China
Leaders must commit to green finance at COP26 to avoid climate catastrophe
Author: Christoph Nedopil Wang, Fudan University
Greening finance will be front and centre at the 26th Conference of the Parties (COP26) to the United Nations Framework Convention on Climate Change this November in Glasgow. The main program features a finance day on 3 November, putting finance ahead of the other seven themed days. But there is a danger that leaders’ hopes for ‘mobilising finance’ in the fight against climate change are over-simplistic and over-optimistic. Leaders risk overpromising and underdelivering.
To improve green finance as a powerful tool for reducing climate emissions and increasing climate change resilience in Asia and beyond, leaders at COP26 must make tough choices. They must decide which commitments they will negotiate within the different workstreams and the leaders’ summit. The risk is that leaders will focus on topics that require lengthy discussions. These discussions may not yield (new) results or may produce underwhelming outcomes, such as global emission trading schemes or finance for developing countries.
While development finance is urgently required across Asia and the Pacific, the topic has become a quagmire consisting of different politically motivated initiatives, such as China’s Belt and Road Initiative, Europe’s Global Connectivity Strategy and the G7’s ‘Build Back Better World’ strategy. For development finance, leaders from developing countries should require their peers from developed countries to deliver on the already promised US$100 billion of annual development finance and green technology transfer. But they should avoid wasting time on possibly minor distribution questions, which risk diverting attention away from the broader issues.
Rather, for COP26, leaders should focus on three green finance priorities. Reaching commitments on these priorities could affect up to 70 per cent of global emissions.
First, leaders should negotiate a commitment that all government spending at home and abroad aligns with the Paris Agreement. Most governments of large economies in the West and in Asia finance more than 45 per cent of their national GDPs through direct government spending, subsidies, state-owned enterprises and public banks. Public finance has an obvious responsibility to lead the way in greening finance.
Phasing out the use of public money to pay for harmful projects, like subsidies for fossil fuel, is complex but should be implemented before 2025. World leaders should agree to more — all public funding and particularly overseas financing through policy banks must become climate neutral. It would be a great outcome to commit public banks to stop funding any new non-climate-aligned projects by 2025 and divest from all non-aligned projects by 2040. By accelerating investments in green technologies, greening public finance may also drive down the cost of green technologies, with massive benefits for emerging economies.
Second, leaders should negotiate a commitment to accelerate green commercial finance and cut greenwashing. Global frameworks are crucial for this. Two areas are particularly relevant: taxonomies and climate disclosure. Both have been discussed for a few years to reduce uncertainty for financial institutions and to create more efficient markets for greening finance — for example, in ASEAN or between China and the European Union.
For COP26, a big challenge will be the transition finance standards that will help firms in polluting industries, like gas companies, receive finance to inch towards carbon neutrality. The debate about whether to develop a transition standard — between the science-based green finance experts who worry about undercutting climate goals and incumbent industries and less developed economies who worry about being ‘phased-out’ too quickly — is heated. At COP26, leaders should develop a common, science-based ‘dirty’ finance taxonomy that signals the need for the immediate phase-out of harmful industries. The middle ground between the dirty and the harmonised green finance taxonomy could be the basis for transition finance.
Addressing the challenge of transparency is necessary to stop often bogus ‘net-zero’ promises and greenwashing. Ideally, leaders at COP26 would agree on a roadmap that requires the application of a standardised climate disclosure framework by 2025, which includes disclosing at least all the emissions necessary to produce a given good or service, including those produced by suppliers.
Third, leaders should negotiate a commitment on green trade finance — the highly complex…
Business
China’s Golden Rooster Film Festival Kicks Off in Xiamen – Thailand Business News
The 2024 China Golden Rooster and Hundred Flowers Film Festival began in Xiamen on Nov 13, featuring awards, cultural projects worth 31.63 billion yuan, and fostering international film collaborations.
2024 China Golden Rooster and Hundred Flowers Film Festival Opens
The 2024 China Golden Rooster and Hundred Flowers Film Festival commenced in Xiamen, Fujian province, on November 13. This prestigious event showcases the top film awards in China and spans four days, concluding with the China Golden Rooster Awards ceremony on November 16.
The festival features various film exhibitions, including the Golden Rooster Mainland Film Section and the Golden Rooster International Film Section. These showcases aim to highlight the achievements of Chinese-language films and foster global cultural exchanges within the film industry.
