The Journal. - Is China Beating the U.S. on Climate?

Episode Date: November 14, 2024

Leaders from around the world are meeting in Azerbaijan for the U.N.’s COP29 climate conference. With Donald Trump’s recent election victory looming over the event, the U.S.’s role will be diminished. WSJ’s Matthew Dalton explains why this moment might be China’s chance to shine. Further Listening: -The Oil Giant Hosting This Year’s U.N. Climate Summit  -The Fight Over Climate Change's Price Tag  Further Reading: -Trump Victory Leaves China Calling the Shots at COP29 Climate Negotiations  -Welcome to Baku, a City Built on Oil Hosting the World’s Climate Conference  Learn more about your ad choices. Visit megaphone.fm/adchoices

The world's largest annual climate conference kicked off this week. It's known as COP29, and it's taking place in Baku, Azerbaijan. Our colleague Matthew Dalton is an experienced COP attendee, and this weekend he's headed to Baku. How many of these conferences have you been to at this point? This will be my fifth COP. The most interesting thing about them is it's a place where every country of the world almost is represented.

And a lot of times people are dressed in their traditional garb. It's quite a festive and interesting place to be. What are you packing to go to Baku? I'm just packing the boring clothes of a Wall Street Journal reporter. Suits, ties. No suits, actually no, I'll have a few suits. No ties though. No ties. That's where I draw the line. a few suits. No ties though. No ties. That's where I draw the line. Matthew, in his boring reporter outfit, will likely see some members from the United States delegation at COP, probably wearing some suits as well. But the US delegation is now seen

as a lame duck following last week's election. The incoming Trump administration is expected to pull the US away from global climate diplomacy. The US role will be diminished. The US voice will be diminished. It is widely expected that Donald Trump will pull the US out of the Paris Agreement for the second time. He did it during the first administration. Biden brought the US back in. So that really drains the US credibility in the So that really drains the US credibility in the eyes of the world.

And into that void, a new leader is seen as stepping up. China is the colossus of renewable energy right now. They are not only doing it at home, they're increasingly doing it overseas. Everybody's looking to China right now. Welcome to The Journal, our show about money, business, and power. I'm Jessica Mendoza. It's Thursday, November 14th.

Coming up on the show, how China overtook the U.S US as the world's climate leader. How do airplanes fly? What's in this box? What does this thing do? Kids are curious about everything, including guns. Learn how to store your guns securely and make your home safer at Nfamilyfire.org. Brought to you by Nfamily Fire, Brady and the Ad Council.

China and the U.S. are the world's two largest economies and the world's two largest carbon emitters. So for the past few decades, any successful global climate deal has needed to get both superpowers on board. And the US and China each bring very different perspectives to the table. The US represents the developed world, the rich world. China represents the developing world, or at least it has historically. And that is the big divide in the UN climate negotiations. It's developed versus developing.

After years of negotiation, both the US and China finally got on board with a major climate agreement in 2015, the Paris Climate Accords. Here's former President Barack Obama in Paris. Nearly 200 nations have assembled here this week. A declaration that for all the challenges we face, the growing threat of climate change could define the contours of this century more dramatically than any other. The agreement was groundbreaking. Nearly 200 countries agreed to limit global warming to less than 2 degrees Celsius.

That meant cutting greenhouse gas emissions. The accords also included financial commitments from wealthy countries like the US. The rich world would continue to provide finance for developing countries to shift away from fossil fuels and to build infrastructure that would protect these poor countries from the effects of climate change.

And that goes back to the very foundation of all these climate negotiations, which was that it is the rich world that is responsible for most of the warming. We know the truth that many nations have contributed little to climate change, but will be the first to feel its most destructive effects. You were there, right, in 2015. How would you characterize the relationship between China and the US at the time? Like, who was pushing who during these negotiations? So it was the US pushing China.

Back then, China was still the largest emitter. They were the world's biggest coal consumer. And they were building a lot of coal-burning power plants. The US was trying to convince the Chinese leadership to at least scale that back somewhat, to change their trajectory of emissions. So the dynamic was the US was saying, we ourselves consume a lot of energy.

You know, we're going to take the lead and cut our emissions, but you, China, you have to do more. Obama considered the Paris agreement a major achievement of his presidency. But less than a year after it was formalized, Trump was elected president for the first time. And within months of taking office, President Trump announced the U.S. was pulling out of the agreement.

— In order to fulfill my solemn duty to protect America and its citizens, the United States will withdraw from the Paris climate accord. — Then, four years later, Joe Biden became president, and the U.S. was back in. — And as of today, the United States is officially, once again, a party to the Paris Agreement, which we helped put together. — You know, this kind of going back and forth is not helpful.

And people are looking to the U.S. and saying, we can't really depend on you to help us with climate action and to lead this process forward. And that whiplash continues now that Trump is heading back to the White House. He says he wants to pull out of Paris again and ramp up the country's production of fossil fuels. And we will drill baby drill. We're gonna drill baby drill. He wants to pump as much oil and gas as possible.

He has signaled that he wants to open up more federal lands to oil and gas drilling, remove the red tape that exists that limits oil and gas drilling, perhaps environmental reviews that one might normally have to do before you start pumping oil and gas. Very little talk about renewable energy, electric vehicles. As the U.S. has gone back and forth on its climate commitment, China has steadily grown its renewable energy and electric vehicle industries, and it's now the world leader in both.

