State Administration of Foreign Exchange launches pilot program for green foreign debt business, encourages non-financial enterprises to use cross-border financing funds for green or low-carbon transformation projects.

Recently, the State Administration of Foreign Exchange decided to launch a pilot program for green external debt business in 16 provinces and cities including Shanghai, Beijing, Tianjin, Hebei, Jiangsu, Zhejiang, Anhui, Fujian, Shandong, Hubei, Guangdong, Sichuan, Ningbo, Xiamen, Qingdao, and Shenzhen. The program encourages non-financial enterprises to use cross-border financing funds for green or low-carbon transformation projects. The pilot policy mainly targets domestic non-financial enterprises that bring in funds from non-residents in both local and foreign currencies, specifically for supporting green or low-carbon transformation projects that meet the relevant regulations of the People's Bank of China and other departments. These projects are allowed to have less impact on the enterprise's overall cross-border financing risk-weighted balance, thereby increasing the maximum limit of cross-border financing for investment in green development or low-carbon transformation projects. Additionally, the registration of related external debt will be handled directly by banks, enhancing the convenience of green external debt business handling and attracting global financial resources to orderly gather in fields such as China's green and low-carbon development. In the next steps, the State Administration of Foreign Exchange will better coordinate between openness and security, continuously improve the facilitation of cross-border financing, support the implementation of the five major financial tasks, and better serve the high-quality development of the real economy.