Wednesday, November 01, 2017

Is China the Leader UN Climate Talks Need?

Xi Jinping’s trillion-dollar overseas investment strategy has not caught up with his green rhetoric, environmentalists warn as countries head to Bonn climate summit.



President of China Xi Jinping (Photo Credit: Kremlin) Click to Enlarge.
China is more assertive than ever about its climate leadership ambitions, as 195 countries head to Bonn for the annual UN summit.

At a five-yearly party congress in mid-October, president Xi Jinping for the first time spelled out China’s ambition to take up “the driving seat” of international debate on climate change.

Many are looking to the world’s biggest emitter to fill the leadership role that Donald Trump’s US has vacated.  Chinese officials take pride in the country’s contribution to cementing the Paris climate accord and its shift towards less carbon-intensive growth.

“Xi’s high profile announcement at the party congress, the most important political gathering, effectively ends domestic debates about whether China should step up,” says Greenpeace senior advisor Li Shuo.

Yet the country’s biggest influence over global affairs comes with its trillion-dollar overseas investment plan, known as “belt and road”.  This has a huge carbon footprint, experts warn.

Hailed by Xi as the “project of the century”, the strategy spans 69 countries, rolling out infrastructure that could make or break the Paris agreement.

“Leadership is not self claimed.  People will look at what you do, both domestically and internationally.  China has indeed made great endeavors to decarbonize its economy at home,” says Wu Changhua, China/Asia director for Jeremy Rifkin Office.

”Internationally, however, this contradiction between overseas climate footprint and the leadership rhetoric is yet to be recognized by Chinese officials and investors.”

At a belt and road summit in May, Xi promised to stick to the concept of “green development” and establish “an international coalition for green development”.  Several ministries – including environment, foreign affairs, commerce and national development and reform commissions – in May issued guidance for the “green belt and road initiative”.

Liu Youbin, a spokesperson for the environmental ministry, said on Tuesday the ministry was guiding Chinese enterprises to “abide by local environmental regulations at host countries” for the belt and road projects.  Some Chinese companies are adopting stricter environmental standards than requested by local law, he added.

But so far, in government’s grand plan for the belt and road initiative, there are few guidelines for Chinese investors and enterprises to follow in terms of projects’ climate impact, according to Yang Fuqiang, a senior adviser on climate and energy with the Natural Resources Defense Council’s China program.

“The investment in coal-fired power plants is so intensive in some countries, for instance Pakistan, that might even jeopardize the 2 degree limit of temperature rise set in the Paris Agreement,” says Yang.

In 2016 alone, state-backed China Development Bank, Export-Import Bank of China and China Silk Road Fund financed over $4 billion worth of overseas coal projects, according to data collected by NRDC.  That accounts for half of the foreign coal investment by G20 countries.

Statistics by Global Environment Institute (GEI) show Chinese investment in overseas coal projects surged between 2013 and 2015, filling a gap left by western institutions such as the World Bank.

That is because Chinese lenders are still very much focusing their risk analysis on credit, market, and compliance, while paying insufficient attention to social and environmental risks, says Bai Yunwen, a researcher with Greenovation Hub, a Chinese environmental group.

There is a risk of Chinese companies exporting excessive or obsolete production capacity, adds Yang, giving the example of a cement plant China built in Kazakhstan using outdated technology.

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