There may not be a “snap-back” in the Australian economy as COVID-19 fades, but one may well happen somewhere else: in the Paris Agreement on climate change.
Campaigning for president four years ago, Donald Trump said that he would “cancel” the Paris Agreement, which every country had signed and most had ratified. The terms of the agreement require two years’ notice for a country to quit. As soon as it came into force legally, Trump gave notice. The US will leave the Paris Agreement in November, one day after the coming presidential election.
A country that leaves can re-join by giving 30 days’ notice. Joe Biden has said if he is elected, the US will re-join as soon as it can. He has promised a far more pro-climate agenda than under Trump. It looks likely (though not certain) that Biden will be elected. He will have to wait to give notice until he is inaugurated in January, but the US could be back in the Paris Agreement by late February. Once again, the agreement will cover every nation in the world.
The US is important in climate issues. It is the world’s second-largest emitter of greenhouse gases, with 13% of the total. It has long been a leader in the world of ideas. If it is undermining the Paris Agreement, as it has been under Trump, other countries may feel it is not worthwhile to make any effort to cut their emissions.
By far the most important of these other countries is China, which emits 27% of the world’s greenhouse gases. As with so many aspects of world affairs today, China holds the key.
Under the Paris Agreement, nations set their own commitments to reduce emissions, known as “nationally determined contributions”, or NDCs. The nations agreed to get together every five years to review progress overall and consider how each country is doing. This is designed to create pressure from other countries and from internal political processes to push each nation to ratchet up its commitment.
People in the climate denialist camp like to say China is doing nothing under the Paris Agreement, but this is not true. China’s NDC committed it to reducing the carbon intensity of its economy sharply and to building up its non-fossil energy sources. It is on track to achieve or surpass the goals it set.
China is still building a lot of coal-fired power stations. At the same time, it is installing more wind and solar power than any other country. It is building hydro and nuclear power stations as well, and setting up an enormous domestic emissions trading scheme. Commentators have said President Xi Jinping allows this contradictory situation to continue in order to sustain a high rate of investment and keep China’s economy pumping. This is critical for the country’s internal stability. If the coal power stations are to become stranded assets in a few years, the attitude seems to be that they will deal with that then.
The interesting question is what China will do with its NDC. Sooner or later, there are reasons to think it is likely to adopt a tighter NDC and commit to major emissions reductions. This could be in time for the big global climate conference in Glasgow late next year, or it may not be until the next such conference five years further on.
On September 22nd, President Xi announced a tightening of China’s climate targets in a virtual address to the UN General Assembly. He said China would achieve carbon neutrality (otherwise called net zero emissions) by 2060. He may well go further if Trump loses.
China has exceptionally bad air pollution, which causes health problems on a huge scale. Some of its heavily populated coastal areas are threatened by sea level rise, including parts of Shanghai and the Pearl River Delta. But, most critically, China depends for its fresh water on snowmelt from the Himalayas and Tibet, source of all its great rivers. The ice and snow in this region is diminishing fast as the world warms.
These are ample reasons for China to want the world to get control of climate change.
Commentators such as The Economist have said achieving net zero emissions within 40 years will be a hard call for China. But China is exceptionally good at doing hard things on a national scale, as we saw recently with the battle against COVID-19.
If China commits to a strong program to reduce emissions, it will expect other countries, like us, to do so too. It is likely to make this known in the forceful manner to which we are becoming accustomed.
So, it is possible that a year from now Australia could find itself being pressed by both China and the US to do more to cut greenhouse gas emissions. Canberra should be prepared.