Carbon Peak and Neutrality - Guo Jiping on China's World Order Vision - Liu He on Confidence in China's Economy - Small & Micro Loans at RMB 18.6 Trln
Here are the stories and pieces from the October 25, 2021, edition of the People’s Daily that I found noteworthy.
Page 1: The lead article on the page is a feature about the development of western regions. This is a long piece that I am not going into, but it’s worth highlighting how Xi’s quote at the beginning gets very special treatment in a box display, and across the piece there are around 27 mentions of Xi.
Anyway, let’s move to the full guideline on carbon peaking and carbon neutrality, which has been published on the page. This is a rare document because we have a simultaneous English publication too, available on Xinhua. I am going through the English version for a quick summary.
It says that achieving carbon peak and neutrality “is a major strategic decision...in light of both domestic and international imperatives. This is the natural choice for China to address acute resource and environmental constraints and achieve sustained development…” The guiding ideology section emphasises Xi Thought, along with the need to “strike a balance between development and emissions reduction, between overall and local imperatives, and between short-term and longer-term considerations.”
The Working Principles section highlights:
“Taking a whole-of-nation approach”...But it also says that “policies will be implemented on a categorized basis in light of local circumstance in order to encourage local authorities to act on their own initiative.”
Prioritising conservation: “We will continue to reduce energy and resource consumption and carbon emissions per unit of output, improve resource input-output efficiency.”
Leverage government and market
“In the international response to climate change, we need to be prepared to both stand our ground and engage in cooperation, continue to increase China’s influence and voice on the world stage, and resolutely safeguard our development rights and interests.”
“Efforts to reduce pollution and carbon emissions must be balanced with the need to ensure the security of energy, industrial chains, supply chains, and food, as well as normal daily life.”
In terms of goals,
by 2025, an initial framework will be in place.” Energy consumption per unit of GDP will be lowered by 13.5% from the 2020 level; carbon dioxide (CO2) emissions per unit of GDP will be lowered by 18% from the 2020 level; the share of non-fossil energy consumption will have reached around 20%; the forest coverage rate will have reached 24.1%, and the forest stock volume will have risen to 18 billion cubic meters.”
By 2030, CO2 emissions per unit of GDP will have dropped by more than 65% compared with the 2005 level; the share of non-fossil energy consumption will have reached around 25%, with the total installed capacity of wind power and solar power reaching over 1200 gigawatts; the forest coverage rate will have reached about 25%, and the forest stock volume will have reached 19 billion cubic meters. CO2 emissions will reach peak and stabilization and then decline.
By 2060, “China will have fully established a green, low-carbon and circular economy and a clean, low-carbon, safe and efficient energy system...the share of non-fossil energy consumption will be over 80%. China will be carbon neutral, and it will have achieved fruitful results in ecological civilization and reached a new level of harmony between humanity and nature.”
The next section talks about the pathways to get to these goals. It highlights the importance of incorporating carbon peak and neutrality goals as part of overall planning. It says that “stronger guidance and requirements on green and low-carbon development will be provided in the implementation of major regional development strategies.” And it talks about building societal consensus for “green and low-carbon development.”
The next section talks about optimizing industrial structure to meet these goals. It talks about promoting “green agricultural development;” says that implementation plans will be put together for industries like “energy, steel, non-ferrous metals, petrochemicals, building materials, transportation and construction;” and talks about “looking back” to looking back” to inspect steel and coal facilities that have cut overcapacity. The subsequent paragraph talks about “curbing irrational expansion of energy-intensive and high-emission projects.” In this, it mentions sectors like “steel, cement, flat glass, and electrolytic aluminum.” It also says:
“That the government will introduce production capacity control policies for coal-fired power, petrochemical, and coal-based chemical industries. Oil refinery operations not listed in national industrial plans will be prohibited from engaging in new construction, reconstruction, or expansion, and unlisted ethylene, paraxylene, and coal-to-olefins projects will be banned from engaging in new construction. We will keep production capacity for coal-to-liquids and coal-to-gas at an appropriate scale, raise the energy-consumption access standards for energy-intensive and high-emission projects, and enhance analysis, early warnings, and window guidance for overcapacity.”
The next paragraph talks about the need to “accelerate the development of strategic emerging industries in areas such as next-generation information technology, biotechnology, new energy, new materials, high-end equipment, new energy vehicles, environmental protection, aerospace, and marine equipment.”
