Global Warming Politics: The EU, China, and Climate Change

Richard Balme. Europe and China. Volume 1. Hong Kong University Press, 2012.

Introduction

In recent years the accumulation of evidence regarding the probability, causes, and effects of climate change deeply renewed the logics and instruments of environmental policy-making. Once primarily a specific and domestic issue addressed by second-rank ministries and administrations, the need to develop climate change policies propelled the environment as an encompassing issue engaging most social activities and public policies, from energy production, urban planning, and transportation, to agriculture and deforestation. The growing concern among experts and public opinions pushed climate change on public agendas, while the systemic relation between climate and human activity called for a more integrated approach in environmental policy-making. In parallel, the global dimension of the phenomenon and the need for large-scale coordination between major polluters increasingly defined environmental policy-making as an international issue.

The development of climate change diplomacy is without doubt a fundamental change of international relations and a key aspect of globalization (Harris, 2007). Initial analysis and warnings about climate change came from scientists during the 1970s. They were soon relayed by international organizations, in particular with the creation in 1988 of the International Panel on Climate Change (IPCC) by the World Meteorological Organization (WMO) and the United Nations Environment Program (UNEP), and later on with the Intergovernmental Negotiating Committee for a Framework Convention on Climate Change (FCCC) by the UN General Assembly in December 1990. The FCCC was signed during the 1992 UN Conference in Rio (the “Earth Summit”) intended to provide the institutional architecture to design international protocols dealing with climate change, and came into force in 1994. In 1995, the Intergovernmental Negotiating Committee was replaced by the Conference of the Parties (COP) which, during its third meeting in 1997, adopted the famous Kyoto Protocol setting the first hard targets for reducing climate change. On the basis of the concept of “common but differentiated responsibility” acknowledged by the COP, developing countries did not take any binding policy commitment. Conversely, developed countries (listed as “Annex I” countries in the FCCC) agreed to reduce their Green House Gas (GHG) emissions by 5.2% below their 1990 levels between 2008 and 2012. EU member states went beyond this goal with an objective of an 8% reduction. The Kyoto Protocol also introduced emissions trading schemes allowing developed countries to buy and sell emissions credits among themselves. It also initiated two types of so-called “flexible mechanisms”: joint implementation, whereby developed countries can earn emissions rights when investing in one another’s emissions-reduction projects, and Clean Development Mechanisms (CDMs), where the same logic applies between developed and developing countries. Subsequent COP meetings hosted frequently acrimonious negotiations to design institutional and financial instruments. After ratification by Russia in 2004, the Kyoto Protocol was finally able to enter into full application in 2005. Since the 2007 Bali Climate Conference, COP meetings are now devoted to design a pact to replace the Kyoto Protocol when it expires at the end of 2012. The main contours of this agreement were expected to be in place for the Copenhagen Climate Conference of December 2009.

The EU and China have been to a large extent at the core of the process whereby climate change has become a prominent issue in international affairs. Seeing an opportunity to promote its own policy expertise and strong position in green technologies, and supported by the sensitivity of European public opinion on environmental issues and its preference for multilateralism, the EU was from the onset very active in promoting international agreements on climate. As the US eventually failed to ratify the Kyoto Protocol, and remained reluctant to negotiations on climate under the Bush administration, the EU was able to assume leadership among developed countries on the issue. On the other hand, as probabilistic evidence about human influence on climate change accumulated, the tension between energy-intensive modes of development and the capacity to mitigate climate change also became more apparent. As the most populated and fastest-growing economy of developing countries, China’s environmental policy and attitude with regard to climate change regime became increasingly scrutinized. Its record of the world’s longest C02 emitter, surpassing the US in 2007, was widely noticed, and China is frequently criticized for its dirty growth model and its global consequences. China nevertheless developed a significant policy to address climate and energy issues over the recent years. To a large extent, the limited steps accomplished so far at the global level in climate change policy relied on the convergence of domestic policies between the EU and China, and by their cooperation in the implementation of the Kyoto Protocol. The terms of agreement set to design a post-Kyoto Protocol, beyond the architecture of the climate regime, will therefore be critical for further developments of EU-China relations, and more generally for the evolution of globalization. How is climate change policy likely to support EU-China cooperation, and to upgrade the profile of their relation within globalization? We first present the EU and China policies regarding climate change in parallel, before analyzing the EU-China cooperation programs. We then explore the positions and issues at stake with the negotiations surrounding the post-Kyoto regime, before developing the conclusion.

