Green philosophy guides low-carbon practices. Photo: Zhao Yuan/CSST

With the gradual promotion of China’s goal to reach carbon peaking by 2030 and carbon neutrality by 2060 (“dual carbon“ goals), advancing the green and low-carbon transformation of the traditional manufacturing industry is an important driving force for constructing a modern industrial system, and has become a key factor affecting the high-quality development of China’s economy.

China’s advantages

Promoting the low-carbon development of the manufacturing industry requires taking into account the industry’s unique characteristics and considering both domestic and international environmental factors and development status. The goal is to establish a modern industrial system and facilitate an orderly low-carbon transformation of the manufacturing industry. To achieve this, specific measures should focus on optimizing the energy structure and increasing the use of clean energy. Additionally, efforts should be made to optimize structure and promote technological advancements. By reducing carbon emission intensity and leveraging resource allocation and economies of scale, continuous progress can be made in promoting the low-carbon development of the manufacturing industry.

China possesses several advantages that contribute to the low-carbon development of the manufacturing industry. Strategic decisions made by the Party and the state have laid a solid foundation for this development. The scale advantage of China’s manufacturing industry provides crucial resource support, while the unprecedented changes in the world today offer new opportunities. The accumulation of human capital serves as an important talent guarantee, and promoting low-carbon consumption upgrades acts as a driving force from the demand side. Together, these factors propel the manufacturing industry towards a sustainable and low-carbon future.

Development approaches

The key to advancing the practical approaches of low-carbon development in the manufacturing industry lies in clarifying the acceptable costs to reap the benefits of such development, so as to effectively promote the low-carbon transformation of the manufacturing industry while minimizing costs.

A scientific evaluation index system for the low-carbon development of the manufacturing industry should be established. Specifically, we can establish an evaluation system based on indicators across four dimensions: foundation for low-carbon development (measuring carbon emissions and carbon productivity), low-carbon energy development (evaluating energy consumption, energy intensity and power consumption intensity), low-carbon industrial development (assessing energy structure and industrial energy consumption), and low-carbon social development (considering carbon emission reduction strategies, clean and efficient energy utilization, environmental technology research and development and promotion, and public participation in low-carbon actions). By establishing this indicator-based evaluation system, we can lay a solid foundation for accurately promoting the low-carbon development of the manufacturing industry.

To effectively promote the low-carbon development of the manufacturing industry, a well-executed top-level design is crucial, fostering a coordinated promotion among the government, the market, and enterprises. First, it is essential to develop a differentiated policy inventory system that facilitates the policy coordination for producers and consumers, taking into account variations in carbon emissions, industrial structure, and resource endowments across different regions. Additionally, optimization plans should be formulated to continuously enhance the content and selection of policy lists, promoting dynamic system adjustments. Second, by conducting cost/benefit analyses of the low-carbon development of the manufacturing industry, the effectiveness of the policy list system in different application scenarios can be clarified. This will provide a reliable framework for selecting implementation entities across multiple dimensions, ensuring a more targeted approach to the design, optimization, and selection of the policy list.

In order to provide financial support for the low-carbon development of manufacturing enterprises, it is crucial to actively pursue low-carbon innovation investment. First, exploring the establishment of specialized support funds can guide the low-carbon transformation of manufacturing enterprises, taking into account their unique characteristics. Second, increasing financial and tax support for the low-carbon development of manufacturing enterprises, particularly those with substantial assets, can effectively reduce sunk costs. Third, promoting green finance is essential to enhancing credit support for the low-carbon transformation of manufacturing enterprises. This can be achieved by diversifying green finance products based on the industrial characteristics and transformation stages of different enterprises, ultimately reducing the financing costs required for their low-carbon transformation.

It is crucial to promote the green and low-carbon transformation and upgrading of the consumption structure, cultivating a green and low-carbon lifestyle. This can be achieved through various measures. First, increasing investment in green infrastructure projects such as public transportation and low-carbon parks can guide the transformation of residents’ consumption and lifestyle towards green and low-carbon practices. Second, improving the green product standard system and enhancing channels for disseminating information about green products can optimize the transmission of green product information. Additionally, establishing a robust green product quality assurance system and advocating for green and low-carbon concepts can continuously enhance the general population’s preferences for green and low-carbon consumption. Third, a policy support system that promotes green and low-carbon consumption should be established. This can be achieved by implementing a combination of consumption incentives, behavior constraints, and information transmission policies tailored to the characteristics of key consumption areas.

It is crucial to give timely attention to and integrate with the evolving global industrial competition landscape. This involves identifying the shortcomings and bottlenecks in China’s low-carbon development within the manufacturing industry, determining the optimal direction for its progress. Additionally, exploring the scale, structure, and contribution of key industries is essential. By doing so, China can enhance its adaptability to effectively address the complex ever-changing challenges posed by the international environment.

Han Chao and Liu Zhinan are from the Research Center of Industrial Organization and Enterprise Organization at Dongbei University of Finance and Economics.