The next bit talks about building a “clean, low-carbon, safe and efficient energy system.” In this regard, the document says:
“We will step up supervision and law enforcement of energy conservation, enhance analysis and early warning for energy consumption and CO2 emission control targets, and ensure strict responsibility implementation and performance evaluations.”
“We will improve the energy management system and strengthen management for major energy consumers and assign them stronger targets and responsibilities.”
“Coal-fired power will be developed in coordination with power supplies and peak shaving capacities, so as to strictly control coal-fired power generation projects...Scaled development of unconventional oil and gas resources such as shale gas, coal bed gas, and tight oil and gas will pick up pace.”
The next paragraph talks about increasing “the share of non-fossil energy in total energy consumption.” But there are no specific targets.
“We will carry out electricity price reforms with a view to promoting energy conservation, overhauling pricing structures for transmission and distribution, and lifting all pricing controls in competitive areas.”
The next section is about the transportation structure. It talks about developing new-energy and clean-energy vehicles and vessels, electrification of railways, and construction of hydrogen refuelling stations, along with raising the energy efficiency standards for fossil fuel vehicles and vessels and improving the energy efficiency labelling system for transportation vehicles and equipment.
The following section is about ensuring green urban and rural development. This talks about buildings and overall planning. The next section talks about strengthening R&D when it comes to cutting edge green technologies. Here, the document mentions areas like high-efficiency solar batteries, hydrogen production from renewable energy sources, controlled nuclear fusion, and zero-carbon industrial process reengineering. The next paragraph adds that “we need to develop smart grid technologies that can support the smooth, large-scale integration of wind and solar power into the grid. We must strengthen research and industrial application of advanced energy storage technologies such as electrochemistry and compressed air energy storage.”
Section 10 talks about a green BRI, control over exports of energy-intensive and high-emission products, and calls for expanding imports of “green and low-carbon products, environmental services, and services for energy conservation and environmental protection.” Section 11 relates to improving laws, regulations and monitoring. The following section then talks about financing and tax policies and use of market-based mechanisms. It says that:
“We will strictly control investment in high-carbon projects in areas such as coal-fired power, steel, electrolytic aluminum, cement, and petroleum chemicals production. We will increase support for projects concerning energy conservation and environment protection, new energy, low-carbon transportation modes and equipment, and carbon capture, utilization, and storage.”
It talks about “encouraging the participation of nongovernmental capital and motivate market entities to invest in green and low-carbon solutions.”
“We need to encourage development and policy-backed financial institutions to provide continued long-term funding support for the goals of carbon dioxide peaking and carbon neutrality through market-oriented and law-based means. We will support qualified enterprises in going public and refinancing for the purpose of developing and running green and low-carbon projects, and we will increase green bonds.”
“We will refine the standards for green government procurement and step up procurement…”
implementing “preferential tax policies for environment protection, energy and water conservation, new energy, and clean-energy vehicles and vessels.”
“We need to improve policies on differentiated electricity charges, time-of-use electricity pricing, and tiered pricing for household electricity consumption. Preferential electricity pricing must not be offered to energy-intensive, emission-intensive, or resource-consuming industries.”
“We need to accelerate the development of the national market for trading carbon emission permits by gradually expanding its coverage, diversifying trading types and means, and improving the allocation and management of allowances.
Moving on there’s also a commentary on the page about these guidelines, urging cadres and government to move towards carbon peak and neutrality goals. Then, we have a report telling us that the German edition of Xi’s book on building a community with a shared future for mankind has been published.
Finally, we have a piece that tells us that as per PBoC data the balance of inclusive small and micro loans in China was 18.6 trillion yuan, an increase of 27.4% year-on-year, which was 15.5 percentage points higher than the average growth rate of various loans. This has benefited over 40 million entities. The argument is that this is a product of policies that are seeking to support the “real economy.”
Page 2: Just one report to note. The State Council’s epidemic control team met the press to talk about the latest outbreak of COVID-19 in China. Mi Feng, NHC, said that “seasonal factors are likely to cause the spread of the virus as the epidemic continues to spread abroad. Since October 17, the epidemic has spread to many places in China, showing a trend of rapid development, affecting 11 provinces within a week.” He added that it is also important to reduce cross-regional gatherings and resolutely contain the spread of the epidemic.” Wu Liangyou, deputy director of the Disease Control and Prevention Bureau of the National Health Commission, said that the current outbreak was a product of the delta variant.
