Weighing In: How Much Steel and Cement Go Into China’s Global Infrastructure Projects?

By Cecilia Springer, Hanjie Wang and Ali Hasanbeigi

When a new railway line connects cities in East Africa or a power plant starts operating in South Asia, many tons of steel and cement quietly shape the structures behind the contracts and headlines. These carbon-intensive materials form the physical backbone of infrastructure financed by China’s development finance institutions (DFIs).

Led by the China Development Bank (CDB) and the Export–Import Bank of China (CHEXIM), Chinese DFIs have become central players in global infrastructure development, unlocking infrastructure bottlenecks, increasing trade and improving infrastructure and energy access.

At the same time, large infrastructure projects face growing scrutiny for their environmental impacts. An underappreciated driver of impacts is the massive volumes of steel and cement—both carbon-intensive materials—used to build the projects. These materials are indispensable for roads, railways, bridges, ports and power plants, yet their production accounts for nearly one-fifth of global CO₂ emissions. China’s overseas infrastructure projects not only shape energy and transport systems, but also lock in long-term emissions through the embodied carbon of construction materials.

Steel and cement demand is expected to remain strong in developing economies, even as China’s domestic demand declines. Overseas infrastructure projects provide an important source of external demand in these sectors. The climate implications are significant: the way these materials are sourced today will shape emissions for decades to come. Against this backdrop, green procurement can be a powerful tool to reduce embodied emissions by embedding low-carbon requirements into the sourcing of cement and steel.

In a new report, we estimate the scale of steel and cement demand in key Chinese-financed transport and energy projects and quantify their embedded emissions. We then explore how green procurement—by setting low-carbon requirements for steel and cement—could meaningfully reduce those emissions and discuss practical pathways that would better align Chinese-financed infrastructure with global climate goals.

Cement

Using data from the China’s Overseas Development Finance Database, which covers loans signed between 2008 and 2024, we find that cement use in a subset of Chinese-financed energy and transport projects is associated with 2,452 kilotons (kt) of CO₂ emissions. The estimate assumes that all cement is sourced locally within the host country where the project is located, as is typical given that cement is heavy and typically costly to transport. Most of these emissions come from projects that are already completed (1,988 kt CO₂). Projects still under construction contribute 406 kt CO₂ and planned projects represent just 58 kt CO₂.

The emissions are highly concentrated geographically. Five countries (South Africa, Indonesia, Argentina, Ethiopia and Angola) are together responsible for roughly 977 kt CO₂, or 40 percent of the total. This shows that a small number of countries (and largely completed projects) drive a large share of cement-related embodied emissions, reflecting the slowdown in China’s new overseas development finance in recent years.

Steel

Steel tells a more complex story. Unlike cement, steel is traded more extensively, which means emissions can vary significantly depending on where it is produced. If all steel were produced domestically in host countries (with China supplying only those countries lacking local steel industries), emissions would total about 3,480 kt CO₂, compared with 4,772 kt CO₂ if all steel came from China, where steel production is very carbon-intensive.

Across various steel supply scenarios, one pattern persists: completed projects account for most embodied emissions, with over 2,900 kt CO₂ under the domestic case and more than 4,000 kt CO₂ under the Chinese-supply scenario. The same five countries appear at the top of the list but in a different order (Argentina, South Africa, Indonesia, Ethiopia and Angola). They make up about 62 percent of steel-related emissions under the domestic case.

These results underline that sourcing choices matter. Relying on Chinese steel could raise embodied emissions by 37 percent due to its higher carbon intensity relative to most other countries (Figure 1). Green procurement strategies that prioritize low-carbon steel could meaningfully reduce the carbon footprint of infrastructure projects.

Figure 1: CO₂ Emissions Associated with Steel Used in China’s Overseas Development Finance in Analyzed Energy and Transportation Sectors

What Difference Could Green Procurement Make?

Our estimates suggest the impact be substantial. Applying procurement standards that set CO₂ intensity thresholds could have reduced emissions in our sample by up to 1,758 kt CO₂ for cement and up to 3,579 kt CO₂ for steel (Chinese-sourced) under the most stringent standards.

Meanwhile, there is still room to act even though completed projects account for most of the current footprint. Applying green procurement policies to projects under construction and planning could still cut future emissions. Beyond direct savings, these policies would also create strong market signals for host-country producers to invest in low-carbon steel and cement production.

Looking Ahead

Implementing green procurement for cement and steel in China’s overseas infrastructure projects will not be easy. Governance gaps, limited data, higher costs of low-carbon materials and technology constraints pose real barriers. However, strong enablers can support adoption.

These include alignment with global green procurement policies; the leverage of Chinese DFIs and state-owned enterprises (SOEs) in driving supply chain shifts; capacity-building for host-country producers; partnerships to scale innovations such as limestone-calcined clay cement and hydrogen-based steel; and synergies with development goals such as lower energy costs, competitiveness and cleaner air.

Developing a green procurement framework is essential to reducing the carbon footprint of China’s global infrastructure projects. Our report provides recommendations for different institutions to move in that direction (see Table 1).

Table 1: Policy Recommendations for Green Procurement for China’s Overseas Development Finance

As China weighs the future of its overseas infrastructure strategy, clear procurement standards can help ensure that these investments carry less carbon weight and maintain competitiveness in increasingly climate-conscious markets. Doing so will also benefit host countries in building demand for green manufacturing and promoting climate-compatible development.

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