EU Climate Policy

Since concerns about human-induced climatic change emerged as a major political issue, EU governments have been prompt to show political will to address the problem. Member states, and later the EU itself, adopted unilateral emissions reduction targets, and sought to follow-up with implementation policies, particularly to limit C02 emissions. At least until now, Europe has taken a forward stance on the issue of climate change. This can be observed with the European Climate Change Program, with the Emission Trading System (ETS), and with the bargaining positions adopted in the negotiations to design a new climate change regime.

After initial steps taken in Cardiff and Vienna in 1998, the European Commission established the European Climate Change Program in 2000 to initiate a comprehensive package of policy measures to reduce greenhouse gas emissions. Commitments taken by EU15 member states under the Kyoto Protocol to limit GHGs emissions add up to -8%, varying from -21% for Denmark and Germany to +25% for Greece, and +27% for Portugal. This EU15 coordinated policy was later on reviewed and developed through a number of policy instruments, in particular the “2 Degrees” communication (January 2007), endorsing the principle of aiming at containing the world temperature increase over the century within two degrees. Later on came the green paper (July 2007) and white paper on adaptation (April 2009), the communication on sustainable power generation fossil fuels (January 2007), the carbon capture and storage directive (December 2008), the legislative proposal integrating aviation into EU ETS (December 2006, agreed by the European Parliament, July 2008), and the communication and legislation on C02 and cars (January 2007/end 2007). This policy ended up with a revised European Climate Change Programme III adopted in 2009.

The most emblematic measure of the EU commitment on climate policy lies however with the ETS among the (then) EU15 member states, sometimes referred to as “the bubble.” The general idea of making use of market instruments for carbon emissions reductions had been put forward by European delegations to the UNCED discussions before the Earth Summit in Rio as measures to be incorporated in the Framework Convention. Obstacles to compliance with environmental regulations aiming at curbing GHGs emissions related to fossil fuels could be eased with the use of self-enforcing cap-and-trade mechanisms. Although the Kyoto Protocol did not provision possibilities for extension of the agreement among the 15 members, it allowed other countries to form bubbles of their own. Hence, accession countries and new member states could adopt their own carbon markets and transfer their credits to the other EU countries. Such a strategy of extension of the ETS through the EU enlargement process was also fostered with the use of joint implementation mechanisms (Kamala, 2005). As in other areas such as administrative transparency, promotion of the rule of law, market consolidation, and civil nuclear power security, the EU external influence on climate change policies has been extremely sensitive on its neighboring countries through the enlargement process. Moreover, Michaelowa and Betz (2001) estimated that this scenario alone would reduce the gap between the business-as-usual level of emissions and the Kyoto target by about 50%. On this basis, the EU is frequently criticized for trading rather than properly curbing the emissions of its main polluting member states (Werring, 2009). Nevertheless, the case for pure virtual EU reductions and ETS resulting in trading “hot air” (Byrne et al., 2004) does not hold. Albeit limited, GHGs emissions declined of-2.2% between 1990 and 2006 for EU15 (for a general commitment of-8% toward 2012). Reductions of EU27 countries on the same period reached-7.4%. This needs to be compared with Japan (+5%), the US (+14%), Canada (+21%), and Australia (+29%) (UNFCCC, 2008). More recent and more comprehensive figures show that emissions have not only continued their downward trend in 2008, but have also picked up pace. The EU27’s emissions in 2008 stood 11.3% below their 1990 levels, while EU15 achieved a reduction of 6.9% compared to Kyoto base-year levels. The EU seems on track to meet its commitments, and is the only group of countries so far able to curb its GHGs emissions (see EE A, 2010).

The 2007 Bali Action Plan started a process to conclude a new international climate agreement for the period after 2012 at the 2009 Copenhagen Conference. This agreement would need to set concrete new targets and actions to reduce GHG emissions and to provide the basis for sustainable development by strengthening countries’ ability to adapt to inevitable climate change while triggering innovation and economic growth, reducing poverty, and providing access to sustainable energy services (the “shared vision”). Following the UN Conference in Poznan in December 2008, talks have shifted into full but tortuous negotiating mode.

