The Chinese government announced in its recent guide for greenhouse gas policies that it will launch the world’s largest carbon emission permit trading market.

Professor Wang Yi of the Chinese Academy of Sciences in Beijing said that carrying out the trading of carbon emission rights at the national level and making statement to the whole world indicated the serious attitude of the Chinese government toward the issue.

China has prepared for the carbon trading market for several years. It has studied how Europe and California carry out their carbon emission market. In 2013, China conducted the trial operation of the carbon emission trading market in 7 provinces and municipalities including Beijing and Shanghai. By the end of 2015, the market had covered more than 2000 companies. By September last year, the accumulative trading volume of CO2 has reached 120 million tons, equaling the accumulative turnover of 3.2 billion yuan (US$475.7 million).

According to the experts, the Chinese carbon emission trading market will not be perfect as soon as it is launched. The most important thing at present is to establish a market mechanism, then gradually learn in the market and improve it.

Xie Zhenhua, China’s special representative for climate change affairs, said at the 2017 annual meeting of the Paulson Institute that they would, in an easy-to-difficult order, gradually include China’s 8 key industries, namely, petrochemical, chemical industry, building materials, iron and steel, paper making, electricity, nonferrous metals and aviation in the carbon emission right trading market, striving to make the market basically perfect, open, transparent and active in transaction in 2020.

Xie added that China has basically fulfilled the blueprint of carbon reduction by 2050 and that the next step is to strengthen cooperation and exchange with other countries which are also seeking carbon reduction. China is also willing to continue to cooperate with the new administration of the U.S. in this field.

At the annual meeting, Henry Paulson, the former Minister of Finance of the U.S. who has been sparing no efforts in boosting China-US cooperation, also expressed that the cooperation could be at multiple levels, such as cooperation between countries, between cities, between state and province, and between enterprises. Now the new administration of the U.S. has just started and the cooperation between the two countries at different levels at this moment is very crucial.

“This is a very challenging task. China must advance steadily and shouldn’t fail. If China’s carbon emission permit trading market fail, it would be a heavy blow not only to China but also to the global carbon emission trading”, said Wang.