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Decoupling China in the Climate Debate

Interviewee: Elizabeth C. Economy, C.V. Starr Senior Fellow and Director for Asia Studies
Interviewer: Toni Johnson
September 22, 2009

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The bargaining positions of India and China have received increasing attention from Western countries ahead of the UN's December 2009 climate change meeting in Copenhagen, particularly from U.S. lawmakers worried about competitiveness issues. CFR Director of Asia Studies Elizabeth C. Economy says one possible concession China and India could offer on binding commitments for cutting greenhouse gas emissions relates to timing. "Certainly we shouldn't be asking them to do what we're doing today, but to get a firm and binding promise a decade down the line is not an unreasonable thing for both sides to come to terms on," she says. Economy also says China has a much greater capacity for addressing climate issues, and should be decoupled from the rest of the developing world. "China should be put into its own category. Other developing countries who have far fewer resources should be the primary targets for an international fund for supporting the development, implementation, and deployment of climate-related support," she says. "I would include India in this group [of countries] that are more in need of international resources."

The media and many policymakers have a tendency to lump China and India together in the climate debate. Can you talk a little bit about how China's challenges differ from India's?

China's economy is roughly three times as large as that of India, and its per capita GDP [gross domestic product] is three times greater. It can provide power to the vast majority of its people. India has not quite half of its people with access to electricity. India is still very much more a developing country than China is. China has also made far greater strides toward trying to address its environmental challenges. A greater percentage of China's energy comes from coal than in India, so in some respects its challenge moving forward in terms of addressing climate change is tougher, but it has greater financial resources to address the problem.

The two countries have been working very closely together to present something of a united front on climate change.† How united is this front and what are the major differences between India and China's approach?

India and China, two decades ago, presented a united front on the Montreal Protocol to reduce ozone-depleting substances on many of the same issues that they are now united on: issues related to sovereignty, to the responsibility of the developing world, and to the desire for financial and technology transfer.† Many of these same issues have arisen again.† In the case of the Montreal Protocol, once the international community agreed in essence to pay for China and India to do the right thing, China said okay and signed on very quickly. India was left holding the bag on principle--principles of sovereignty and a desire to not have an intrusive international regime.

While both [China and India] say they are not interested in binding targets, both have talked about non-binding targets as a possibility and both want to be perceived as responsible participants in a climate change regime.

This time around, India has moved closer to the Chinese position. While both countries say they are not interested in binding targets, both have talked about non-binding targets as a possibility and both want to be perceived as responsible participants in a climate change regime.† They want to be viewed as countries that are helping to address the problem.† Both agree that the developed countries should bear the lion's share of responsibility; both are calling for large-scale technology transfer and large funding initiatives from the developed world.† India has come around to be a bit closer to the Chinese position, although it is sometimes viewed as more obstreperous because of its tough rhetoric. I don't think it wants to be left behind this time.

EU officials have been pushing to link international climate funding to action by developing countries to lower their emissions: "no actions, no money." How realistic is it to tie financing to action and what kind of effect is this going to have on the China-India position in the climate debate?

In China and India, you probably have two countries that are reasonably willing to equate funding and action. It probably depends on how broadly you define action. For example, they would certainly be interested in funding for technology development, so if that counts as action, there would likely be common ground. If capacity building counts as action, then that would also be a very important element of developing China's and India's ability to address climate change. What the Chinese and Indians have said is that they are only willing to allow monitoring, reporting, and verification of actions that have resulted from international funding, so they don't want to be on the hook for demonstrating to the rest of the world that what they've said they're going to do they are actually doing, unless the rest of the world is paying for them to do it. But as long as you have a broad enough range of activities that constitute action, †both countries would be willing to sign on to something that said "funding equals action."

Developing countries, including India, have called for the United States and other developed nations to reduce emissions by up to 40 percent below 1990 levels.† Meanwhile, developed countries so far have had trouble selling less than half that level of cuts domestically. White House climate envoy Todd Stern said unless China and India do something in the binding or serious commitment level the U.S. Congress is going to impose carbon tariffs on imports.† What kind of concessions need to happen?

