Fitch Ratings expects China’s green finance market to be an important tool for policymakers to achieve the country’s pledge to reach net-zero carbon emissions by 2060. New policies and incentives have continued to emerge despite the coronavirus pandemic, with financial regulators setting policy goals to address climate change through investment and financing in China's next Five-Year Plan. More initiatives are on the horizon as policymakers take the lessons learnt from regional green-finance pilot schemes to construct a national framework. The onshore green bond market currently operates on local guidelines that have some differences from commonly accepted global standards, such as the eligibility of certain projects and the percentage of proceeds allowed to be allocated to general working capital. The latest green bond guidelines issued by the People's Bank of China (PBOC) in 2020 have reduced the gap with international standards on eligible projects, and we expect the desire to open the onshore market to foreign investors to drive further standardisation. However, Fitch expects divergences with international standards in new areas, such as transition bonds and sustainability-linked instruments, even as other standards converge.