Greening China's Belt and Road: Challenges for Environmental Law

Abstract

This paper focuses on the development of policies and laws concerning overseas investment activities by Chinese public-sector entities, state-owned enterprises and private sector entities within the context of the Belt and Road Initiative (BRI). The scale of Chinese investment and development activity under the BRI will inevitably have significant impacts on the environment of those countries, particularly where major infrastructure projects are proposed. The paper primarily addresses the question of the environmental laws and standards that should apply to investment initiatives and development activities in the host countries that have signed onto the BRI, and also how those standards might be implemented, especially in the light of the emerging Chinese concept of ‘ecological civilisation’ that is officially required to be taken into account in Belt and Road initiatives. These considerations are particularly important where the environmental standards in the host countries are lower than those of China. Environmental standards are also relevant with respect to China’s international commitments in implementing multilateral environmental agreements, and in relation to China’s commitment to the implementation of the Sustainable Development Goals (SDGs). The paper argues that, ideally, given the intended cooperative nature of the BRI as well as the need to respect the sovereignty of host countries, the responsibility for meeting the highest possible environmental standards should lie jointly with Chinese entities as well as with their counterparts in host countries. Experience so far indicates that there are many inconsistencies in the application of the relevant regulations and policies. Consequently, more work needs to be done with respect to the contents of the memoranda of understanding being signed between China and host countries, as well as to environmental law requirements that ought to be incorporated into the trade and investment contracts under the BRI.

Keywords: China, Belt and Road Initiative, investment, trade, infrastructure development, environmental law, environmental impact, sustainable development goals, ecological civilization, guidelines, policies, BRI, host countries

JEL Classification: K10, K30, K32