Adding to this with some inputs from Reuters’ reporting:
“Authorities have banned travel agencies from arranging cross-provincial tours that involve regions deemed of higher virus risk, and has imposed nationwide suspension on some travel services linking multiple tourist attractions. The capital Beijing has said it will impose strict restrictions on travel to the city by people who have been to counties with at least one infection. Health authorities also said on Sunday that about 75.6% of China’s population had received complete vaccine doses as of Oct. 23, or some 1.068 billion people.”
Page 3: Much of the page is dedicated to a long piece bylined Guo Jiping, written to commemorate the “50th anniversary of the restoration of China’s lawful seat in the United Nations.”
It says that over the past 50 years, the “collective rise of emerging markets and developing countries represented by China has greatly increased the power for safeguarding peace and development. China is firmly committed to upholding the international system with the United Nations at its core, the international order based on international law, and the central role of the United Nations in international affairs.” 以中国为代表的新兴市场国家和发展中国家群体性崛起，极大增加了维护和平与发展的力量。中国坚定维护以联合国为核心的国际体系，坚定维护以国际法为基础的国际秩序，坚定维护联合国在国际事务中的核心作用，并以自身发展书写了人类进步的传奇，为推进世界和平与发展事业作出越来越大的贡献.
Of course, this is accompanied by remarks about practicing “true multilateralism.” Anyway, the first part of the piece deals with history. We are told that the CPC sent its members to the San Francisco conference, and how Dong Biwu signed the Charter of the United Nations. However, the US and other Western nations “obstructed” and “excluded” the PRC from the UN eventually. And then there’s lots of excited rhetoric around Resolution 2758.
The next section talks about China’s international engagement, emphasizing that “‘any major international issue cannot be resolved without the participation of the People's Republic of China,’ a view that was expressed by representatives from Albania and other 17 countries to the United Nations in July 1971.” Under this framework, the piece plays up China’s peacekeeping efforts, economic engagement, BRI, South-South cooperation, etc. It adds that “China has always held true multilateralism banner, determined to maintain the UN as the core of the international system and international order on the basis of international law, determined to maintain the legitimate rights and interests of developing countries, will unswervingly for developing countries way-speaking up firmly push global governance system toward a more just and rational direction.” 中国始终高举真正的多边主义旗帜，坚定维护以联合国为核心的国际体系和以国际法为基础的国际秩序，坚定维护发展中国家的正当权益，坚定不移地为发展中国家仗义执言，坚定推动全球治理体系向着更加公正合理的方向发展.
The next section emphasises how under Xi, policies have helped frame the community of common destiny. This includes BRI and China’s COVID-19 diplomacy, etc. In this regard, the piece also talks about some countries still “clinging to Cold War mentality, and claiming to uphold the ‘rules-based international order’, trying to impose their own will and standards on others, and replace universally accepted international laws with rules formulated by a few countries. The fundamental difference between the two views on the international order lies in whether the destiny of the world should be in the hands of all countries, whether international rules should be observed by all countries, whether global affairs should be governed by all countries, and whether the fruits of development should be shared by all countries.” 但也有个别国家固守冷战思维，动辄声称维护“基于规则的国际秩序”，试图把自己的意志和标准强加于人，用少数国家制定的规则取代普遍接受的国际法则。两种国际秩序观的根本分歧在于，世界命运是否应该由各国共同掌握，国际规则是否应该由各国共同遵守，全球事务是否应该由各国共同治理，发展成果是否应该由各国共同分享.
Then we are told:
"There is only one system in the world, and that is the international system with the United Nations at its core. There is only one order, the international order based on international law. There is only one set of rules, the basic norms governing international relations based on the purposes and principles of the UN Charter. China’s clear answer to the question of the direction of the international order has added stability to the readjustment of the international relations system. Facing real challenges, we need courage and determination. China stresses the need to practice true multilateralism, opposes acts that undermine the international order and create confrontation and division under the banner of the so-called ‘rules’. China calls for adhering to the principle of win-win cooperation, dismantling the high walls that divide trade, investment and technology, and creating a development future that is inclusive and beneficial to all…” 习近平主席强调：“世界只有一个体系，就是以联合国为核心的国际体系。只有一个秩序，就是以国际法为基础的国际秩序。只有一套规则，就是以联合国宪章宗旨和原则为基础的国际关系基本准则。”中国对国际秩序发展方向性问题的清晰回答，给调整中的国际关系体系增添了稳定性力量。直面现实挑战，尤其需要勇气和定力。中国强调要践行真正的多边主义，反对打着所谓“规则”旗号破坏国际秩序、制造对抗和分裂的行径，要恪守互利共赢的合作观，拆除割裂贸易、投资、技术的高墙壁垒，营造包容普惠的发展前景.
