June 26, 2024
DALIAN – November’s COP29 United Nations climate talks in Azerbaijan must have a new global agreement on climate finance or risk setting back the green transition, China’s top climate official said on June 25.
Mr Liu Zhenmin, Beijing’s special envoy for climate change, also said efforts by the US and European Union to target Chinese green tech goods with tariffs will only lead to higher global prices for solar panels, batteries and other goods vital to the green transition.
Speaking at the World Economic Forum’s Annual Meeting of the New Champions in Dalian, China, Mr Liu told a panel discussion that China’s innovations and vast manufacturing capacity have helped the world speed up the adoption of green energy.
“Globally, we need to be united to avoid these unilateral actions. They are going to raise the cost,” he told a panel discussion, moderated by The Straits Times editor Jaime Ho, on unlocking climate leadership in a competitive world.
The other panellists were Professor Julie Zimmerman, vice-provost for planetary solutions at Yale University, and Professor Kim Sang-hyup, co-chairman of South Korea’s Presidential Commission on Carbon Neutrality and Green Growth.
China, the world’s largest greenhouse gas polluter, is also by far the world’s largest producer and investor in renewable energy. The government sees green energy as key to reaching net-zero emissions by the mid-century.
Globally, in 2023, the world added 473 gigawatts (GW) of renewable energy capacity, according to the International Renewable Energy Agency. China accounted for the lion’s share, adding another 297.6GW, mostly wind and solar.
This rapid growth in China, fuelled by state subsidies, has helped slash green energy costs globally, and further investment will drive costs down even more, said Mr Liu.
“I think we are also prepared to collaborate with many of the developing countries to help them. So globally we have to maintain this process for both the innovation and manufacturing,” he said. And for the world to achieve carbon neutrality, there needs to be further investment to make clean technology even cheaper, he added.
The panel discussion comes against a backdrop of rising geopolitical and trade-related tensions and increasingly severe impacts from climate change, with 2023 being the hottest year on record.
More than ever, nations need to collaborate on financing innovation to limit global warming to 1.5 deg C above pre-industrial levels, a key guard rail under the 2015 UN Paris Agreement.
COP29 will be a major test of cooperation and willingness to step up the fight against climate change. At the summit in the Azerbaijan capital of Baku, nearly 200 countries will be tasked with agreeing on a new global goal for funding, called the New Collective Quantified Goal.
“We must have an agreement on financial support at COP29,” Mr Liu said.
But there are signs that getting agreement, a key measure of COP29’s success, will be a fraught process. Climate finance has been one of the most divisive issues in three decades of UN climate negotiations.
Poorer nations, which are the most vulnerable to climate impacts but are least responsible for the emissions driving the climate crisis, say rich nations should provide funding to help them adapt to impacts and to green their fossil fuel-dependent economies.
Yet the costs of climate impacts keep rising, and many poorer nations are deep in debt.
They are already missing out on much of the green investment boom globally because they lack the financial resources or policies to support investment.
Wealthy nations refuse to commit to large and growing climate costs, and want to spread the financial load to other countries.
Differences were laid bare during preparatory talks for COP29 in Bonn, Germany, that wrapped up on June 13. There were deep disagreements over the size of the goal, who should pay, how much to pay, and where the money would come from – for example, from taxes on fossil fuels or debt swaps.
The new goal must be more than the existing US$100 billion (S$135 billion) that rich nations pledged back in 2009 to provide annually by 2020 – and eventually reached in 2022.
The UN pointed to an independent report from 2023, which estimated that US$2.4 trillion of investments per year are needed by 2030 in developing countries – excluding China.
This would be a fourfold increase from current levels, and includes public finance, as well as private finance and funding from sources including development banks.
India, African countries and small island nations have said more than US$1 trillion should be raised per year, but have mixed views on how much of this should come from government coffers.
The EU and US want to add new donors, including China and countries with high gross domestic product per capita, such as Qatar, Singapore and the United Arab Emirates.
Beijing has firmly opposed this, and Mr Liu reiterated China’s position.
“China will not be a donor like OECD countries. But we are going to continue to support multilateral development banks in their efforts for the investment in climate action. We are going to continue our support to other developing countries through South-South cooperation,” he added, referring to the Organisation for Economic Cooperation and Development club of wealthy nations. China is the world’s second-largest economy.
“We also need to mobilise all sources of support for this global process,” Mr Liu said, a view shared by Prof Kim.
Building up the skills of people, working with developing nations on climate solutions and helping fund climate adaptation projects are ways to drive change, Prof Kim said. For instance, the Global Green Growth Institute based in South Korea supports the green and low-carbon transition of developing and underdeveloped countries. And the Green Climate Fund, also based in South Korea, deploys donor money from a variety of sources to developing nations.
“By working with those international regimes together with like-minded countries, I think Korea can contribute something to the world,” he said.
Another key area of collaboration is education – to train the people needed for a climate-changed world, said Prof Zimmerman.
“It is working with partners in industry and in government to understand what skills will be necessary, so that we are training a workforce that’s prepared for future jobs and the future world that’s changed by climate,” she told the panel.
“I think universities really need to think about defining what a future that we want to live in (looks like),” she said.