China's green drive to create new investment opportunities

China's low-carbon transition drive will bring significant changes to investment philosophy in the financial market and create new investment opportunities, analysts said.

Amid the country's push to peak its carbon dioxide emissions by 2030 and achieve carbon neutrality by 2060, traditional energy, new energy and green finance could be promising targets for investment, said Mu Yiling, chief strategist of Kaiyuan Securities.

Explaining why traditional energy industry is worth following, he said, "As China moves toward a low-carbon economy, it will cut the supply of traditional energy. The reduction will inevitably lead to the shortage of energy supply, as evidenced by the recent price spike in raw materials such as coal and steel.

"The building of a new, low-carbon energy system cannot be achieved by fully replacing traditional energy in the short term. With less supply, traditional energy could see larger demand within the next 10 years," he told a forum co-organized by Ping An Group and 21st Century Business Herald in Shenzhen.

In financial industry, meanwhile, green credits, bonds, stocks and carbon finance will embrace robust growth, Mu said.

He added that the country's pace of developing green finance to fuel its carbon neutrality drive is accelerating, as related work, from top-level design to detailed rules and regulations, have gradually been put in place.

According to a recent report by the People's Bank of China, the central bank, the balance of China's green loans in local and foreign currencies increased 26.5 percent yearly to 14 trillion yuan ($2.2 trillion) as of the end of June. Issuance of green bonds surged 152 percent year-on-year to exceed 350 billion yuan in the first eight months.

Fan Feilong, deputy general manager of Ping An Capital, said China's ambitious objective to achieve carbon neutrality will force industries to speed up transformation and upgrade.

"In this process, a large number of technological breakthroughs are expected to be made, promoting our capability in original technological innovation. Also, a number of new industry leaders are expected to emerge," he said.

Fan forecast that more capital will be poured into high-tech enterprises with new technologies or innovative models.