Chongqing- The innovation and cooperation between Chongqing and Singapore have demonstrated the strong connection between China’s western region and Association of Southeast Asian Nations (ASEAN) countries, according to Zeng Gang, Deputy Director of National Institution for Finance and Development and Director for Shanghai Institution for Finance and Development.

In particular, this helps to lay a solid foundation of promoting regional economic development and building the western financial center, pushing into a new development pattern of "dual circulation".

"In terms of key directions of financial support for carbon emission reduction," said Zeng. “Among which energy conservation and emission reduction technology in industries and finance transformation should be focused.”

Carbon emission reduction

Zeng pointed out that the current structure of carbon emission in China is roughly 40% of the power industry, 40% of the industry, and 10% of the construction industry and transportation respectively. From this ratio, the focus of future emission reductions will be in the energy and industrial sectors.

He believes that green transportation and green buildings are the key directions in the future.

"Chongqing is an important industrial city, which means that in the process of transformation, there is a lot of room for emission reduction," said Zeng. "Chongqing serves as one of the first pilot cities with a carbon emission trading system, and their years of experience and talent training have formed core competitiveness."

To achieve the goal of carbon emission reduction, Zeng thinks the path of industrial adjustment is mainly in two directions. The first is to adjust the energy structure and shift from traditional energy to clean energy, while the second is to improve energy efficiency, especially to improve the efficiency and cleanliness of traditional energy.

Lastly, due to the proposal of carbon neutrality, some new technologies, including carbon capture and storage, meaning the process of capturing carbon dioxide formed during power generation and industrial processes and storing it, can also be used as a supplement to achieve carbon emission reduction.

Finance transformation

Regarding financial support to meet the country's "dual carbon goals", Zeng said that it is important to further support industries with advanced energy-saving and emission-reduction technologies.

The transformation of finance is not only about a green industry but also a traditional industry. Through financial support, it will help traditional industries to transform technology, improve energy efficiency and cleanliness so that traditional industries can reduce emissions, and support green development while ensuring the stability of the energy supply.

Zeng thinks, next, exploring how to integrate various regional pilots to form a complete and unified national carbon emission trading system is essential. It is also necessary to explore how to enrich financial attributes and improve liquidity in the carbon emissions trading market.

The China-Singapore (Chongqing) Connectivity Initiative Financial Summit 2021 (CCI-FS), has been successfully held for three consecutive years since 2018. It has become an important platform for financial industry exchanges and cooperation between western China and ASEAN countries.

(Zhang Yue, as an intern, also contributed to this report.)