Not on the same green page

The EU and the US see China as a competitor as well as rival at a time when cooperation on climate change is a prerequisite to realizing carbon neutrality

Climate change is a global challenge that requires collective action by all countries. Major geopolitical frictions in the past year have not helped. The Ukraine conflict, crises in the global energy and food markets and rising debt in developing countries have been the backdrop for difficult negotiations at the 27th Conference of the Parties to the United Nations Framework Convention on Climate Change (COP 27) in Sharm el-Sheikh, Egypt, in November. They were overshadowed by wealthy nations not having completely fulfilled their financial commitments toward the Global South. Emerging markets criticized as hypocritical the return to increased use of fossil fuels in Europe.

Given the significance of the task, it is all the more important that China, the European Union and the United States, which are together responsible for about half of the world's greenhouse gas emissions, cooperate constructively.

Of the three major economies, the EU so far envisages the earliest and most stringent curbs on carbon emissions. China, the world's largest emitter, has pledged to take the most important steps quantitatively. China is on the way of becoming an "ecological civilization". Four-fifths of solar panels produced globally come from China and two-thirds of electric vehicles sold worldwide are sold in China. The US has, under the Barack Obama and Joe Biden administrations, endeavored to attain global climate leadership. But the international community is mindful of the fact that former US president Donald Trump, who took the US out of the Paris Agreement, is running for president again next year, and its confidence in US climate policy is mixed at best.

While these three actors pursue the same goal of carbon neutrality, the instruments they use are significantly different. China bets on its strong and growing green industry that it supports by investing billions of dollars. The EU counts on containing carbon emissions through market forces, including carbon pricing and its emissions trading system. The Biden administration relies on the Inflation Reduction Act that foresees nearly $400 billion in tax credits for green industries.

These different approaches may make cooperation between the three economies difficult. EU and US companies complain about the absence of a level playing field with local companies in China. The EU has set up a carbon border adjustment mechanism that foresees a tariff for imports from countries with less stringent rules; this is viewed with concern in China, the US and beyond. Biden's approach to hand out tax relief only to companies that produce in the US is seen with suspicion by the EU which fears that its industries might decamp to greener pastures in the US.

These disagreements will not be the last ones to emerge in the complicated world of climate diplomacy. Over the coming decades, other issues — some related to climate issues, others to general politics — are sure to come up. It is therefore of paramount importance to stabilize cooperation among the major players.

That contacts on climate policy are ongoing between the world's largest three economies is therefore welcome. At their meeting in Bali last November, President Xi Jinping and President Biden directed their staff to look for areas of cooperation. At Sharm el-Sheikh, China's climate envoy Xie Zhenhua appeared side-by-side with his US counterpart, John Kerry.

In spite of differing positions, the EU and China cooperated constructively at the conference to resolve the thorny issue of a "Loss and Damage Fund" for vulnerable countries. Also the US and the EU are cooperating on climate issues; with the professed aim of fighting carbon emissions they are weighing new tariffs on Chinese steel and aluminum.

This last example shows that trilateral cooperation is sorely needed. Both the EU and the US have repeatedly pointed out that while they see China not only as a partner and competitor, but also as a systemic rival, cooperation on climate should not be impaired by controversies in other fields. China, conversely, has stressed that success in climate negotiations requires an overall good political atmosphere.

It is indeed illusory to expect a country that one describes as a rival to play along nicely on climate issues. The EU and the US should understand that a cooperative relationship across the board is a prerequisite if China is to be induced to join forces with them to attain early carbon neutrality. China should in turn abide by its long-standing position that some disagreements between countries with different histories are natural.

All three players should refrain from using short-term political issues as an excuse to interrupt or delay cooperation. Only when the three sides are ready to adequately manage their conflicts can international climate diplomacy be successful.

The author is a former member of the German Foreign Service and a researcher at the German Studies Center at Tongji University. The author contributed this article to China Watch, a think tank powered by China Daily. The views do not necessarily reflect those of China Daily.

Contact the editor at editor@chinawatch.cn.