On the festival’s opening day, a significant milestone was reached with the signing of 175 cultural and film projects, valued at 31.63 billion yuan ($4.36 billion). Additionally, the International Film and Television Copyright Service Platform was launched, furthering the globalization of Chinese film and television properties.
Source : China’s Golden Rooster film festival opens in Xiamen – Thailand Business News
China
Italy and China New DTA Set to Take Effect in 2025: Important Changes and Implications
Italy ratified an upgraded Double Tax Agreement (DTA) with China, effective in 2025, to reduce tax burdens, prevent evasion, and enhance investment. The DTA introduces modern provisions aligned with international standards, targeting tax avoidance and improving dispute resolution for Italian businesses.
Italy recently ratified the upgraded Double Tax Agreement (DTA), which will finally take effect in 2025. This agreement was signed in 2019 and was designed to reduce tax burdens, prevent tax evasion, and promote Italian investment in China.
On November 5, 2024, Italy’s Chamber of Deputies gave final approval to the ratification of the 2019 Double Tax Agreement (DTA) between Italy and China (hereinafter, referred to as the “new DTA”).
Set to take effect in 2025, the new DTA is aimed at eliminating double taxation on income, preventing tax evasion, and creating a more favorable environment for Italian businesses operating in China.
The ratification bill for the new DTA consists of four articles, with Article 3 detailing the financial provisions. Starting in 2025, the implementation costs of the agreement are estimated at €10.86 million (US$11.49 million) annually. These costs will be covered by a reduction in the special current expenditure fund allocated in the Italian Ministry of Economy’s 2024 budget, partially drawing from the reserve for the Italian Ministry of Foreign Affairs.
During the parliamentary debate, Deputy Foreign Minister Edmondo Cirielli emphasized the new DTA’s strategic importance, noting that the agreement redefines Italy’s economic and financial framework with China. Cirielli highlighted that the DTA not only strengthens relations with the Chinese government but also supports Italian businesses, which face increasing competition as other European countries have already established double taxation agreements with China. This ratification, therefore, is part of a broader series of diplomatic and economic engagements, leading up to a forthcoming visit by the President of the Italian Republic to China, underscoring Italy’s commitment to fostering bilateral relations and supporting its businesses in China’s complex market landscape.
The newly signed DTA between Italy and China, introduces several modernized provisions aligned with international tax frameworks. Replacing the 1986 DTA, the agreement adopts measures from the OECD/G20 Base Erosion and Profit Shifting (BEPS) Project and the OECD Multilateral Instrument (MLI), targeting tax avoidance and improving dispute resolution.
The Principal Purpose Test (PPT) clause, inspired by BEPS, is one of the central updates in the new DTA, working to prevent treaty abuse. This clause allows tax benefits to be denied if one of the primary purposes of a transaction or arrangement was to gain a tax advantage, a move to counter tax evasion through treaty-shopping.
| This article was first published by China Briefing , which is produced by Dezan Shira & Associates. The firm assists foreign investors throughout Asia from offices across the world, including in in China, Hong Kong, Vietnam, Singapore, and India . Readers may write to info@dezshira.com for more support. |
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Business
China’s New Home Prices Stabilize After 17-Month Decline Following Support Measures
China’s new home prices fell for the 17th month in October, declining 0.5% from September, but slowing, indicating potential market stabilization amid supportive measures. Second-hand home prices showed mixed trends.
Decline in China’s Home Prices Stabilizes
China’s new home prices continued to decline in October for the 17th consecutive month, although the drop showed signs of slowing. Recent support measures from Beijing appear to be inching the market toward stabilization, as evidenced by a lighter decline compared to earlier months.
Monthly and Yearly Comparisons
According to the latest data from the National Bureau of Statistics, new home prices across 70 mainland cities fell by 0.5% from September, marking the smallest decrease in seven months. Year-on-year, prices dropped by 6.2%, slightly worse than the September decline of 6.1%. In tier-1 cities like Beijing and Shanghai, prices decreased by 0.2%, a smaller fall than 0.5% in the previous month.
Second-Hand Home Market Trends
Second-hand home prices in tier-1 cities experienced a 0.4% increase in October, reversing a 13-month downward trend. Conversely, tier-2 cities observed a 0.4% drop in second-hand prices, while tier-3 cities faced a similar 0.5% decline. Overall, recent trends indicate a potential stabilization in China’s property market.
Source : China’s new home prices slow 17-month decline after support measures kick in
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- China’s New Home Prices Stabilize After 17-Month Decline Following Support Measures
- U.S. national debt is its Achilles’ heel, but China sees it as an opportunity
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