Green Silk Road and Belt Economic Initiative and Local Sustainable Development: Through the Lens of China’s Clean Energy Investment in Central Asia

Abstract

This paper examines how China’s renewable energy investment contributes to the Central Asian countries’ GHG emission reduction target to meet their global climate commitments and the United Nations 2030 Sustainable Development Goals (SDGs2030).  The introduction analyzes what problems have emerged in China’s Green Silk Road and Belt Economic Initiative (SRBI) and how global climate change is viewed to affect sustainable energy transition in the Central Asian countries. The paper will then focus on what response in national energy structures have been adopted by Central Asian countries to address global climate change commitments. The main focus of this paper is on how China’s renewable energy investment in Central Asia contributes to solving essential problems for sustainable energy transition, bridging technical gaps and financial barriers for the low-carbon sustainable energy transition and aligning with the Paris agreement to fulfill global climate commitments. The limited institutional capacity and market failure in renewable policy ecosystems in Central Asian countries jeopardizes domestic climate investment and China’s renewable investment potential, increasing national spending for sustainable development transition and triggering huge fiscal deficit and debt crises. This endogenous systemic risk deteriorates financial and technical barriers. This requires regional and multilateral renewables coordination and climate cooperation. China needs to set up a comprehensive green policy for the Central Asian countries to get full support from local and international society. PPP and multilateral cooperation in the international renewables investment have not only mobilized more climate financial resources but also mitigate and diversify market failure risk.