Which means, at this month's climate conference, countries are turning their attention to Beijing. So, everybody's looking to China, and the question is whether they are going to take that next step and be kind of like an official leader. Will China step up? That's after the break. This episode is brought to you by Walmart. Walmart is fueling American jobs and strengthening communities with an additional $350 billion investment in products made, grown or assembled in America. This commitment to U.S. manufacturing is helping local businesses across the country hire more

people and support their local communities. Learn how Walmart is supporting U.S. manufacturing by visiting walmart.com slash America at Work. Around the time the Paris Accords were signed, China had a serious problem with air pollution. So it might not seem like it, but it's the middle of the day here in Beijing. The air is so polluted that it's darkened the sky. Pollution levels in the Chinese business capital are the highest they've been this year.

The government issued what is known as a yellow alert on Monday, the third highest smog warning. The accords were an incentive for China to address this issue head on. And there was an economic upside too. China is very good at selecting industries for development, throwing a lot of state support behind them and growing them very quickly. And the Chinese leadership became very interested in shifting away from like old manufacturing industries

to new industries, the industries of the future. Unlike in the US, China doesn't have to deal with that pesky back and forth between political parties. They've had one leader in charge for the past decade. And China's president has pushed the government to invest heavily in green energy. China's capacity to build renewable technologies began growing very quickly. That includes solar panels, wind turbines. It also is starting to include electric vehicles,

batteries of all kinds, both for electric vehicles and also just batteries that are installed on the grid. Right. Their clean energy industries were always strong and they became multiples stronger. So under the Paris Agreement, China is considered a developing country, which means not as much was asked of it. But how is China doing in terms of curbing emissions? Yeah, as a developing country, there aren't too many explicit goals, explicit requirements for them to live up to. That's sort of a caveat to what I'm about to say, but generally speaking, they're way ahead.

In 2020, China set a goal of installing 1,200 gigawatts of wind and solar power by 2030. They've already met that goal six years early. And the country has become the world's largest EV manufacturer. China also said it would prevent its carbon emissions from rising by 2030. International climate analysts say that may have already happened. In other words, that emissions in China may have already peaked and are on the way down. So by those metrics, they're doing great. They're doing much better than people could have imagined they could have done.

I mean, I think it's given hope to the idea that the worst effects of climate change can be avoided. Now, there's the fact is, is that they need to be doing a lot more if the world is gonna limit global warming to 1.5 degrees. So China is doing well, they're not doing nearly enough, but the US isn't doing enough either. Now, as countries gather for COP29, Matthew says that one of the big questions he's hearing from the U.S. and Europe is whether or not China should still be considered a developing

country. One of the things they point out is that it's the size of China's total emissions, not just this year but going back all the way to the beginning of the industrial era, are getting close to the size of the emissions of a number of wealthy countries. And so they're saying, look, things are evening out. You are such a large emitter of greenhouse gases now that you've got to take some responsibility for that, more responsibility. Whether China is reclassified could have financial repercussions around the world. Matthew says this year, the main agenda item at COP is to decide how much money

developed countries will contribute after next year. So that is the task at this COP, is to set the target for post-2025 climate finance. And everybody acknowledges, including the donor countries, that the sums that are required to move the developing world to cleaner energy are huge. And people have been talking about multiple trillions of dollars a year. The US and Europe are saying,

we want you China to contribute to this new climate finance goal. We think you've come a long way since the first UN climate treaty was signed in 1992. China's economy has grown by, you know, with multiples and multiples. They are now the biggest manufacturer of all kinds of renewable technologies. They are the unquestioned leader in all of that. China, you should also

be providing some money through the UN climate system. How do you expect that debate to play out? Like, what are you expecting to see happen in the next few days? Well, I'm expecting to see the Europeans and the US and Australia and Japan make that argument. Say China, it's time for you to contribute to some extent. China is going to resist that. And I think the big question is, are the US and China going to get together for some kind of powwow that seals the deal? Why would China resist, though?

Why would China resist stepping up into its already kind of de facto role as the global leader on climate? Well, I think there is an ideological reason behind it. The division in the UN climate world is between developing and developed. And China, and sort of the underscore there, the background is between the West and the Third World

or the developing world or the global South, however you wanna call it. So it's kind of an ideological divide. China doesn't see itself, doesn't want to be seen as a Western country. It's a communist country. It has solidarity with other developing countries. It does hold itself up as a leader of that bloc of the developing countries. So I think China's leadership, they don't want to redefine themselves in that way.

China has agreed to a provision that would allow developing countries to make financial contributions to a new UN fund. But it hasn't made a contribution so far. The country says it will continue to offer assistance to fellow developing countries to the best of its capacity. What strikes you most about the moment that we're in now in the struggle to combat climate change? Well, it's possible we're at an inflection point. It's possible that China's emissions have already peaked, which would be a huge victory in terms of the fight against climate change. It would send a really important signal to the rest of the world that this problem is

manageable. You've really got a lot of investment happening and all kinds of new technologies and solar and wind and clean hydrogen that are coming online. The rest of the world is buying into it to a large extent. Yeah, the progress is not fast enough, but it is happening. Sounds like there are still some questions outstanding, some pretty big ones, but Matthew, you sound kind of optimistic actually,

which I don't think I was expecting. Yeah, I am a kind of optimistic. I think that limiting global warming to well under two degrees is possible. Even if 1.5 degrees looks really hard, I do think well under two degrees is, yeah, it's within reach. Well, thank you so much again for taking the time to chat with us.

I hope you enjoy Ka'ap this year. Thank you, Jess. Appreciate it. Yeah, apparently I'm told that Azeri cuisine is very good, so... Well, keep us posted. Send some pictures. Oh, okay. [♪ music playing, sound effects of the radio playing, and music fades out. [♪ music ends, music starts again.

[♪ music starts again. [♪ music starts again. That's all for today, Thursday, November 14th. The Journal is a co-production of Spotify and The Wall Street Journal. If you like our show, follow us on Spotify or wherever you get your podcasts. We're out every weekday afternoon. Thanks for listening. See you tomorrow.