Source: Journal of Contemporary Asia | Published: 2026-07-24
Category: 아시아 정치경제 | Keywords: china, governance, policy, transition
The intersection of climate governance, political economy, and market mechanisms in China represents one of the most consequential policy domains of the contemporary era. As the world's largest emitter of greenhouse gases and the second-largest economy, China's trajectory on climate transition does not merely shape its own developmental prospects but fundamentally conditions the global community's ability to meet the ambitions of the Paris Agreement. The publication of this analysis in the Journal of Contemporary Asia arrives at a moment when scrutiny of China's climate commitments has intensified across multiple registers — from multilateral negotiations at successive COP summits, to bilateral tensions with major Western economies over carbon border adjustments, to domestic pressures arising from increasingly severe climate-related disasters affecting China's own agricultural and urban systems. Understanding how China navigates the interplay between institutional governance structures, market-based instruments, and the broader imperatives of political transition is therefore not merely an academic exercise but a practical necessity for researchers, policymakers, and development practitioners working across the Indo-Pacific and beyond.
At the heart of China's climate policy challenge lies a structural tension that this kind of analysis is well-positioned to illuminate: the need to decarbonize an economy that remains, in significant regional pockets, deeply dependent on coal-fired industry and heavy manufacturing, while simultaneously maintaining the economic growth rates that underpin the Chinese Communist Party's domestic legitimacy. The concept of "ecological civilization" (shengtai wenming), elevated to constitutional status under Xi Jinping's leadership, represents an ideological framework through which the party-state has sought to reconcile these competing imperatives. Yet the transition from rhetoric to governance is rarely linear, and the governance dimension of China's climate policy reveals persistent tensions between central directives and local implementation. Provincial governments, particularly in rustbelt regions of the northeast and coal-heavy interior provinces, have often faced incentive structures that reward short-term economic output over compliance with emissions targets. The layered administrative architecture of the Chinese state — in which policy mandates cascade from the National Development and Reform Commission and the Ministry of Ecology and Environment down through provincial, prefectural, and county-level authorities — creates both formidable implementation capacity and significant opportunities for what scholars in comparative political economy have called "selective compliance." Analyzing how governance reforms have sought to address this compliance gap, including through reformed cadre evaluation systems that weight environmental performance alongside GDP growth, is central to assessing whether China's transition commitments are structurally durable or remain subject to cyclical backsliding during periods of economic stress.
The market dimension of China's climate policy has arguably attracted the most international attention, particularly since the launch of the national Emissions Trading Scheme (ETS) in 2021, which covers the power sector and has subsequently been expanded. In terms of total covered emissions, China's national carbon market is the largest in the world by volume, yet it differs fundamentally from the European Union's Emissions Trading System in its design architecture and the political economy assumptions embedded within it. Where the EU ETS has progressively tightened caps and moved toward auctioning rather than free allocation of permits, China's national ETS has operated through intensity-based benchmarks rather than absolute caps, meaning that overall emissions can still rise even as efficiency improves. This design choice reflects a deliberate policy judgment — calibrated to avoid imposing sharp cost shocks on state-owned energy enterprises that remain systemically important — but it also raises serious questions about whether the market mechanism can drive the depth of decarbonization that China's 2060 carbon neutrality pledge requires. Scholarly analysis of this architecture contributes to a growing body of comparative climate governance literature examining how developing and transition economies adapt market-based instruments to their specific institutional contexts, often producing hybrid forms that do not map cleanly onto either the command-and-control or liberal market ideal types familiar from Western policy traditions.
The broader regional and global dimensions of China's climate policy transition are equally significant for the research agenda of institutions engaged with ODA and development finance. China's role as both a major bilateral development lender through the Belt and Road Initiative (BRI) and a recipient-turned-donor in the global climate finance architecture places it in a structurally ambiguous position in international negotiations over climate-related official development assistance. The greening of BRI — encompassing the Green Investment Principles announced in 2019, subsequent guidance on managing environmental and social risks in overseas investments, and China's 2021 commitment to halt overseas coal financing — represents a meaningful, if uneven, evolution in Chinese development finance norms. However, scholars and practitioners working on ODA effectiveness have noted that the translation of these commitments into project-level due diligence, environmental impact assessment, and grievance mechanisms remains inconsistent across different implementing institutions and recipient contexts. The governance of China's overseas climate finance thus mirrors, in amplified form, the domestic tensions between central policy ambition and decentralized implementation that characterize its internal climate governance. For civil society organizations in recipient countries, navigating the emerging landscape of Chinese development finance requires an increasingly sophisticated understanding of how China's own climate transition politics shape the conditionalities, risk appetites, and disclosure practices attached to BRI financing.
Looking forward, the scholarly and policy significance of rigorous analysis of China's climate governance lies in its capacity to disaggregate what is often treated as a monolithic national position into its constitutive institutional, political, and market components. The transition China is undertaking — from a growth model built on energy-intensive manufacturing to one oriented toward high-technology industry, services, and green energy — is historically unprecedented in its scale and speed. Whether this transition is managed through market signals, administrative mandates, or some evolving hybrid will have profound implications not only for global emissions trajectories but for the competitiveness of renewable energy supply chains, the structure of global carbon markets, and the normative frameworks governing climate-related development finance across Asia and Africa. For researchers at institutions focused on civil society, ODA, and political economy, the Chinese case offers both a challenging empirical object of study and a theoretical provocation: it demands rethinking assumptions about the relationships between state capacity, market development, and environmental governance that were largely constructed from OECD-country experience. Practitioners working in climate finance, green development corridors, or civil society engagement with Chinese-funded infrastructure would benefit from sustained engagement with this analytical literature as it matures, recognizing that China's climate governance is not a settled system to be evaluated against a fixed standard but an evolving political economy whose trajectory remains genuinely open and consequential for the entire global development community.