'Lucid waters, lush mountains' to global green push: China's ecological vision

Editor's note: Lu Jiajun is a researcher at the Academy of Financial Research and Zhejiang International Base for Science & Technology Exchange: Fintech and Big Data Analysis, and an assistant professor at Zhejiang University International Business School. Ben Shenglin is the dean and professor at Zhejiang University International Business School and director at Zhejiang International Base for Science & Technology Exchange: Fintech and Big Data Analysis. The article reflects the authors' opinions and not necessarily the views of CGTN.

With climate change and ecological degradation accelerating worldwide, the "Two Mountains" Theory has proven to be both prophetic and globally relevant. It not only charts China's unique path toward high-quality and sustainable development but also offers a systematic blueprint for all other resource-rich yet environmentally vulnerable developing countries seeking green transformation.

Rooted in reality: From local experiment to national strategy

The origins and enduring influence of the Two Mountains Theory are deeply rooted in hands-on governance and real-world challenges, rather than abstract theorizing. In the early 2000s, Yucun Village (Zhejiang Province) confronted a common dilemma: while mining and cement industries had fueled rapid economic expansion, they had also inflicted serious environmental damage. Guided by a forward-looking vision, the village made the bold decision to close polluting operations and focus on ecological restoration. The transformation was striking. By developing eco-tourism and green industries, Yucun not only revitalized its local economy but also proved that protecting the environment and pursuing prosperity can go hand in hand. In recent years, the village has welcomed over a million visitors annually, generating income and employment while preserving its natural landscape.

Yucun's experience quickly inspired similar shifts across the country. From the mountains of Guizhou to the grasslands of Inner Mongolia, local governments have adopted this model, illustrating how environmental priorities, once viewed as development obstacles, can become powerful drivers of innovation, resilience, and inclusive growth.

Strategic elevation: Ecological civilization as national priority

Since its introduction, the "Two Mountains" Theory has been progressively elevated to the core of China's national development strategy. Today, ecological civilization stands alongside economic, political, cultural, and social progress as a fundamental pillar of the country's long-term national priority.

Green development has been firmly embedded across key national agendas. The 15th Five-Year Plan sets a clear direction for deepening ecological progress and accelerating the shift toward green and low-carbon growth. To ensure effective implementation, the Central Committee for Ecological and Environmental Affairs was established, strengthening high-level coordination and oversight. These efforts reflect how environmental sustainability has been systematically woven into China's long-term vision, policy mechanisms, and institutional architecture.

Institutional innovation and policy implementation

Over the past two decades, the "Two Mountains" Theory has not only shaped China's ecological vision but also steered the country onto a path of high-quality, sustainable development. This principle, treating ecological well-being as equally important as economic development, has been systematically embedded into national governance through a series of pioneering reforms and policy innovations. Landmark initiatives such as the Ecological Conservation Redline policy, the launch of a national carbon market, and the adoption of "dual carbon goals," demonstrate the commitment to environmental improvement as a strategic priority in China. At the local level, governments across China have introduced a range of complementary measures, including establishing green finance pilot zones to channel capital toward low-carbon sectors, adopting biodiversity conservation frameworks, and restructuring industrial policies to reflect ecological priorities. Legislative breakthroughs, such as the Yangtze River Protection Law, the creation of a unified national park system, and ambitious reforestation programs in northern China, highlight the depth and breadth of this transformation.

The outcomes are concrete and far-reaching. China now leads the world in installed renewable energy capacity, operates one of the fastest-growing electric vehicle markets, and oversees the largest afforestation initiative globally. These achievements not only validate the economic and environmental feasibility of ecological civilization but also position China as a leading contributor to global sustainability efforts.

Financing the green transition: Green finance as a pillar

Achieving the vision of "lucid waters and lush mountains" also requires robust financial support. As a key enabler of ecological civilization, green finance has become an essential mechanism for translating the "Two Mountains" Theory into action. Over the past decade, China has built a comprehensive green finance framework that channels capital toward low-carbon, resource-efficient, and environmentally restorative activities. China now ranks among the world's largest issuers of green bonds, financing a broad spectrum of projects from clean transportation and renewable energy to ecological restoration and pollution control. Efforts to harmonize domestic standards with international green finance taxonomies are also accelerating, enhancing the credibility and attractiveness of Chinese green bonds in global markets. 

The People's Bank of China has played a leading role in integrating environmental considerations into the financial system. Banks are now incentivized to incorporate environmental risk into credit decisions, with favorable policies supporting green industries. As a result, the scale and scope of green credit have expanded significantly, especially in areas like clean energy, energy efficiency, and ecological agriculture. In addition, launched in 2021, China's national carbon market is already the largest in the world by trading volume. Initially covering the power sector, it is now expanding to high-emission industries such as steel, cement, and petrochemicals. Beyond its role in emissions compliance, the ETS serves as a market-based signal that guides investment toward low-carbon innovation and industrial upgrading.

These instruments form a financial ecosystem that aligns economic incentives with environmental goals and put into practice the essence of the "Two Mountains" Theory, which states that protecting nature and pursuing development can, and must, reinforce each other. By making ecological value visible in financial markets, China is turning "green mountains" into real "gold and silver mountains," not only symbolically but economically and institutionally.

A Chinese solution for global challenges

While rooted in China's own development experience, the "Two Mountains" Theory holds global resonance and offers a compelling alternative, particularly for developing nations facing the dilemma of pursuing economic growth without compromising ecological integrity. It recognizes that ecological wealth is not only an environmental good but a productive asset, one that can generate livelihoods, sustain growth, and enhance resilience. This perspective has informed China's approach to international cooperation. Through the Belt and Road Initiative, China has launched green development partnerships, supported renewable infrastructure projects, and promoted the adoption of green standards.

Moreover, the Global Development Initiative and the Global Civilization Initiative call for a shared commitment to ecological balance, fairness in climate governance, and respect for developmental diversity. In doing so, China underscores its willingness to share lessons from its ecological transformation without imposing a one-size-fits-all model.

Toward a shared, green and inclusive future

As the 20th anniversary of the "Two Mountains" Theory approaches, it marks not just a milestone, but a moment for reflection and renewed commitment. China's ecological journey continues to advance, with increasing emphasis on nature-based solutions, the valuation of ecological products, and the integration of environmental data into economic planning. At the same time, the world faces escalating climate risks and growing environmental inequality, which are the challenges that demand urgent and coordinated action. The "Two Mountains" Theory, as a result, offers a universal truth: that harmony between humanity and nature is not a choice, but a necessity for sustainable development.

China's experience provides three key lessons. First, green transformation requires a long-term vision, and market forces alone cannot deliver it. Second, sustainability must be rooted in local contexts, driven by large-scale participation. Third, ecological progress must be inseparable from social equity, ensuring that the benefits of green development are shared by all.

From the hills of Anji (Zhejiang Province) to the halls of the United Nations, the "Two Mountains" Theory reflects not only China's transformation, but also its growing contribution to global sustainability. The principle that "lucid waters and lush mountains are invaluable assets" stands as both a guiding vision and a practical path toward a greener, more inclusive future.