As globalization encounters setbacks, the pandemic and localized conflicts overlap, inflation and supply chain disruptions coexist, and energy markets fluctuate, the vision of China and Europe has never been more aligned: to maintain a stable global order, boost economies dampened by the pandemic and social unrest, and achieve lower-cost low-carbon transitions through cooperation on climate change.
In recent years, China-EU climate cooperation has experienced a “honeymoon period” of win-win cooperation, as well as a “low period” disrupted by various factors. Currently and for some time to come, it mainly presents three major characteristics:
First, climate cooperation is increasingly difficult to separate from confrontations and competitions in other areas, exhibiting more complexity and fragility. Global climate governance has become an arena for major powers to compete for influence and control of the narrative. This also means that actions to address climate change will inevitably overlap with international arenas like trade, technology, etc., making climate cooperation difficult to “depoliticize.”
After the Russia-Ukraine conflict, the EU and the US have become even more deeply bound on issues of global governance. Under the current major power relations based on shared values and “taking sides” mindsets, relations are more fragile. The EU and European countries are more cautious about relations with China, and are accelerating the search for other green cooperation partners globally.
Second, the EU is establishing a new paradigm for global carbon reduction, using this to shape its advantages in climate cooperation. After China made its “dual carbon” goals commitment, Europe has continually expressed concerns about China’s specific emission reduction measures. The EU has also learned from past EU-China solar PV trade frictions, becoming more prudent and conservative regarding trade and technology cooperation with China, and plans to set low-carbon standards and rules ahead of time, like the Carbon Border Adjustment Mechanism (CBAM) draft. The passing of this draft marked the start of concrete implementation of key parts of the European Green Deal, which will have huge impacts on global climate governance in both temporal and spatial dimensions, accelerating the shift of global economic development towards a green low-carbon direction.
In the future, international climate cooperation will exhibit this kind of situation: some countries will formulate advanced green emission reduction policies, technologies and standards, utilize international trade policies to establish frameworks for climate cooperation, formulate rules for climate competition, and continue consolidating their advantageous positions in the green low-carbon arena, maintaining long-term control of the discourse power. The emergence of this new situation will also place higher demands on China’s low-carbon transition timeline.
Third, climate change remains an adhesive and propellant in China-EU relations, and the green partnership is an important component of bilateral relations. Europe is very clear that addressing climate change cannot bypass China, and China’s energy transition is key to global climate governance. China-EU cooperation will greatly reduce the risks and costs arising from uncertainties in the transition. Therefore, even in 2021 when bilateral relations were relatively fragile, China and the EU still held two rounds of high-level environmental and climate dialogues, and conducted several high-level dialogues.
For Europe, when it comes to global environmental governance ambitions, determination to fulfill commitments, and policy implementation capabilities, China is undoubtedly a reliable ally and like-minded partner. The European Green Deal released by the EU in 2019 and China’s 1+N policy system introduced in 2021 resonated with each other, demonstrating convergent thinking on climate challenges and transition pathways – combining low-carbon transitions with economic development, and encompassing holistic and specific aspects of innovation and transition pathways. Therefore, the China-EU green partnership is a window and bright spot in bilateral relations, and climate cooperation still has broad prospects.
On one hand, China needs to accelerate its transition and prepare to meet green thresholds. Green “thresholds” like the CBAM draft that are continuously being added increase environmental and technological innovation costs for Chinese companies seeking to operate in Europe and even globally in the future. Although in the short term, mechanisms like CBAM have not had huge impacts on exports by Chinese companies, in the long run, becoming greener and lower carbon has become the strategic direction for upgrading global value chain divisions of labor. China needs to recognize the importance the EU places on establishing and maintaining international standards and rules in the low-carbon arena; more urgently needs to accelerate domestic low-carbon transitions, further catalyzing the guiding and propulsive role of domestic markets for technological innovation through institutional reforms and policy innovations; while also actively conducting international cooperation in areas like low-carbon technologies and sustainable finance, grasping discourse power regarding access thresholds in green industries, and helping Chinese companies increase capabilities in international competition and promote the development of Chinese industrial and value chains.
On the other hand, China and Europe face common transition dilemmas, and should strengthen synergetic energy development. Faced with the energy crisis arising from the Russia-Ukraine conflict and medium to long term emission reduction dilemmas, Europe has had no choice but to temporarily embrace coal. Similarly, under the strategic framework of ensuring energy security, coal has solidified its position in China’s short-term energy development. From this perspective, Europe and China both face similar pathway difficulties – how to balance short-term supply guarantees and long-term emission reductions, and coordinate the relationship between coal power and renewable energies. This requires not just technological breakthroughs, but also forward-looking planning and actions, as well as strengthening bilateral and multilateral cooperation with a more inclusive and open attitude.
Vertically, the two sides can continue to tap cooperation potential. China and Europe have certain experiences and foundations for cooperation in the energy arena, and Chinese and European companies and research institutions have already cooperated on areas including offshore wind, fuel cells, energy storage and other technology R&D and project development.[1] In the future there is still huge potential and space for cooperation in areas like renewable energies, especially green hydrogen. The Russia-Ukraine conflict has disrupted Europe’s existing energy supply systems and energy strategy planning. Against this backdrop, the EU’s REPowerEU energy plan has greater momentum, with further increased investments in the renewable energy arena; meanwhile, China has leading competitiveness, vast markets, and prospects for further decreasing R&D costs in areas like wind power, solar PV, electric vehicles and batteries, which can all serve as foundations for deepening cooperation.
Horizontally, the two sides can diversify cooperation mechanisms and expand mutual trust foundations in areas like standards formulation and technology R&D. During COP26, China and the EU released a Common Ground Taxonomy for Sustainable Finance, promoting mutual understanding and cooperation regarding green investment and financing standards. As the world’s largest green finance markets, the two sides can continue expanding cooperation scopes building on the International Platform on Sustainable Finance. They can also establish special working mechanisms to facilitate technological cooperation and R&D in the energy arena, and where necessary incorporate the establishment of such working mechanisms into high-level dialogues, broadening possibilities for cooperation and creating foundations and opportunities for cross-border industry and corporate cooperation.
From an overall and long-term perspective, the green actions of China and Europe have already established broad platforms for climate cooperation. They should reinforce common visions and consolidate cooperation foundations. While achieving their respective green goals, they should also be able to enhance their own economic resilience, lead the breaking of global energy deadlocks, and promote global low-carbon transitions and green recoveries.
