Research On The Development Of The Market Of Chinese Carbon Finance In The Context Of Low-carbon Economy

Global warming has been a serious threat to human survival and development, so the emissions reduction of greenhouse gas has increasingly become the focus of international attention. Although our country has no mandatory obligation to reduce emissions, as the largest developing country and a responsible country, our government has promised that the carbon dioxide emissions per unit of GDP in 2020 declines 40%-45% compared with that of 2005.Its fundamental purpose is to control CO2 emissions. The huge market potential of carbon reduction provides a broad space for the development of carbon finance.The low-carbon economy is one kind of green economic development mode which centers on the innovation of energy technology in order to reduce greenhouse gas emissions and accelerate sustainable development of the society. The development of low-carbon economy is an inevitable choice of the economic development in China, which needs much capital investment. So it can’t succeed without financial supports. But it can contribute to the development of low-carbon economy and considerably promotes financial innovation which results in carbon finance in process of the low-carbon economy development. The low-carbon economy has induced the carbon finance which opened up the new era of the financial industry, moreover, the development of carbon finance broadens financing channels, indirectly cut down the carbon emissions, lower the cost of emission and increase international competitiveness. Carbon finance is a series of investment and financing activities about low-carbon economy arising from Kyoto Protocol. It involves financial activities such as direct investment and financing on technologies and projects which serve to limit greenhouse gas emissions, carbon trading and bank loans. It can reduce greenhouse gases effectively,accelerate the transformation of China’s economy and stimulate sustainable growth of China’s economy. At present, CDM projects play a main role in China’s carbon finance market, the carbon reduction provided by China to the international market accounts for about two-thirds of the global market. China’s carbon finance market starts to develop very late, therefore there is still room for improvement. For example, there are no unified and standard national carbon emissions trade centers. Carbon futures, carbon funds, carbon trusts and other carbon financial products are scarce. The participation of enterprise is not popular. To solve these problems, we should seize the opportunity and meet the challenge. Government needs to promulgate some incentives for carbon finance. Commercial banks, securities companies and fund companies should innovate carbon finance business and products. Companies should also enhance the motivation to participate in carbon finance so that China’s carbon finance market can develop better and faster.This paper describes the origins and theoretical meaning about carbon finance, and then introduces the present status of China’s carbon financial market and problems existing in the process of its development. Finally, this paper brings out some policy recommendations to build China’s carbon finance market.