The successful conclusion of the international climate change negotiations at Copenhagen at the end of 2009 was proclaimed key priority for the EU. To achieve this goal, intensive contacts with third countries, both in the UN context and beyond, have been developed. The EU also revised its own domestic policy in relation to the phasing out of the Kyoto Protocol. The “two degrees” policy proposal was in line with the IPCC scenario admonishing developed countries to cut their emissions by some 25% to 40% by 2020 compared with the level in 1990 in order to contain temperature increase within two degrees over the century. The Commission proposed to commit the EU to a 20% emissions reduction by 2020, possibly extensible to 30% depending on other countries’ strategies; to raise the EU’s share of renewable energy in primary energy consumption to 20% by 2020; and to improve energy efficiency by 20% by 2020 (known as the “20-20-20” target). A more controversial objective imposing 10% use of bio-fuels in the member-states transport fuel mix was also formulated. The official Commission proposal was published in January 2008 as the Climate Action and Renewable Energy Package. It also included a proposal to revise the ETS, another to tighten national reduction targets for GHGs emissions not covered by the ETS, a new directive on renewables with differentiated national targets for renewable energy, a legislative framework for Carbon Capture and Storage (CCS), and amended guidelines on state aid for environmental measures (Adelle et al., 2009: 37-38). Amidst the financial crisis in late 2008, it was the topic of heated discussion between member-states and intensive lobbying. It was finally agreed under the French presidency, as well as by the European Council and the European Parliament in December 2008. The Council formally adopted the package in April 2009. The compromises between member-states and concessions granted to industrial sectors at risk from “carbon leakage” during the adoption of the Climate and Energy Package were not left unnoticed by environmentalist movements. However, this is by far the most ambitious commitment by any country or group of countries in the world for the post-2012 period, and to date the only significant one.

The development of the EU climate policy is remarkable from a number of perspectives. As a global policy issue, climate change drives the articulation between domestic and international policy-making. This is exemplified by the EU record under the Kyoto Protocol, to which the EU enlargement largely contributed, and by the Climate and Energy Package, where the expectation to preserve and develop the EU international leadership on the issue in the post-Kyoto context also fostered the adoption of internal policies. The EU case is also interesting in surmounting the collective action problem and the related prediction of failure in climate change policy. The EU member states did agree on joint policies and instruments at the regional level, solving their internal prisoner’s dilemma. They also committed themselves to a unilateral contribution to public good provision at the global level, to take a unified and prominent position in the international arena. Such a commitment is not strictly rooted in efficiency, as the scenario whereby European industries could bear the cost of the measures while global emissions would not be curbed in the absence of international agreement, cannot be ruled out at this point. Rather the EU policy stand is based on a mix of ethical considerations (the sensitivity of European public opinions to environmental threats and their acceptance of the precautionary principle, the recognition of historical responsibilities in overall GHGs presence in the atmosphere, the moral imperative of acting first), and ambitions for international leadership in an area where the EU institutions (the Commission and EP in particular) managed to push policy integration across the member-states rather far. Finally, it is also worth noticing that the EU preference for carbon markets, to be expanded to EU27 and maybe to OECD countries in the post-Kyoto agreement, has both cultural and political connotations. Despite technical difficulties in the implementation of the ETS, it rests ultimately on the belief in the efficiency of markets as instruments of regulation, exemplifying the “third way” approach of the EU on environmental issues. The use of carbon markets however can also be interpreted in more political terms. As opposed to taxation, it remains (so far) invisible and painless to most citizens. It is also more feasible within the EU, as taxation remains the responsibility of member-states and requires unanimity voting, while environmental issues are shared competencies and follow majority rules within the Council. It also allows for emission permits trading between the most advanced national economies, and new member states and developing countries. The policy proposal put forward by the EU in the international arena is therefore to a large extent shaped by the EU domestic structure, and this has important implications in its relations with third countries.

China and Climate Policy

While China’s image is severely tainted by a number of environmental disasters resulting from the intensity of economic change in the reform era, the development of its own environment protection policy is far less acknowledged (see Ma, 2000; Day, 2005; Economy, 2004; Ho and Vermeer, 2006). Climate change policy does not escape the rule. China’s record as the major C02 emitter as well as its stand in the post-Kyoto negotiation largely offsets its own policy regarding climate change, more advanced than what is frequently assumed (Seligsohn, 2008).

China’s Climate Policy Development

Generally speaking, China’s climate policies fall into three categories. First-level policies, established by the central government, provide general direction and guidance, and include speeches of state leaders about climate change and renewable energy, as well as the Chinese government’s standpoint on the global environment. Second-level policies, also established by the central government, include specific goals and objectives, development plans, laws, and regulations which attempt to standardize the directions, focal points, and objectives of renewable energy development from different dimensions and viewpoints. Besides, some ministries and departments propose concrete policies and regulations. Lastly, local governments, including provincial, municipal, and county governments establish the third level of policy, which consists of practical and specific incentives and managerial guidelines, with overall direction from the central government (NREL, 2004).

