By Abbas Nazil
Chinese companies are investing hundreds of billions of dollars in clean energy manufacturing abroad, helping to cut global emissions while also triggering serious environmental, social and human rights concerns in host countries.
Since 2022, Chinese firms have pledged about $200 billion for overseas factories producing electric vehicles, batteries, solar panels and related technologies, according to the Net Zero Industrial Policy Lab at Johns Hopkins University.
These investments are playing a growing role in the global energy transition, with Chinese clean energy exports reducing emissions outside China by about 1 percent in 2024 alone.
Hungary has emerged as one of the biggest beneficiaries, attracting around $17 billion in Chinese-backed electric vehicle and battery projects as Prime Minister Viktor Orbán seeks to turn the country into a European battery manufacturing hub.
Outside the city of Debrecen, Chinese battery giant CATL is nearing completion of what could become one of Europe’s largest electric vehicle battery factories.
The industrial park hosting the project also includes other battery-related plants, several owned by Chinese firms, transforming what was recently farmland into a dense manufacturing zone.
While the factories could support Europe’s shift away from fossil fuels, they have sparked intense opposition from residents concerned about pollution, water shortages and public health risks.
Local activists warn that battery production requires large volumes of water and energy and involves hazardous chemicals that could threaten nearby communities.
Debrecen has already faced drought conditions, and experts have cautioned that groundwater supplies could reach their limits as industrial demand increases.
Residents also fear exposure to chemicals such as N-methyl-2-pyrrolidone, which the European Union says may harm fetal development.
Environmental groups have documented spills, air pollution incidents and wastewater contamination linked to battery-related plants in Hungary and elsewhere.
Chinese-backed projects around the world have similarly raised alarms, with mines, dams and factories accused of polluting waterways, damaging ecosystems and violating labor rights.
In some countries, journalists and activists investigating these projects have reported intimidation, surveillance and political pressure.
Chinese officials reject allegations of abuse, saying overseas investments under the Belt and Road Initiative aim to support green growth, poverty reduction and mutual benefit.
Experts note that China’s massive state-backed investment in clean energy has helped make technologies cheaper and more accessible globally.
At the same time, civil society groups argue that weak regulation and fast-tracked permits in host countries often leave communities vulnerable to environmental harm.
In Hungary, critics say the government’s centralized decision-making has limited public input and oversight over major battery projects.
Despite growing protests and public concern, construction continues at a rapid pace as authorities emphasize economic growth and industrial leadership.
Analysts say the ultimate impact of Chinese clean energy investments will depend on how host governments enforce environmental standards and protect workers and communities.
They argue that countries receiving these investments must negotiate stronger safeguards to ensure that climate benefits do not come at the cost of human rights and environmental health.