As China prepares its 15th Five-Year Plan (2026-30), the country’s green transformation is speeding up. The next five years will be decisive in achieving the country’s dual-carbon goals and turning it into an advanced, competitive, and globally connected low-carbon economy. Within this journey, the Hong Kong Special Administrative Region’s unique position as an international financial hub, innovation bridge, and rule-making interface gives it a pivotal role in supporting the nation’s sustainable transition.
China’s low-carbon transition has entered a new phase — no longer only emphasizing ecological benefits but also economic and technological development. The country leads the world in renewable-energy deployment, electric-vehicle sales, and green-technology patents. To turn these quantitative strengths into qualitative advancement, China must deepen institutional innovation, international collaboration, and global standard-setting — areas in which the SAR can act as an accelerator.
Hong Kong stands at the intersection of three complementary strengths: an open international system that channels global capital and expertise; a powerful mainland hinterland, offering industrial scale and policy depth; and close integration into the Guangdong-Hong Kong-Macao Greater Bay Area, now a test bed for green technologies and sustainable urban development.
These combined advantages make Hong Kong not just a symbol in China’s green narrative but a strategic lever amplifying national progress. Its mature financial infrastructure, renowned legal system, competent professional services, and international engagement — when integrated with the mainland’s technological and industrial capabilities — will enable the city to evolve from a “connector” to a genuine “catalyst” of the nation’s green transformation.
Technology lies at the heart of green competitiveness. While Hong Kong’s traditional strength has been finance, its future relevance will hinge on nurturing and commercializing innovation. The Greater Bay Area provides the ideal platform for such integration. Shenzhen has issued a 2024-25 hydrogen-energy action plan and is piloting refueling and industrial projects, while China Southern Power Grid is expanding pumped-hydro and new-energy-storage systems, including compressed-air and electrochemical solutions. Across China, large carbon-capture, utilization and storage demonstrations — such as the Ningdong project in Ningxia — are under construction, with research identifying Northeast and Northwest China as priority regions for deployment.
These initiatives share a common challenge: scaling up from laboratory to market. They require international financing, intellectual-property protection, certification, and third-party auditing — precisely Hong Kong’s areas of comparative strength.
By bridging mainland and international frameworks, Hong Kong helps mainland enterprises meet both domestic and overseas investor expectations, enhancing the country’s voice in global sustainable-finance governance. Green transformation is the core thread of China’s high-quality development. Situated between global capital and national innovation, Hong Kong is uniquely placed to help turn that vision into reality
By creating a green-technology corridor linking Hong Kong and the Greater Bay Area partner cities, research, pilot testing, mass manufacturing and global commercialization can be seamlessly connected: Hong Kong anchors research partnerships with global institutions, manages IP protection, and provides testing, certification, and green financing; partner cities such as Shenzhen, Foshan and Dongguan focus on industrial pilots and large-scale production.
This collaboration would accelerate commercialization of Chinese green technologies, bolster technological self-reliance, and strengthen China’s contribution to global climate innovation.
Hong Kong has established itself as one of the world’s foremost centers for green and sustainable finance. In 2024, total green and sustainable debt issued in the city reached $84.4 billion, including $43.1 billion of bonds arranged in the city (up 61 percent year-on-year). By August 2024, the HKSAR government had issued around HK$220 billion ($28 billion) in green bonds under its own program, demonstrating public-sector leadership.
In the next stage, competitiveness will depend less on issuance volume and more on product diversity, capital efficiency, and innovation. Hong Kong can broaden its product suite, developing transition bonds, sustainability-linked loans, and blended-finance vehicles that attract both public and private capital; expand cross-border applications, enabling Greater Bay Area projects in hydrogen, offshore wind, and circular manufacturing to tap offshore financing via Hong Kong; and advance digital-finance innovation, using blockchain and tokenization to improve transparency and traceability of ESG data.
Compared with London and Singapore — the former renowned for regulatory disclosure and the latter for regional project pipelines — Hong Kong can serve as Asia’s “third pole” of sustainable finance, combining renminbi liquidity, global investor access, and an emerging derivatives market for green and carbon assets.
China’s national emissions-trading program (ETP) is expanding beyond the power sector to include steel, cement and aluminum. On March 26, the Ministry of Ecology and Environment announced the plan, adding about 1,500 enterprises and raising coverage to around 60 percent of national emissions, with first compliance due by the end of 2025.
Hong Kong’s Core Climate platform, launched by Hong Kong Exchanges and Clearing Ltd, already provides a voluntary-credit trading venue in both Hong Kong dollars and renminbi. Participation has grown to over 100. Looking ahead, the platform is exploring the potential to enroll credits issued under China’s national systems — a move that would strengthen the city’s role as a gateway between the mainland’s compliance markets and global investors. Building on this foundation, Hong Kong can create a cross-border carbon-asset custody and settlement center; explore carbon-market connectivity within the Greater Bay Area, laying the groundwork for future linkage between China’s ETP and global markets; and develop carbon-finance innovation, including carbon-backed loans, derivatives, and RMB-denominated carbon instruments, transforming carbon from a compliance cost into a market asset.
Through these steps, Hong Kong could become a gateway for international investors to access the mainland’s carbon assets and strengthen the nation’s voice in global carbon-pricing governance.
As green cooperation under the Belt and Road Initiative deepens, Hong Kong’s role as an international service hub becomes ever more relevant. Many partner economies are advancing renewable-energy and infrastructure projects that require bankable, ESG-aligned finance. Hong Kong can serve as a system integrator by providing sustainable-finance structuring (syndicated green loans, risk-mitigation tools); legal and dispute-resolution services under its common-law system; ESG disclosure and assurance aligned with global standards; and capacity-building partnerships with multilateral and mainland institutions.
By helping the mainland’s green technologies and enterprises “go global”, Hong Kong not only advances the national strategy but also contributes to the international diffusion of sustainable governance standards.
Long-term competitiveness depends on human capital and institutional design. Demand for professionals in ESG reporting, carbon accounting and sustainable finance is surging across Asia. Hong Kong can strengthen its foundation by establishing an Asian ESG certification and training center, aligned with ISSB and IFRS S2 standards; green-finance qualification programs, developed with global bodies such as the CFA Institute and UN PRI; and university-industry partnerships on data analytics, climate risk and sustainable investment.
Such initiatives would position Hong Kong as a regional hub for green talent and soft power in sustainability governance.
The 15th Five-Year Plan seeks to balance domestic transformation with global integration. As the country refines its green taxonomy and ESG disclosure system, Hong Kong can act as a policy sandbox for alignment. Its regulators — members of the International Platform on Sustainable Finance — cooperate closely with the People’s Bank of China and the Ministry of Ecology and Environment on taxonomy harmonization. The Hong Kong Monetary Authority’s 2024 Taxonomy and HKEX’s IFRS S2-based climate-disclosure rules (from the 2025 reporting year, phased to full ISSB adoption by 2028) make the city a testing ground for global best practice.
By bridging mainland and international frameworks, Hong Kong helps mainland enterprises meet both domestic and overseas investor expectations, enhancing the country’s voice in global sustainable-finance governance.
Green transformation is the core thread of China’s high-quality development. Situated between global capital and national innovation, Hong Kong is uniquely placed to help turn that vision into reality.
The author is director of research at the Institute of Innovative and High-Quality Development (Hong Kong).
The views do not necessarily reflect those of China Daily.
