At the opening ceremony of the third Belt and Road International Cooperation Summit Forum held in Beijing on October 18, a series of significant measures were announced, illustrating China’s commitment to supporting the high-quality development of the Belt and Road Initiative.
During his keynote address at the forum, President Xi Jinping announced that China would comprehensively remove foreign investment access restrictions in the manufacturing sector.
In the context of supporting the construction of an open world economy, China will create “Silk Road e-commerce” cooperation pilot zones with more countries to sign free trade agreements and investment protection agreements. Furthermore, China will completely lift foreign investment access restrictions in the manufacturing sector.
China is proactively aligning itself with international high-standard economic and trade rules, advancing cross-border trade in services and high-level investment openness, expanding market access for digital products, and deepening reforms in areas such as state-owned enterprises, the digital economy, intellectual property, government procurement, and hosting the annual “Global Digital Trade Expo.”
These actions are expected to drive China’s merchandise trade and service trade to reach $32 trillion and $5 trillion, respectively, within the next five years. These policy initiatives underscore China’s strong commitment to economic openness and global cooperation.
The Belt and Road Initiative Fuels Global Energy Transformation, Benefiting Billions Worldwide
Over the past decade, the Belt and Road Initiative has made a significant contribution to global green development and is set to become a major force driving global energy transformation.
In the coming years, China will play a central role in advancing this global energy transition. China is the source of over 70% of the world’s photovoltaic panels, reflecting its leading position in the field of renewable energy and providing valuable learning opportunities for other nations.
As the impacts of climate change begin to affect every continent on Earth, countries worldwide should collectively expedite this transition.
In 2020, China set a goal of reaching 1,200 gigawatts of solar and wind power capacity by 2030. This goal appears achievable well before 2025. In just one year, China is expected to deploy 60 gigawatts of wind energy and 100 gigawatts of solar energy, with these figures projected to continue growing rapidly each year.
The International Energy Agency reports that China produces over 80% of the world’s solar panels and accounts for half of the global wind power capacity added in 2022. The cost of renewable energy generation continues to decrease and, in many cases, is already lower than fossil fuel power generation. Other technologies required for energy transition, such as batteries and electric vehicles, are also experiencing cost reductions.
China’s progress in renewable energy technology is timely. The global average temperature has already risen 1.2 degrees Celsius above pre-industrial levels, and in July of this year, global warming temporarily exceeded the critical threshold of 1.5 degrees Celsius. Catastrophic heatwaves, wildfires, hurricanes, floods, and droughts have far exceeded historical levels worldwide.
At the recent United Nations Climate Action Summit in New York, UN Secretary-General António Guterres stated, “We are on the verge of the abyss.” Predictions suggest that the degree of climate warming will intensify in the coming decades. Therefore, the immediate cessation of fossil fuel burning to mitigate climate change remains the most critical, safest, and cost-effective action to address the climate crisis.
Global Energy Transformation Still Faces Formidable Challenges
However, transforming China’s technological and manufacturing capabilities into a catalyst for a faster global energy transition still faces substantial challenges. On one hand, many developing countries are burdened with high debt after the COVID-19 pandemic, exerting significant economic pressure.
On the other hand, the instability of renewable energy electricity production makes integration into power grids difficult, necessitating efficient energy storage solutions and advanced grid planning and management.
Additionally, renewable energy projects are often perceived as riskier than traditional fossil fuel projects, which can lead to higher financing costs due to outdated reasons. Exchange rate risks further exacerbate this situation, especially for developing countries.
Most significantly, fossil fuel companies are deeply entrenched and often have long-term power purchase agreements. Accelerating the transition requires collective efforts from all parties. China, Belt and Road Initiative partner countries, as well as other developed nations, can play pivotal roles in this regard.
Continuing Global Expansion and Focusing on Belt and Road Initiative’s International Market Expansion
As global demand for lithium batteries continues to rise, Chinese companies are actively expanding into international markets. They invest significant resources annually in research and development, innovating a wide array of products tailored to market needs in the field of lithium battery technology.
The growth of the lithium battery industry is explosive in recent years. For example, in the charging infrastructure for lithium batteries, it is projected by Zhongtai Securities that by 2027, the incremental space for overseas new energy vehicle charging equipment will reach approximately RMB 75.9 billion, with expected market spaces of RMB 28.4 billion in the United States and RMB 33.5 billion in Europe.
Countries involved in the Belt and Road Initiative can both purchase high-quality and cost-effective Chinese products and establish channels to sell their distinctive products in China, achieving mutual benefit. Today, empowered by smart technologies such as artificial intelligence, blockchain, the Internet of Things, and digital twins, products like electric passenger vehicles, lithium-ion batteries, and solar panels have become new highlights of China’s foreign trade exports.