| If there's a chance to slow global warming anytime soon, the world desperately needs a green alternative to the Belt and Road initiative, China's $1 trillion infrastructure project that touts digital connectivity and blockchain ledgering while dropping coal-fired power stations on poor nations. In one case, Chinese engineers dismantled an aging coal plant in Hunan province as part of the country's domestic clean-up effort, and then reassembled it next door in Cambodia. Hunan residents were able to breathe easier while Cambodians got smog. Global emissions were unchanged. The Group of Seven was supposed to have a plan to counter Chinese investments that purport to advance underdeveloped economies while inflicting environmental damage. But the G7 just punted on that. Instead, the world's richest countries now have a plan to make a plan.  Extinction Rebellion protesters demonstrated during the final day of the Group of Seven summit in the U.K. on June 13. The world's richest governments are under mounting pressure to help poor countries fight climate change. Photographer: Hollie Adams/Bloomberg This Week in the New Economy
That's the essence of the U.S.-led "Build Back Better World" (B3W) initiative announced with great fanfare at last weekend's G7 meeting. The group delivered a slogan with little substance beyond a theoretical ambition to focus on climate change, along with health, digital technology and gender equity.
Nor did the G7 put any cash on the table for this (so far) aspirational exercise. The group's most concrete promise? To set up a task force that will report back in the fall.
It would be possible to take the initiative more seriously if its members had fully delivered on pledges already made to help developing countries on the front lines of the climate crisis.
Back in 2009, at the United Nations climate conference in Copenhagen, Denmark, rich countries committed to jointly mobilize $100 billion a year by 2020 to mitigate the effects of climate change in the developing world. But they've fallen short (Bloomberg New Energy Finance estimates the number actually raised at $71 billion last year, counting only public money). Last week, those nations pushed the goal back to 2025 while vaguely promising to "increase and improve" their contributions.  From left, Justin Trudeau, Canada's prime minister, Charles Michel, president of the European Council, U.S. President Joe Biden, Yoshihide Suga, Japan's prime minister, Boris Johnson, U.K. prime minister, Mario Draghi, Italy's prime minister, Emmanuel Macron, France's president, Ursula von der Leyen, president of the European Commission, and Angela Merkel, Germany's chancellor, on the first day of the G7 summit on June 11. Photographer: Hollie Adams/Bloomberg Not only has the G7 failed to respond in any credible way to China's export of its most polluting coal-fired power stations, but it may have set back the entire global climate agenda. The disappointment among developing countries, whose need for climate assistance is growing as their economies reel from the pandemic, threatens the success of the next U.N. climate conference in Glasgow, Scotland.
"This could weaken developing countries' willingness to raise their ambitions, or indeed participate actively in the Glasgow talks," writes Victoria Cuming, the head of global policy at Bloomberg New Energy Finance.
No wonder China believes the U.S. is "very ill indeed," as a Chinese foreign ministry spokesman put it, summing up President Joe Biden's efforts in Europe to build an anti-China coalition. "The G7 had better take its pulse and come up with a prescription," the spokesman said.
In fact, B3W demonstrates China has little to worry about when it comes to Western competition over the Belt and Road, President Xi Jinping's signature foreign policy initiative. B3W didn't even find its way into the final G7 communique, while German Chancellor Angela Merkel emphasized that the group's plan (to make a plan) "is not about being against something, but for something." French President Emmanuel Macron added that the "G7 is not a group that is hostile to China."
But being hostile to China is not the same as pushing back on its Belt and Road environmental practices. A report by the U.S. Council on Foreign Relations notes that developing countries that signed up for Beijing's globe-spanning project "know that China is the leading, and increasingly only, source for financing coal-fired power plants." Some 40% of Belt and Road lending for the power sector in 2018 went to coal projects.  U.S. President Joe Biden Photographer: Tasos Katopodis/UPI Meanwhile, the U.S. is targeting Chinese tech giants and military-linked enterprises as part of a broad sanctions regime linked to human rights and predatory Chinese industrial practices. Jonathan Hillman, a Belt and Road expert with the Washington-based Center for Strategic and International Studies, said that as China is squeezed out of developing markets, "it will double down on the Belt and Road." That will likely lead to an outcome where China continues to get greener domestically (it's by far the world leader in renewable energy) while its client states head in the opposite direction.
Given the outcome of the latest G7 meeting, it's improbable that an effective response will emerge from the White House. Biden's domestic version of "Build Back Better" has already been savaged by congressional Republicans. Its global variant is probably dead on arrival.
Watch the future unfold on June 30. Register here for Bloomberg New Economy Catalyst, a global, 6-hour virtual event celebrating the innovators, scientists, policymakers and entrepreneurs accelerating solutions to today's biggest problems. We will explore what matters, what's next and the what-ifs of climate change, agriculture, biotech, digital money, e-commerce and space through the imaginations and stories of these ascendant leaders. __________________________________________________________ The fourth annual Bloomberg New Economy Forum will convene the world's most influential leaders in Singapore on Nov. 16-19 to mobilize behind the effort to build a sustainable and inclusive global economy. Learn more here. Download the Bloomberg app: It's available for iOS and Android. Before it's here, it's on the Bloomberg Terminal. Find out more about how the Terminal delivers information and analysis that financial professionals can't find anywhere else. Learn more. | 
Post a Comment