Policy measures related to climate are found within China’s traditional policy documents. In the Outline of the 11th Five-Year Plan for National Economic and Social Development of the People’s Republic of China (2006-2010), the government projected that the per unit GDP energy consumption by 2010 would decrease by 20% compared to 2005, and that the total amount of major pollutants discharged (SO2 and COD, but not C02 or GHGs) would be reduced by 10%. One year later (October 2007), the Report of the 17th National Congress of the Communist Party of China set the goal of accelerating the transformation of the pattern of development, and quadrupling the per capita GDP between 2000 and 2020, while only doubling energy consumption. A similar target was adopted and apparently achieved between 1980 and 2000, but the road ahead seems this time much more challenging (Buijs, 2009: 103). This would be achieved through the optimization of the economic structure and the improvement of economic returns, while reducing the consumption of energy resources and protecting the environment. In June 2007, the Chinese government issued its first National Climate Change Policy—China’s National Climate Change Program (NDRC, 2007) (hereafter referred to as the CNCCP), which states the objectives, basic principles, key areas of actions, and detailed policies in addressing climate change for the period up to 2010. It also signaled a more active role in international discussions, and asserted that the full implementation of the program would be in line with the United Nations Climate Change Convention (UNCCC).

This was the PRC’s first major initiative to combat climate change with clear policy measures, and it was the first time China made a positive, formal statement in the international arena tying its energy policy to climate mitigation. It has been supplemented by a number of more technical policy documents. China’s Scientific & Technological Actions on Climate Change, jointly issued by 14 ministries and institutions also in June 2007, was adopted to implement the key tasks identified in the Outline for S&T Development, to provide scientific and technological support to the CNCCP program, to coordinate climate change-related scientific research and technological development, and to enhance the comprehensive scientific and technological capacity in response to climate change. China’s renewable energy law was approved by the Standing Committee in February 2005 and came into in January 2006. The law intends to promote the development and utilization of renewable energy, to improve the energy structure, to diversify energy supplies, and to safeguard energy security. In September 2007, the National Development and Reform Commission (NDRC) issued the Medium-and Long-Term Development Plan for Renewable Energy in China, with an intention of speeding up the development of renewable energy, promoting energy conservation and reducing pollutants, mitigating climate change, and better meeting the requirements of sustainable social and economic development. It put forward the guiding principles, targets, and measures for the development of renewable energy in China up to 2020. In a move quite convergent with the EU, it set the goal of increasing renewable energy to 10% of the total energy consumption by 2010 and 15% by 2020.

On October 29, 2008, the State Council issued a white paper entitled China’s Policies and Actions for Addressing Climate Change, whereby the principles guiding China’s domestic policy amidst growing pressure within the post-Kyoto negotiation were made fully explicit. It was finally supplemented in May 2009, ten days before the Bonn talks and six months before the Copenhagen Conference, when China issued a separate position paper. The paper illustrates China’s proposals on implementing the “Bali Roadmap” and the country’s will to work for a positive outcome from the Copenhagen Conference (NDRC, 2007). To a large extent, the position paper was a compilation of previously existing government’s statements or speeches on specific issues and important international meetings. It was important, for it was the first explicit and comprehensive position statement on climate negotiations, on which international observers and analysts could base their expectations and assessments. However, the document released by the NDRC in May 2009 was also a hardening of China’s positions in the negotiations, relative to their earlier submission to the UN FCCC, with demands positioned at the “far end” of the ranges suggested earlier.

The key principles developed by the paper are the following:

(1) The UNFCCC and its Kyoto Protocol as the basis and the mandate of the Bali Roadmap as the focus: the UNFCCC and its Kyoto Protocol are acknowledged as the basic framework and legal basis for international cooperation to address climate change. The Bali Roadmap defines the legitimate mandate to design the implementation of the UNFCCC after the Kyoto Protocol, which is, on the one track, to secure the full, effective, and sustained implementation of the UNFCCC by making corresponding arrangements in terms of mitigation, adaptation, technology transfer, and financial support, and, on the other track, to determine further quantified emission reduction targets for developed countries for the second commitment period under the Kyoto Protocol.

(2) The principle of common but differentiated responsibilities: developed countries should take responsibility for their historical cumulative emissions and current high per capita emissions to change their unsustainable way of life and to substantially reduce their emissions and, at the same time, to provide financial support and transfer technology to developing countries. Developing countries will, in pursuing economic development and poverty eradication, take proactive measures to adapt to and mitigate climate change.

(3) The principle of sustainable development: sustainable development is both the means and the end of effectively addressing climate change. Within the overall framework of sustainable development, economic development, poverty eradication, and climate protection should be considered in a holistic and integrated manner so as to reach a “win-win” solution and to ensure developing countries to secure their right to development.

(4) Mitigation, adaptation, technology transfer, and financial support are on the same footing and defined as equal priorities: mitigation and adaptation are integral components of combating climate change and should be given equal treatment. Compared with mitigation which is an arduous task over a longer time horizon, the need for adaptation is more real and urgent to developing countries. Financing and technology are indispensable means to achieve mitigation and adaptation. The fulfillment of commitments by developed countries to provide financing, technology transfer, and capacity building support to developing countries is for the PRC a condition sine qua non for developing countries to effectively mitigate and adapt to climate change.

