The Information Office of Shandong Provincial Government convened a press conference, at which it interpreted the Measures on Provision of Financial Supports for Eco-environmental Protection and Development of the Eco-environmental Protection Industry (hereinafter referred to as the Measures) that was recently enacted. Shandong Province will give full play to the finance’s resource allocation function to support its green development, as well as channel and encourage more financial resources to support eco-environmental protection and development of the eco-environmental protection industry. It is learned that as China’s first provincial-level financial support policy enacted specially for the eco-environmental protection sector, the Measures will keep injecting green new energy into Shandong Province’s eco-environmental protection and development of the eco-environmental protection industry.

Recently, Jinan Branch of the People’s Bank of China, together with Shandong Provincial Department of Ecology and Environment, took the lead in working with relevant departments such as Shandong Provincial Department of Finance, Shandong Provincial Financial Supervision and Administration, and Shandong Supervisory Bureau of China Banking and Insurance Regulatory Commission to jointly issue the Measures, in which 17 specific measures have been brought forth to support eco-environmental protection and development of the eco-environmental protection industry in six major aspects including establishment of promotion mechanism, effectiveness tracking work, increased efforts in financial supports, innovative financial support models, intensified coordination among the government, banks, and enterprises, and stress on publicity and monitoring.  

According to the Measures, Shandong Province will build provincial-level promotion mechanism, and it plans to establish Shandong Province Financial Project Pool for Environmental Protection by the end of March 2022. Meanwhile, all cities of Shandong Province will be encouraged to establish municipal-level financial project pool for environmental protection, and projects in the pool will be pushed to financial institutions at regular intervals, and viewed as important reference for green financing subject’s credit line and qualification for enjoying preferential policies. By establishing Shandong Province Expert Pool for the Eco-environmental Protection Industry, Shandong Province provides expert counselling service and think thank support for project incoming audit, green project certification, and climate investment and financing, etc.  

To intensify the support via financial policy, Jinan Branch of the People’s Bank of China earmarked CNY 10 billion for re-loan, encouraged local corporate banks to increase the supply of green loans, and stressed provision of loans to carbon emission reduction and carbon sink sectors, etc.

In addition, Jinan Branch of the People’s Bank of China and Shandong Provincial Department of Ecology and Environment jointly issued the Administrative Measures of Shandong Province for Guiding the Carbon Emission Reduction via Rediscount, which, as an ancillary incentive policy for the Measures, earmarked CNY 50 billion for guiding the carbon emission reduction via rediscount. Where the enterprises involved in Shandong Province Financial Project Pool for Environmental Protection transact the rediscount for the notes they issue, accept, or hold, the notes, on presentation, will be discounted within the specified amount. Branches of the People’s Bank of China are responsible for setting the green channel and simplifying the operation process. In principle, rediscount process shall be completed within 24 hours as from the work day when the paper-based application document is received.   

The Measures points out that by the end of 2021, Shandong Province will set up Shandong Province Soil Pollution Prevention and Control Fund, in order to intensify the green development fund’s support to development of the eco-environmental protection industry, and increase the supports to eco-environmental protection governance models, such as environmental protection butler, environmental hospital, pilot implementation of Ecology-oriented Development (EOD) model, and pilot implementation of custodian service model for comprehensive governance of environment, etc.

The Measures requires that financial assistance shall be provided to all environmental protection enterprises included in statistics and survey of the eco-environmental protection industry. So far, 991 environmental protection enterprises have been included in the financial assistance scope of Shandong Provincial Financial Supervision and Administration, among which 105 enterprises raised funds of CNY 1.989 billion in total.

In light of the Measures, financial institutions will be organized to precisely match green and environmental protection enterprises, in order to give play to counseling service function of the institutions such as Green Finance Research Institute. In addition, an enterprise’s environment credit evaluation information and disclosure of environmental information in conformity with laws will be taken as an important reference for the enterprise’s credit line, and those enterprises which employ trickery for the loan or misappropriate the support funds for other purposes will be excluded from the Financial Project Pool for Environmental Protection.