Source: Journal of Contemporary Asia | Published: 2026-08-18
Category: 아시아 정치경제 | Keywords: china, governance, policy, transition
The question of how major economies govern their transitions to low-carbon futures has become one of the defining challenges of the early twenty-first century. For China — the world's largest greenhouse gas emitter, largest manufacturer of renewable energy technology, and a country simultaneously dependent on coal and increasingly dominant in solar and wind production — this question carries exceptional weight. China's climate policy does not unfold in isolation; it is embedded in the country's broader developmental strategy, its model of state-led capitalism, and its evolving position in global multilateral institutions. As international pressure for more ambitious emissions reductions grows, and as climate finance and green industrial policy become increasingly contested terrain in the global political economy, the way China structures its climate governance matters not only domestically but for every country that trades with it, receives investment from it, or participates in the same international agreements. A new contribution in the Journal of Contemporary Asia takes up precisely this intersection of climate policy, governance architecture, and market mechanism design, offering a timely analytical lens through which scholars and practitioners can assess where China stands and where it is heading.
At the heart of any serious examination of China's climate governance is the tension between central planning and market-based instruments. Since the late 2000s, Chinese authorities have progressively integrated carbon pricing into their policy toolkit, culminating in the launch of the national Emissions Trading Scheme (ETS) in 2021, which now covers a larger volume of carbon dioxide emissions than any comparable system in the world. Yet the Chinese ETS operates within a political economy that is structurally different from its European counterpart. Allocation methods remain largely grandfathered rather than auctioned, price signals have been dampened by policy interventions, and the scheme's initial scope — limited to the power sector — reflects the political difficulties of extending carbon costs to industries with strong provincial employment interests. The analytical contribution of work in this area lies in unpacking how these design choices are not merely technical but reflect deeper governance logics: the imperative to maintain social stability, the continued role of state-owned enterprises as instruments of industrial policy, and the sequential, experimental approach to reform that has characterized Chinese policymaking since the Deng era. Understanding these logics is essential for any realistic assessment of whether China's market instruments will deliver the emissions trajectories its international commitments imply.
The concept of transition itself deserves scrutiny in the Chinese context. China's declared goal of reaching peak carbon emissions before 2030 and carbon neutrality by 2060 — the so-called "dual carbon" targets — represents an extraordinary ambition for an economy still in the midst of industrialization in many interior provinces. These targets are not simply environmental commitments; they are interwoven with industrial policy objectives, most visibly in China's now-dominant position in the global supply chains for photovoltaic panels, lithium-ion batteries, and electric vehicles. The political economy of this green industrial transition has generated new forms of state-market interaction, including massive public investment in research and manufacturing capacity, the use of feed-in tariffs and procurement mandates to build domestic industries, and the strategic deployment of these industries in Belt and Road Initiative partner countries. Scholars of comparative political economy and development studies should recognize in this pattern something familiar from earlier phases of East Asian developmental statism, now re-articulated through the language of ecological civilization. What is distinctive about the Chinese case is the sheer scale, the simultaneity of the energy production and consumption challenge, and the extent to which climate policy has become entangled with geopolitical competition — particularly with the United States and the European Union, both of which have introduced measures to protect their own green industries from Chinese competition.
The governance dimension of China's climate policy raises important questions about the relationship between central ambition and local implementation, a perennial challenge in a country of China's territorial and administrative complexity. Provincial governments retain substantial autonomy over energy mix decisions, and regions that depend heavily on coal — whether for power generation or as a source of mining employment — face genuine structural adjustment pressures that create implementation gaps between announced targets and observed outcomes. Research has documented repeated instances of local governments underreporting emissions, maintaining industrial capacity that is officially scheduled for retirement, or substituting one pollutant for another in ways that satisfy narrow metrics without achieving broader environmental goals. At the same time, some provincial experiments in carbon markets, renewable energy procurement, and green finance have moved ahead of the national framework, suggesting a dynamic of competitive localism that can, under the right central incentives, generate genuine innovation. Governance analysis must therefore resist both naive top-down readings of Chinese policy — in which central directives are assumed to translate smoothly into outcomes — and equally misleading bottom-up fragmentation narratives that underestimate the capacity of the central state to enforce compliance when political will is high.
For the broader ODA and development policy community, China's climate trajectory matters in ways that are sometimes underappreciated. China remains the single largest bilateral financier of infrastructure in the developing world, and decisions made in Beijing about the carbon intensity of its overseas lending portfolio — the extent to which Belt and Road projects continue to include coal-fired power plants, or shift decisively toward renewables — have direct consequences for the emissions trajectories of dozens of low- and middle-income countries. The 2021 commitment by President Xi Jinping to cease building new coal plants overseas was significant, but implementation has been uneven and the financing gap left by the retreat from coal has not always been filled by concessional green alternatives. For development scholars and practitioners, this creates both an analytical agenda — tracking the actual composition of Chinese overseas energy finance — and a policy engagement opportunity, in which multilateral institutions and bilateral donors can coordinate to shape the terms on which China's green finance evolves. Equally relevant is the question of technology transfer: if Chinese manufacturers continue to reduce the cost of solar, wind, and battery technology, the implications for energy access in the Global South could be transformative, but only if the commercial and intellectual property conditions under which these technologies are transferred allow genuine local capacity-building rather than simple equipment export.
Looking forward, the trajectory of China's climate governance will be shaped by at least three intersecting forces that researchers and practitioners should monitor closely. The first is the political economy of the energy transition within China itself, including how the costs of decarbonization are distributed across regions, industries, and social groups, and whether the governance institutions capable of managing these distributional conflicts can be developed at sufficient speed. The second is the relationship between China's domestic climate ambition and its international positioning, particularly as the post-Paris architecture of the UN Framework Convention on Climate Change moves toward the 2035 nationally determined contribution cycle and countries face pressure to close the gap between current policies and the 1.5-degree pathway. China's choices in this diplomatic space will shape the credibility of the entire international climate regime. The third is the interaction between climate policy and the broader restructuring of the global political economy, including the competition over clean technology supply chains, the emergence of carbon border adjustment mechanisms, and the question of how climate finance flows will be organized in a world of heightened great-power rivalry. Scholarship that can hold all three of these dimensions in analytical view simultaneously — as the best work in journals like the Journal of Contemporary Asia aspires to do — will be indispensable for any serious attempt to understand, and ultimately to influence, the arc of China's climate policy in the decade ahead.