According to these principles, the objectives of the Copenhagen Climate Conference were defined as follows: Regarding mitigation commitments by developed countries, the paper re-emphasized that developed countries shall “undertake measurable, reportable and verifiable legally-binding deeper quantified emission reduction commitments,” and shall reduce their GHG emissions by at least 40% below their 1990 levels by 2020, “given their historical responsibility and development level and based on the principle of equality.” The negotiation is also expected to establish effective institutional arrangements to ensure that developed countries are fulfilling their commitments to provide technology, financing, and capacity-building support to developing countries, and that they provision 1% of their GDP in doing so. Finally, the new climate change regime should enable developing countries to take Nationally Appropriate Mitigation and Adaptation Actions (NAMAs), with the support of developed countries but in full independence.

Climate Change Incentives in China

Under certain aspects the fast development of climate change policy in China over the recent years defeats the predictions based on a view of the regime as insensitive to environmental issues, and irresponsive to domestic or international opinion. What is then driving these policy developments? A major contributor to environmental policy innovation in recent years was a rapidly growing awareness of the damages caused by industrial disasters and environmental pollutions. The rise of environmental consciousness and corresponding policy responses is mainly expressed by the creation of environmental protection bureaus at various governmental levels. The push of environmental problems on the public agenda has been progressive, and driven by the accumulation of environmental disasters, epitomized by a large spill of toxic chemicals in the Songhua River in China’s industrial northeast which shut down the water supply for the city of Harbin for several days in November 2005. Coming just a year and a half after the 2003 SARS crisis, this environmental catastrophe was part of a flux of events driving the Chinese leadership toward a broader definition of development, including public health and environment protection together with economic growth, mainly for reasons of public safety and public security. As a result, strong pollution abatement and energy conservation goals were enshrined in the 11th Five Year Plan. (These are frequently referred to together under the rubric jieneng jianpai or “energy efficiency and pollution abatement.”) As part of this growing awareness of the environment fragility and political sensitivity, the Chinese leadership also began to pay more attention as to how China could be affected by climate change’s impacts.

However, the major factor driving climate policy development is in fact energy security. China has abundant coal reserves, but coal production and transportation are inefficient, while the growth of oil and natural gas imports has become a concern. In 2005, China became the focus of global criticism because of its increased energy demand. This criticism made policymakers fear that China’s ability to import needed energy resources was under threat. After oil imports spiked by 17% in 2004 (well above the trend growth rate of 6-7%), international concern over China’s energy thirst grew on the one hand and Beijing’s concern about relying on international sources for energy intensified on the other. Those concerns prompted the NDRC to dust off some existing energy efficiency programs, add some energy substitution measures—including new renewable energy goals and an intensified focus on nuclear energy—and encompass these into clear energy targets in the 11th Five Year Plan (2006-10).

Finally, China increasingly had to face international critics for its growing emissions. Over the past two decades, manufacturing in a number of industrial sectors massively moved to China. At the beginning of the 1990s, China accounted for less than 10% of global production of major industries save cement, which was just over 21%. By the end of 2007, China’s global market share had grown to 36% in steel, 32% in aluminum, 21% in basic chemicals, 16% in paper, and over 50% in cement (Houser, 2009). Furthermore, making these goods in China with lower environmental standards leaves a higher carbon footprint than doing so in the US or Europe. As a result, China has recently taken the throne as the largest annual emitter of C02, and is projected to account for nearly half of the global growth in emissions over the next 25 years. An image of great emitter grants China with an embarrassing position in the international arena, not to speak about the local and social implications for the Chinese population of high levels of air pollution. It also explains the sensitivity of China to policy proposals to tax carbon on imported goods, and some propensity to interpret carbon regulations as disguised protectionism among the Chinese media. Such a combination of factors converged to create a political will to recognize climate change as a significant policy issue and to move the global process forward.

When organization is considered, climate change policy is placed under the National Leading Group on Climate Change chaired by Premier Wen Jiabao with the NDRC. The Department of Climate Change also streamlines international policy-making on climate change and its domestic implementation. Relevant ministries and departments of the State Council as well as local governments at different levels are called to contribute to the definition of technical and local responses to climate change. The European Climate Change Programme provisions to establish regional administration agencies to fulfill and implement the national program, and to organize and coordinate local activities and actions in response to climate change.

Policy implementation and enforcement are a perennial problem in the Chinese political system. The most common complaints from Chinese and foreign environmental analysts focus precisely on this system of (local) Environmental Protection Bureaus (EPBs): on their poor environmental capacity; on the dependence of the local EPBs on both the higher-level EPBs and on local governments, which often have no interests in stringent environmental reform but play a key role in financing the local EPBs; on the lack or distortion of environmental information; on the low priority given to environmental criteria in assessing local governments; and on the poor financial incentives for both governments and private actors to abide by environmental laws, standards, and policies.

