China is among the largest producers of emissions in the world. Earlier, the country promised to limit funding on projects that are highly polluting the environment. The promise will surely help the environment, but it has isolated Japan. It has also increased pressure to close a deal to phase out coal export subsidies.

The issue is part of discussion of Organisation for Economic Cooperation and Development (OECD), an international economic organisation of more than 30 countries, since 2014. Japan is at the front of opposition to phase out coal export subsidies.

On Friday, the communist nation in East Asia said in a joint statement with the US that it has decided to take similar steps to those already promised by the US, the World Bank and some others to deal with the issue of coal financing.

Reacting to China's change of stance, a climate change adviser to the Japanese government, Mutsuyoshi Nishimura, said it will be little difficult for Japan to export coal technologies.

In the statement on Climate Change, China announced it will work on strengthening green and low-carbon policies with an aim to deal with public investment in project with high carbon emissions.

Talking about condition of anonymity, officials of the European Union said, “The statement needed to be clarified, but should inject momentum into negotiations that resume in Paris at the OECD on November 16”. Previous coal talks of OECD had ended in stalemate at the start of this month.

"It is an important signal that China is part of an international community of investors that is trying to move in a cooperative way," she said.

"It would be perverse for a country to use their development finance to invest in things that are not moving toward a lower-carbon trajectory."