateral negotiation, China's domestic policy evolution will continue to set parameters that cannot be ignored. The Journal of Contemporary Asia's decision to publish sustained scholarly engagement with this topic reflects a welcome recognition that understanding China's climate policy is no longer a niche concern for area specialists but an indispensable component of the broader scholarly project of making sense of the twenty-first century's most consequential political-economic transformation.


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Tommy Keum

Tommy Keum

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Secretary-General, IOCSS Foundation. Researcher in sports philosophy, Korean Peninsula policy, and cultural theory. Founded IOCSS in Seoul in 2023.

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