Nevertheless, the state in China is clearly undergoing a number of significant transformations, and although it is clearly too early to give a precise assessment, climate change is likely to be a significant drive of the process. As China’s Energy Conservation Law came into effect on 1 April 2008, work carried out by local government officials in energy conservation are officially integrated into the assessment of their political performance. As another example illustrates, the Urban Environmental Quality Examination System of environmental indicators not only allows the Ministry of Environment Protection (MEP) to compare municipalities, it also enables governments to design environmental responsibility contracts with local leaders for improvements in individual indicators, and to link these to assessments, financial incentives, and promotion, thus encouraging town and village leaders to take environmental protection more seriously. This measure makes local environmental governance accountable to the higher levels, in a situation in which decentralized, civil society-based systems of accountability are underdeveloped. Via such mechanisms environmental standards are brought into the political system, so that local leaders are no longer judged according to exclusive political and economic criteria, but also according to environmental results (Rock, 2000).

Secondly, together with economic liberalization, decentralization of decision-making, and experiments with local democratization, China is also experiencing mounting pressure from citizens, demanding that local environmental authorities reduce environmental pollution. There is growing attention paid by the Chinese media to environmental pollution and environmental mismanagement, while the work of dynamic NGOs increasingly tries to articulate civil society’s environmental interests to economic and political decision-makers. It is also notable that Chinese officials, especially in the central government, have openly acknowledged the problems of ineffective environmental policy enforcement nation-wide and permitted widespread reporting about it in the Chinese media.

Environmental NGOs are rising in China today and begin to play an active and important role, although the situation ranging from encouragement to crackdown of civil society involvement remains at best ambiguous. The government has to face the reality of NGO activism and the growing number of environmental protests (e.g. Xiamen anti-paraxylene protest) (China Daily, 2008). In July 2007, initiated by a range of local and international NGOs in China, a project seeking common positions and strategies in common actions to combat climate change was designed. Over 200 NGOs joined a survey, several rounds of consultation and workshops before the Positions of Chinese Civil Society came out right before the Bali Climate Conference in December 2007. Although the statement was relatively moderate when compared with those issued by NGO platforms in other countries, it sent a strong signal about civil society’s activity and involvement on environmental issues in China. On 31 January 2008, the German Environment Minister Sigmar Gabriel held a special meeting with Chinese environmental NGOs during his climate-and-energy-orientated trip to China.

Climate Change and EU-China Cooperation

In the recent years, climate has become one of the prominent areas of cooperation between the EU and China. This has to be understood in a context where rapid economic development in China somewhat changes the priorities of cooperation policy, shifting them away from poverty alleviation, while progress in the areas of human rights remain limited. Environment and climate are therefore among the areas where cooperation policy is both desirable and feasible.

EU-China Partnership on Climate Change

A joint declaration between China and the EU was released in September 2005, which agreed on a partnership on climate change as one of the major outcomes of the China-EU summit. The focus of the partnership is on the development and deployment of clean energy technology. It contains two different cooperation goals, to be achieved by 2020. The China-EU Action Plan on Clean Coal is to develop and demonstrate advanced “zero emissions” coal technology. This technology will allow for the capture of C02 emissions from coal-fired power plants and its subsequent storage underground, for example, in exploited oil or gas fields, or in sealed geological strata, thereby avoiding C02 emissions into the atmosphere. The second cooperation program, the China-EU Action Plan on Energy Efficiency and Renewable Energies, aims to significantly reduce the cost of key energy technologies, and promote their deployment and dissemination.

Clean Development Mechanism

The Clean Development Mechanism (CDM) was set up under the Kyoto Protocol to the 1992 UNFCCC. CDM allows industrialized countries to achieve part of their emission reduction commitments by investing in emission-saving projects in developing countries and counting the reductions achieved toward their own commitments. It is currently designed as a project-based offset mechanism in which developing countries can sell credits that represent emission reductions achieved by a specific project. These credits can then be bought by a developed country in order to comply with its national reduction target. CDM projects provide financing for clean technology and build capacity for climate policies in developing countries.

The EU-China CDM Facilitation Project is the largest European-funded project addressing CDM-related activities. It brought together a wide range of stakeholders at public and private sector levels involved in CDM projects over a period of three years (February 2007-March 2010), for total financial contribution of €2.8 million.

Through a series of activities including policy research, policy study visits, Designated Operational Entities (DOEs) training programs, and capacity building, the project provides policy recommendations to CDM policy-makers in Europe and China, enhances Chinese DOEs’ capacity, and supports the future development of CDM in China.

