World
China-Europe-America collaboration is essential for global carbon neutrality
By Ma Xiaowen  ·  2021-12-24  ·   Source: NO.52 DECEMBER 30, 2021
A photo taken on November 24, 2020, shows the China-invested 246-mW Tatay River Hydropower Plant. The plant, located in Thma Bang District of Cambodia, provides clean energy to local people and industries (XINHUA)

"Environmental challenges are not figments of our imagination, but a key issue of mankind's future," Laurent Fabius, former French Prime Minister and one of the leaders who helped turn the 2015 Paris UN Climate Change Conference into a success via the Paris Agreement, said when pointing out what is at stake during a recent webinar.

Acknowledging the urgent need for solid actions tackling climate change, the webinar highlighted the importance of partnerships between governments, the private sector and civil society and the significance of synergy between China, Europe and the United States. Known as the first dialogue of the China-Europe-America Net-Zero Transition Platform, it took place on December 20, two months after the 26th UN Climate Change Conference (COP26) in Glasgow of the United Kingdom, which adopted the Glasgow Climate Pact.

The pact clarifies that the sum of national pledges is insufficient for the globe to escape 2 degrees Celsius of warming, let alone reach the 1.5 degrees Celsius considered preferable in the Paris Agreement that went into force in 2016. Therefore, every country is requested to toughen its goals and strengthen its commitment over the next year.

Fabius stressed that efforts should focus on the near future, particularly on the next UN climate change conferences, because climate action is a race against time. He added that the status quo is not a cause for pessimism but, on the contrary, a call for more ambitious and urgent actions.

Restoring faith 

The webinar called on all parties to accelerate their actions in line with the goals of the Paris Agreement and the United Nations Framework Convention on Climate Change.

David Gosset, a co-organizer of the dialogue, deemed the joint efforts of China, Europe, and the U.S. crucial to the implementation of the Glasgow Climate Pact. Also founder of the China-Europe-America Global Initiative, Gosset attached great importance to the partnership of the three parties because, in his words, "when China, Europe and the U.S. work together, they can solve the most complex problems and contribute to the advancement of mankind."

Other participants echoed their calls for international cooperation and partnerships. Siddharth Chatterjee, UN Resident Coordinator in China, said that the Chinese Government is working to materialize its commitments, with a concrete roadmap for the 2030 and 2060 climate goals.

The year 2021 turned out to be a critical one for China, exemplifying its leadership in the fight against climate change. China hosted the Second UN Global Sustainable Transport Conference in Beijing and the UN Biodiversity Conference in Kunming. President Xi Jinping announced during the 76th Session of the UN General Assembly that China would not build new coal-fired power plants abroad.

Javier Solana, former High Representative of the European Union for Foreign Affairs and Security Policy, connected climate change with security. "One of my main worries for the future of humanity is whether we will be able to cooperate in tackling the climate crisis—the greatest threat to international peace and security," the former top EU diplomat elaborated.

Difficulties aside, progress is being made on the path to a greener economy, Joan McEntee, former Under Secretary with the U.S. Department of Commerce, said.

China and the U.S. issued a joint declaration on enhancing climate action in the 2020s on the sidelines of the COP26. They promised to collaborate in areas such as regulatory frameworks, green design and renewable resource utilization, whilst also agreeing to the formation of a working group to advance bilateral and multilateral climate cooperation. 

Erik Berglof, chief economist with Asian Infrastructure Investment Bank, which is committed to infrastructure financing, believed the China-U.S. announcement could really bring something new to the table. In his opinion, the global system suffers from a widespread and growing lack of trust.

"When it comes to climate change, nothing is more worrisome. This is really where we must start the process of rebuilding the trust," he said. "Not only to address our collective emergency, but also to rebuild confidence in the global community."

Berglof likened the pursuit of net-zero targets to the mutual deliberation behind arms control efforts. The key is to trust and verify—though verification might probably be easier. He believes that the multilateral development banks can take on an important role in the verification mechanism. These institutions can establish universal standards to be applied in the verifying process as well as help ensure the outcome is all-inclusive, giving developing economies and vulnerable populations a boost to rekindle multilateralism-fostering cooperation. 

Private participation 

The impact of climate change is asymmetrical and so are nations' abilities to respond to the change. In light of these, the world's wealthy nations in 2009 agreed to provide and mobilize $100 billion annually for climate action in the developing world. This funding fell short by $20.4 billion in 2020 and as of late December, it remains unlikely the target will still be met in 2021. The COP26 created more room for all parties involved to move beyond the original $100 billion and mobilize supplementary funds.

The global shift to net zero, then, will require trillions of dollars in investment. The Glasgow conference eventually came to the understanding that financial means should be accessible to those who need them most and the private sector should play a vital part in extending the right to their use. 

When it comes to climate change, governments, according to the public policies they originally designed and deployed, still have to lead the way. Yet companies and businesses must sync up with the authorities, especially intergovernmental agencies, said Eric Li, Vice Chairman of the China Forum at Tsinghua University and a dialogue moderator.

Chatterjee also pointed out that the private sector therefore needs to take on a much bigger responsibility in global action because engaging only the public sector is far from sufficient to fill the financing gap and develop innovative solutions in the transition to a net-zero economy.

He added the public sector needs to step up to drive investment in climate change, and coordinate mobilization of resources. To tackle the issue on a much larger scale, governments from different countries need to work together in the fields of harmonizing tax incentives for clean energy worldwide.

Li echoed Chatterjee on "harmonizing tax incentives," raising the example of Canada threatening tariffs over Joe Biden's proposed tax incentives on American-made electric vehicles. Canada also argues the tax credit runs counter to the renegotiated North American Free Trade Agreement.

Gian Maria Gros-Pietro, Chairman of Intesa Sanpaolo, explained the importance of green finance, referring to any structured financial activity that's been created to ensure a better environmental outcome, in the transition toward sustainability. Gros-Pietro, leader of one of Europe's largest banks, clarified, "Financial institutions will hold the primary responsibility for channeling private and public savings, market and sovereign financial resources, toward sustainable goals."

Leslie Maasdorp, Vice President and Chief Finance Officer of the New Development Bank, said there is also a need to look well beyond green finance, at all the financial instruments that can be utilized to aid the evenhanded transition to net zero.

(Print Edition Title: Race for net zero)

Copyedited by Elsbeth van Paridon 

Comment to maxiaowen@bjreview.com 

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