Day Six: The US and China, What’s Going Down in Lima?


When the US and China agreed their historic climate deal a few weeks ago pundits predicted an end to the so called climate ‘firewall’ that has divided the developed and developing world for years.  For the uninitiated, the firewall is a categorisation of all the countries in the world, divided into Annex 1 which corresponds broadly to developed countries, and Non-Annex 1 which corresponds to developing nations (see my blog “Busting the Jargon: an ABC to the COP”).

The firewall, which was agreed in Rio back in 1992, is the third rail of climate politics because responsibilities and funding are allocated in accordance with the division it creates. Until now, eliminating the firewall has not been possible because Non-Annex 1 countries, those generally at the sharp end of climate change, fear that they will end up with less money and greater responsibility to solve climate change problems which they contend were created by the developed world in the first place.

The firewall has a number of anomalies which continue to bedevil progress at Climate Change talks, perhaps the greatest of which is the fact that China remains a Non-Annex 1 Country. Non Annex 1 status means that China has not contributed a cent to the $10bn Green Climate Fund - the principal financial instrument in the fight over global warming. This despite the fact that China is the richest country in the world, with a GDP of $17.6 trillion, nearly a quarter of global GDP, and also the single largest polluter on the planet, emitting a quarter of all global CO2 emissions (an increase of 110% in a decade).

It now appears that the climate change deal China struck with the US was in part a play by China to stave off any discussion of the firewall.  As part of the deal, China is committing nearly $2 trillion to the development of renewable energy at home, which is in itself laudable.  However spending money at home is not the same as investing in projects to help developing nations mitigate climate change or adapt to its consequences. Indeed the presence of the firewall means that the US (and others) in theory would continue to fund China’s mitigation and adaption measures. You can see why cracks are emerging.

The Pre-Lima US-China agreement was quite a coup.  It certainly shook up the EU, which had expected to retain its near exclusive role of global climate leadership. The deal was widely applauded at the time, but some are now re-examining the detail, and coming to a different conclusion.  If the COP20 agreement does not remove the firewall or redefine the country membership of the two annexes, then the fear is that China will be excused the obligations that legitimately fall to a wealthy nation and great polluter.

And what of America?  Well, rumour has it that the US is hoping for a ‘goldilocks agreement’, with commitments which are not too big, and not too small but just enough to get us on the road to Paris.  America is also working hard to ensure that what emerges from Lima is more non-binding than it is binding, not because the US intends to welch on its commitments but because a binding package would have to pass through Congress.  With the success of the Republican in the recent elections, safe passage of any bill is anything but assured.  The EU continues to fight for binding commitments.

As an aside, Italian Environment Minister Gian Luca Galletti, who is negotiating on behalf of the European Council, told us that emerging negotiating text had ballooned to 68 pages, more than doubling the size of the document not one paragraph of which has been agreed. And the talks close tomorrow.