In June 2010, China had 877 CDM projects registered with the UN, accounting for 38.8% of the program’s projects the world body has approved globally. Chinese CDM projects represented over 207 million carbon credits or certified emission reduction (CERs), 49.2% of the total issued by the UN. Globally 65% of CDM projects are initiated by investors from the European Union, rising to 85% if Switzerland is included in the calculation (UNFCCC, 2011). Both China as receiver and Europe as investor have been crucial in the operating of the CDM under the Kyoto Protocol. Beyond the effectiveness of emission reductions, implementation of the CDM has also been a major instrument for the mobilization of climate policy stakeholders in China. At the second Business Facilitation Conference on CDM and Bioenergy in Beijing on June 12, 2009, Gao Guangsheng, director general of the Department of Climate Change at the NDRC, addressed that practice in the CDM projects with cooperation from the EU had proved the mechanism “successful for China to fight against climate change by motivating active participation from the governments, enterprises and the general public.”

Technology Transfers

The EU and China are also engaged in energy and climate technology cooperation. In January 2008, the EU agreed to establish a center for clean energy technologies in China. It also prepares the ground for a carbon capture and storage demonstration project in China around 2015 (alongside up to a dozen plants in Europe) (China Daily, 2009a). According to a World Wildlife Fund (WWF) report last December, some US$ 1.5 to 1.9 trillion may be invested in environmentally friendly technologies in China before 2020. In May 2009, Britain and China launched a £10 million (US$ 15 million) joint venture on low-carbon technology transfer (China Daily, 2009b).

However, low-carbon knowledge transfer from developed countries to emerging economies like China is still controversial. The question remains open over how much profit developed countries should exploit as a technology leaders, rather than giving away the know-how for free. But the meanings of green transfer are more than merely business interests. China has geared up its move towards a clean energy economy as a necessity rather than an alternative. Of the US$ 585 billion stimulus package issued in 2008, US$ 30.8 billion is said to be allocated to energy conservation and ecological engineering, with the aim to double its renewable energy to 15% by 2015. Although the ecological impact of these measures is overall disputable (Andrews-Speeds, 2008), they participate to the promotion of renewable energies in China, and to the deliberate attempt to be at the forefront of the development of green technologies.

The EU, China, and the Future of the Climate Regime

While the negotiations to prepare a new design for the climate regime after expiration of the Kyoto Protocol have been announced as critical, discussions were particularly tortuous, and the Copenhagen conference eventually failed to fulfill expectations for a binding agreement. To the intensity of stakes, the number of parties and the moral dimensions involved, the financial crisis added another incentive to postpone difficult choices. While the EU stood as the most proactive group in the talks, China was granted the ambivalent position of needing to assume new responsibilities coming with economic wealth, while (still) being the most powerful of developing nations, therefore the most able to resist to pressure from developed countries. The EU announced an ambitious commitment to reduce GHGs emissions by 20% to 40% by 2020 compared with the level of 1990. It failed however to persuade the US to go beyond a target of 17% for 2020 as compared to 2005, and to obtain the creation of an International Emission Trading System beyond Europe. China announced an objective of reduction of energy intensity (C02 emissions per unit of GDP) of 40% to 45% in 2020 as compared to 2005. China’s engagements also include increasing the share of non-fossil fuels in primary energy consumption to around 15%; increasing forest coverage by 40 million hectares and forest stock volume by 1.3 billion cubic meters by 2020 over 2005 levels. Although the Copenhagen Accord has so far not been adopted by the UN Climate Convention, it nevertheless provides significant policy proposals, including the inclusion of fore station in the calculation of emission reductions, the funding of mitigation and adaptation action up to US$ 100 billion per year by 2020, and the creation of a strategic fund for technology transfers. Positions of developed countries however remained far from the recommendations of the IPCC, which advocated a commitment of 40% reduction of emissions for 2020 over 1990 levels. Developing countries avoided any commitment for emission reductions in the future, and China firmly objected to monitoring and inspection procedures run by international experts. The Chinese negotiators however appeared rigid within the negotiation, without room for maneuver, and unable to move towards the compromises needed to reach a deal. Europe remained isolated in its leadership on the issue, while China was defensive, and primarily reactive to the US position.

Divergences between Developed and Developing Countries

These divergences reflect the long-standing disputes between developed countries and developing countries on their respective environmental responsibilities. Global GHG emissions due to human activities have grown since pre-industrial times, with an increase of 70% between 1970 and 2004 (IPCC, 2007). In 2004, UNFCCC Annex I countries held a 20% share in world population, produced 57% of the world’s GDP based on purchasing power parity basis, and accounted for 46% of global GHG emissions. The vast majority of GHGs accumulated in the atmosphere emanated from the industrialization of developed countries in the last two centuries.

