Central Bank governor says China will provide low-cost loans to reduce emissions

BEIJING (Reuters) – China’s central bank will provide the first series of low-cost loans by the end of the month to help financial institutions reduce their carbon footprint, Xinhua State said in an interview with central bank governor Yi Gang on Tuesday. .

The People’s Bank of China (PBOC) said in November that it would lend 60% of its borrowing capital to reduce carbon emissions, and that the one-year loan rate would be 1.75%, without specifying when the loans would be granted.

The measure is in line with China’s broader goal of peaking emissions by 2030 and achieving carbon neutrality by 2060, as well as protecting the economy from the fall of the COVID-19 pandemic.

The Chinese economy, the largest in the world behind the United States, is facing triple the pressure of declining demand, supply problems and weakening expectations, Yi said, echoing previous official comments.

“The macroeconomic market needs to be stabilized,” he told Xinhua. “Furthermore, it is necessary for the shareholders and local authorities of the companies to take responsibility for the risky events that take place in the market.”

Yik said the PBOC will maintain its flexible and appropriate monetary policy and broad liquidity.

To further alleviate the pressure on businesses, they can generally get loans from companies with an average interest rate of 5%, Yi said, adding that the PBOC will increase the refinancing fee for small businesses as needed.

He also said that financial risks are under control and expectations for the real estate market have improved.

“The structural adjustment of the property market is conducive to the formation of a new model of real estate development in the country and the healthy development of the entire industry,” Yi said.