China will not build new coal-fire projects abroad, a move that could be pivotal in tackling global emissions.
President Xi Jinping made the announcement in his address at the United Nations General Assembly.
China has been funding coal projects in countries like Indonesia and Vietnam under a massive infrastructure project known as the Belt and Road initiative.
But it has been under pressure to end the financing, as the world tries to meet Paris climate agreement targets.
“China will step up support for other developing countries in developing green and low-carbon energy, and will not build new coal-fired power projects abroad,” Mr Xi said in a video recording at the annual summit.
No further details were provided, but the move could limit the expansion of coal plants in many developing countries under China’s Belt and Road Initiative (BRI).
The BRI has seen China fund trains, roads, ports and coal plants in numerous countries, many of them developing nations. For the first time in several years however, it did not fund any coal projects in the first half of 2021.
China is also the world’s largest greenhouse gas emitter and is heavily reliant on coal for domestic energy needs.
Mr Xi mentioned promises made last year about China achieving peak emissions before 2030 and then transitioning to carbon neutrality by 2060.
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The US Climate Envoy John Kerry welcomed the announcement, saying in a statement that he was “absolutely delighted to hear that President Xi has made this important decision”.
The head of the COP26 United Nations Climate Change Conference due to be held in Scotland next month also applauded the news.
“It is clear the writing is on the wall for coal power. I welcome President Xi’s commitment to stop building new coal projects abroad – a key topic of my discussions during my visit to China,” Alok Sharma said on Twitter.