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Beijing - XINHUA
China's march toward low-carbon economy will be fraught with challenges, yet, it presents more opportunities than risks, according to HSBC.
The State Council, China's cabinet, released an integrated reform plan for promoting ecological progress on Monday.
In an effort to build a beautiful China and solve serious ecological and environmental problems, the plan outlined the necessity of improving the environment, the efficient use of resources, and more attention to be given to ensuring modernization is in harmony with nature.
"More taxes are on the horizon," said a HSBC report, predicting that an environmental resource tax, a groundwater resource tax and an environmental protection tax will be rolled out in the near future.
Chinese firms will take on more responsibility for their activities, and fines will be much more substantial, HSBC said.
For areas with high environmental risk, a compensation system for ecological damage, and a mandatory environmental pollution liability insurance will be set up, according to HSBC.
These fiscal measures will only work when the cost and tax rate accurately reflect the damage caused, which will make companies take environmental protection more seriously, HSBC said.
China's green transition means more opportunities for the financial market, HSBC said, adding that more green credit, which takes the environmental credentials of companies into account, and more green investment products will be developed.
The government will also encourage banks and enterprises to issue more green bonds, to establish green development funds that will support environmental management and ecological protection.
China will lower carbon dioxide emissions per unit of GDP by 60-65 percent from the 2005 level by 2030 and establish a 20 billion yuan (3 billion U.S. dollars) fund to help other developing countries combat climate change, according to a joint presidential statement issued on Friday during President Xi Jinping's state visit to the United States.
China regards the battle against climate change a major opportunity to accelerate its economic restructuring and achieve sustainable development,said the National Development and Reform Commission (NDRC), China's economic planner.
The government will put more focus on the green economy, improving industrial structure, promoting low-carbon energy consumption and encouraging carbon-emissions permit trading, the NDRC said.