In order to give full play to the leading role of green finance and improve the standard system and basic system of green finance, the People's Bank of China, the State Administration of Financial Supervision and Administration, and the China Securities Regulatory Commission recently jointly issued the Catalogue of Green Finance Support Projects (2025), to further strengthen financial support for economic and social development, comprehensive green transformation, and building a beautiful China. At present, China's green credit scale ranks first in the world, and the market size of green bonds and green insurance ranks among the top in the world. It is expected that the funding demand for achieving the carbon peak target by 2030 will exceed 25 trillion yuan, and the development space of green finance is very broad. According to the Report on the Implementation of China's Monetary Policy in the First Quarter of 2025 issued by the People's Bank of China in support of policy strengthening, green bonds were issued totaling 4.3 trillion yuan at the end of March this year, including 1.8 trillion yuan of green financial bonds, providing a stable source of funds for financial institutions to invest in green credit. Lou Feipeng, a researcher at China Postal Savings Bank, believes that the significant increase in the issuance scale of green financial bonds this year compared to the same period last year is due to multiple factors. In terms of policies, financial regulatory authorities support the development of green finance, and green bonds are an important component of it; In terms of the market, there is a strong demand for green transformation among enterprises, which drives the growth of demand for green bonds; In addition, the clear purpose of the funds raised by green bonds and the low market interest rates have also driven the rapid growth of their issuance scale. The Opinions on Giving Play to the Role of Green Finance to Serve the Construction of a Beautiful China issued by the People's Bank of China and other four departments last October stressed that efforts should be made to improve the green financial service capacity of financial institutions and enrich green financial products and services. Banks, insurance, securities, funds and other financial institutions should focus on their functional positioning and improve the quality of green finance supply. Continuously increasing green credit investment, developing green financial products such as green bonds and green asset securitization, and strengthening green financing support. The rapid development of green finance has made China one of the most dynamic green finance markets in the world. This is mainly due to the dual empowerment of the green finance policy system and market practices, especially the leading role of standards. ”Ren Deqi, Chairman of Bank of Communications, said that this year the People's Bank of China has updated and released a list of projects supported by green finance, expanding the business boundaries and scope of green finance. Under the support and guidance of national policy standards, the balance of domestic and foreign currency green loans in China reached 40.61 trillion yuan at the end of the first quarter of this year, an increase of 9.6% from the beginning of the year, and an increase of 3.56 trillion yuan in the first quarter. In terms of usage, the balance of infrastructure green upgrade loans, energy green and low-carbon transformation loans, and ecological protection, restoration, and utilization loans are 18.11 trillion yuan, 8.13 trillion yuan, and 4.81 trillion yuan, respectively. Focusing on key areas and deepening the fight against pollution prevention and control is one of the key areas for increasing support for green finance. On June 13th, China Development Bank successfully issued 8 billion yuan of 3-year green financial bonds to the world at the Shanghai Clearing House, with an issuance interest rate of 1.32%. The bonds received enthusiastic subscriptions from various investors, with a subscription multiple of 2.33 times. The funds raised from this issuance will be used to support urban renewal projects such as the construction and operation of sewage treatment, recycling, and sludge treatment and disposal facilities, as well as the construction and operation of domestic waste treatment facilities. According to calculations, the relevant projects are expected to achieve an annual reduction of 44600 tons of carbon dioxide and save 22000 tons of standard coal after being converted based on the proportion of green bond support. The Opinions on Continuously Promoting Urban Renewal Action issued by the General Office of the Communist Party of China Central Committee and the General Office of the State Council propose to improve diversified investment and financing methods. The relevant person in charge of the Capital Department of China Development Bank stated that this issuance is a specific measure to provide financial support for urban renewal actions. The next step will be based on functional positioning, focusing on main responsibilities and businesses, doing a good job in green finance, attracting social funds in a market-oriented manner, and jointly supporting the green transformation of urban and rural construction and development. Urban renewal contains enormous growth potential and development opportunities. In recent years, regulatory authorities have continuously guided financial institutions to vigorously support the renovation of urban villages, promote increased credit allocation, and create more physical workloads. They have also guided financial institutions to actively participate in infrastructure and major project construction to meet the reasonable financing needs in areas such as water, electricity, gas, heating, transportation and warehousing, communication, urban pipeline network, and underground comprehensive pipeline corridor renovation, and promote the improvement and efficiency of infrastructure construction. In addition, guide financial institutions to fully leverage the role of operational property loans and support the renovation of inefficient buildings, existing commercial facilities, and other property projects. In addition to bank credit, we also focus on leveraging the unique advantages of different financial instruments, encouraging financial institutions such as insurance and trust to actively participate in urban renewal, and providing financial support through various means such as debt investment, equity investment, and property investment. ”Liao Yuanyuan, Director of the Statistics and Risk Monitoring Department of the State Administration of Financial Supervision and Administration, said. In the process of benchmarking the national "dual carbon" target requirements to address climate change, there are still problems in the development of green finance in China. Ren Deqi believes that the main problems are insufficient coverage of standards, inadequate product innovation, and inadequate market mechanisms. Industry insiders analyze that in terms of product system, green financial instruments are still dominated by traditional credit and bonds, and there is a lack of innovative products. For example, weather derivatives, as an important tool for managing climate risks, have not yet been launched in China, while they have been developed for many years in the United States and Europe. In the past 30 years, meteorological disasters have been relatively severe, climate change has been significant, and up to 92% of losses in the insurance industry have come from disasters directly or indirectly caused by meteorology. This makes meteorological services particularly important for the insurance industry. ”Zhao Yanxia, a specially appointed researcher at the Institute of Atmospheric Sciences, Fudan University, said. Zhao Peng, president of the People's Insurance Corporation of China, said that the wider the insurance coverage of a country or region, the faster it will recover from extreme weather events. The government is increasingly recognizing the important role of insurance in risk management and protection, and is paying more attention to leveraging the power of insurance to address climate change. Therefore, PICC upgraded and established the China Urban and Rural Residential Catastrophe Insurance Community, and innovated and developed the PICC meteorological index insurance pricing model. Through these measures, the scope of catastrophe insurance coverage has been expanded from a single earthquake compensation to multiple disaster compensation, including earthquake, typhoon, flood, rainstorm, debris flow and so on. In the context of climate change, we urgently need tools for risk diversification. Insurance is a very good tool, but relying solely on insurance is not enough, more tools are needed. ”Zhao Yanxia said that she believes that in the future, finance and meteorology will work more closely together to support financial service management and sustainable development of green finance. (New Society)