I don't think there's much that China and India can do to get their calls for 40 percent reduction of greenhouse gas emissions below 1990 levels made into policy in the developed countries. What China and India realistically can do within their own systems --what ought to be probably acceptable here in the United States and in Europe and Japan--would be perhaps not immediate binding targets, but voluntary targets up until 2015 or 2020, and then firm and binding targets in 2020. That actually has been proposed by the well-known environmentalist/economist Hu Angang in China. It doesn't seem to have gotten much positive play in China but he's quite vocal about it. The idea that China and India and other developing countries should trail the West in terms of their commitments, both in terms of when they're binding and the degree to which they're promising to cut, is an appropriate one. Certainly we shouldn't be asking them to do what we're doing today, but to get a firm and binding promise a decade down the line is not an unreasonable thing for both sides to come to terms on.

[Y]ou now have a wide range of officials and scholars who are putting forth their own ideas about what China might or might not do looking ahead. It's very difficult at some points to tell what is real policy.

Earlier this year Chinese officials said they were looking into a carbon tax. Would something like that work in China and India, and would that decrease international pressure?

There is a great danger to looking at ideas that are being floated in China or India as policy. One of the things that's happened over the past year and a half, in particular in China--India is a democracy so it's always had this issue--is that you now have a wide range of officials and scholars who are putting forth their own ideas about what China might or might not do looking ahead. It's very difficult at some points to tell what is real policy and what is an advisory policy, and what nobody is actually listening to except for the person who's saying it. The only way to understand what China is going to try to do is to look at what President Hu Jintao says or what the Chinese negotiators put on the table.

You've just recently come back from China. How do domestic issues right now, particularly the economic downturn, come into play in their approach?

I actually just came from a set of discussions where economics as well as green technology and climate change were a major focus of the overall discussions. In general, there is a sense that China has weathered the economic downturn better than everybody else.† They're first out of the box; among many Westerners and Chinese, there was almost a sense of economic triumphalism about China's situation. Most, not all, Chinese economists and senior government officials seem to be quite bullish on the state of the Chinese economy right now, and certainly that is what they are pushing within the Chinese media. There were some outliers, however, who questioned the conventional wisdom that China had gotten the recovery right.

If, in fact, China has emerged from the financial crisis as strong as ever, that should then allow them to be more aggressive when it comes to an issue like climate change. However, it doesn't seem to have shifted their overall stance. Instead, what you get is the sense that yes, we're doing much better than we'd anticipated and much better than everybody else economically, but the same facts still hold true in terms of what we're able to do with regard to global climate change and what we expect the rest of the world to do.

What I did find interesting, however, was that among the participants at the meeting, some of the strongest supporters of China taking more aggressive action on climate change were from the business sector. Some of the other Chinese participants were adamant that China should not target climate as a priority, that this was something for the rest of the world to address, and that this was something the Chinese people did not feel strongly about. It may be that we are seeing some of the same trends that we've seen in this country, where we have had a number of senior business leaders step up to the plate and say that they want to move forward on climate change and want certainty about their obligations for the future. †They see opportunities whereas many political leaders simply see costs.

It's been suggested that the United States should decouple China from India since research suggests that China's emissions will be the real game changer if the current trajectory of China's growth and infrastructure stays the same.† Do you think that this is the right approach?

It's the right strategy to decouple China from the rest of the developing world, not just China from India, but China from the rest of the world. China should be put into its own category; other developing countries who have far fewer resources should be the primary targets for an international fund for supporting the development, implementation, and deployment of climate-related support. China is in a better position to stand on its own to contribute to addressing the problem, whereas there are other countries, and I would include India in this group, that are more in need of international resources.

What are the broader opportunities for India and China to work together on climate bilaterally?

One of the most important issues that China and India will confront is the issue of shared water resources. China is in the midst of diverting water that India and Bangladesh consider essential for the livelihood of their people. As climate change intensifies, these water resources are likely to become even more precious and the source of significant conflict, unless the two sides can sit down and talk.

Is this because of the glaciers?

Part of the challenge will be because of the glaciers melting--first there will be flooding and then drought. But frankly, much of China's north is already water scarce, so the actions that China is taking today are to address a problem that exists today. The challenge will only become greater over the next decade or two if the melting of the glaciers accelerates.

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