Today, China and some developing countries are undergoing their own era of intensive industrialization, and an increase of energy consumption is an inevitable corollary of their economic and social development. These facts explain why the two sides have very different perspectives on the issue of climate change. China maintained an overall positive attitude in each round of talk before the Copenhagen Conference, and announced its own commitment beforehand. However, Chinese authorities also made clear that they would not accept binding commitments for emission cuts for developing countries, for a conjunction of domestic and international reasons.

To properly interpret China’s position on international negotiations requires some understanding of the Chinese reality and the vision of the country’s government. The Beijing government sets, and will set for a long time to come, economic development and poverty alleviation as its main tasks. It is unrealistic to expect China, not yet fully industrialized, to sacrifice economic development for climate policy reasons. It is even more unrealistic to expect China to take initiative if some major developed countries opt out of the agreement. China does not escape its own domestic politico-economic structure—the pressure and influence of vested national interests—underlying international bargaining. Although green business is quickly developing in China, Chinese industrial interests and their employees are more reluctant than proactive on climate policy. As a result, the government overall favors technological innovation and adaptation over mitigation policy, which has to be primarily adopted and demonstrated by developed countries.

Breaking the Sino-US Deadlock

China and the US combined together emit about 40% of the world’s GHGs. Therefore, a deal between China and US is extremely crucial, and a game in itself nested in the more general negotiation. The US once used China as an argument for refusing to ratify the Kyoto Protocol. US Senator John Kerry has been quoted as saying: “There’s no way we are going to get an agreement in the US Senate unless they (China) reduce their emissions.” The US Congress imperative on China has long created a deadlock in the relation. With the Obama administration, the US Congress has embarked on development of the Waxman-Markey bill, or American Clean Energy and Security Act (ACES), HR 2454, which brought the US back into action at the international climate negotiations. The bill however has been limited in its ambitions by the legislative process, in the context of the financial crisis taking over the agenda. It can also be argued that the US administration accepted the limited engagement of China in the negotiation, knowing it would only receive a limited mandate from the Congress afterwards. In a two-level game, the US administration is bound by the Congress in its international negotiation position, and the Chinese position sets a limit to its own capacity to push a domestic climate policy at home. This interdependency between the US and China considerably changed the situation prevalent with the Bush administration, and became central in the Copenhagen meeting and its more-than-limited accomplishments. But it also considerably watered down the EU leadership in designing the climate change regime.

Conclusion

Under many aspects it can be argued that, beyond the financial crisis, climate change is in the process of replacing the Washington consensus as the new policy paradigm of globalization. Issues of economic wealth, access to development, global justice among states and individuals, relations between developed and developing countries, regional and international security, and relations between the past and the future of international relations, are all engaged and re framed with the advent of climate change as a major issue on the international agenda. By design, no country or region of the world remains immune of the implications of climate change. Both the EU and China have been at the core of global governance on the issue, and at the forefront of the limited accomplishments realized so far. The EU was very pro-active in designing the Kyoto Protocol, and will display the best records in emission reductions at the end of the period in 2012. Following the recommendation of the IPCC that in order to contain the global average temperature increase within 2°C above pre-industrial levels, developed countries as a group should reduce their emissions to 25-40% below 1990 levels in 2020, the EU took the lead by committing to a 20% reduction in its emissions compared to 1990 levels by 2020, irrespective of whether or not an international agreement is concluded. The EU is willing to go further and sign up to a 30% reduction target in the context of a sufficiently ambitious and comprehensive international agreement that provides for comparable reductions by other developed countries and appropriate actions by developing countries (European Commission, 2009: 3). As the world’s biggest developing country, China has also formulated and released a package of policies and programs aimed at addressing climate change, and has taken a series of measures, including enhancing energy efficiency, diversifying China’s energy balance, strengthening environmental protection, and improving the legal framework needed to tackle climate change. In international negotiations China stresses technology transfers and adaptation strategies until further commitment is taken by developed countries on mitigation policies.

The EU and China obviously share common concerns about climate change but different views on global governance on the issue, rooted in diverging structures of domestic interests. Environment and climate have nevertheless generated active cooperation policy programs in bilateral relations. So far, CDM has been the main policy instrument to manage the cooperation between developed and developing countries in mitigation policies. As China received the largest share of these projects, most of which established with EU partnerships, it can be said that EU-China relations have so far brought the most significant contribution in the implementation of the limited global governance to tackle climate change. The paradox, however, is that the issue of the negotiation to design a climate change regime after Kyoto is more dependent on the prospect for the commitment of the US administration than on the record of EU-China relations on the issue.