Page 4: We have a piece by Liu He. He writs that “in the first three quarters of this year, China’s GDP grew by 9.8%, the added value of industrial production above designated size increased by 11.8%, total retail sales of consumer goods increased by 16.4%, and 95% of the annual target for creating urban jobs was achieved.” But “the pace of global economic recovery has slowed down since the third quarter due to repeated outbreaks, rising commodity prices and tight international shipping.” He argues that while there will be short-term fluctuations, “the trend of China's sustained economic recovery and high-quality development has not changed and will not change.”
He argues that “to study and assess China’s economy, we should not only pay attention to just actual data, but also maintain dialectical thinking and strategic focus, observe the general trend, plan for the overall situation and take a long-term view.” 研判中国经济，既要关注现实数据，更须保持辩证思维、战略定力，观大势、谋全局、看长远.
He then identifies key aspects on which one must base their confidence in the Chinese economy:
The fundamentals of sustained recovery and development
The advantage of a super-large market; for instance, a GDP of over 100 trillion yuan, more than 400 million people in the middle-income group, 146 million market entities, a complete industrial system, and a constantly improving business environment, etc.
Confidence comes from surging new growth drivers and momentum. Here he emphasises the role of innovation.
Other Stories:
On Page 10: We have a long piece by Xu Yousheng, deputy director of the United Front Work Department of the CPC Central Committee. I am not going through the full piece here, but just to note that he starts with the recent guideline on “strengthening and improving ideological and political work.” He says that it is important to follow Xi Thought, of course. He begins by talking about the importance of united front work in “strengthening the party's class base” and uniting people. But then he warns that:
“A small number of Western countries have spared no effort to contain and suppress China, and struggles in ethnic, religious and human rights fields have become more acute and complex. As China marches towards the second centenary goal, it is bound to encounter various risks, challenges and even tempests. Therefore, it is necessary to strengthen ideological and political work, give full play to the unique advantages of the political leadership of the United Front, do a good job of winning over, rallying and stabilizing people’s hearts, and constantly enhance the political, ideological, theoretical and emotional identity of the members of the united front to the CPC. In the new era, the United Front led by our Party has developed into an alliance of all socialist workers, builders of the socialist cause, patriots who support socialism, patriots who support the unification of the motherland and are committed to the great rejuvenation of the Chinese nation.” 少数西方国家不遗余力对我进行围堵打压，民族、宗教、人权等领域斗争更加尖锐复杂。我国正在向第二个百年奋斗目标进军，必然会遇到各种风险挑战甚至惊涛骇浪。这就需要加强思想政治工作，发挥统一战线政治引领的独特优势，做好争取人心、凝聚人心、稳固人心的工作，不断增进广大统一战线成员对中国共产党的政治认同、思想认同、理论认同、情感认同。在新时代，我们党领导的统一战线已经发展成为全体社会主义劳动者、社会主义事业的建设者、拥护社会主义的爱国者、拥护祖国统一和致力于中华民族伟大复兴的爱国者的联盟.
He later writes that “at present, the world is in a period of great development, great change and great adjustment. The COVID-19 pandemic has a wide and far-reaching impact, with various ideological cultures stirring each other, there are greater exchanges, confrontation is becoming increasingly frequent, and struggles in the ideological field are becoming sharp and complicated. In particular, as China’s economic system has undergone profound changes, its social structure has undergone profound changes, its interests have undergone profound adjustments, and its ideology has undergone profound changes, with members of the United Front becoming significantly more independent, selective, variable, and diverse in their perspectives. Under such circumstances, it is all the more important to raise the banner of the United Front, build consensus and strengthen the ideological and political work of the united front in the new era.” 当前，世界正处于大发展大变革大调整时期，新冠肺炎疫情影响广泛深远，各种思想文化相互激荡，交流交融交锋日益频繁，意识形态领域斗争尖锐复杂。特别是随着我国经济体制深刻变革、社会结构深刻变动、利益格局深刻调整、思想观念深刻变化，统一战线成员思想的独立性、选择性、多变性、差异性显著增强。越是在这种情况下，越要在统一战线举旗帜、增共识，越要加强新时代统一战线思想政治工作.
He argues that China stands in stark contrast to the “chaos” seen in the West, and calls for standing firm on path and system, etc.
Pages 12 and 13: We have the full text of the family education law and a piece addressing 10 questions about the Chinese economy.