CONTEXT: In late 2020, Chinese leaders made a climate change announcement that is interpreted in the West as a climate action pledge with the widely held belief in the West that the announcement means that the world’s largest fossil fuel emitter will cut emissions to fight climate change.

HERE IS THE CHINESE ANNOUNCEMENT AS REPORTED BY THE BBC

China will aim to hit peak emissions before 2030 and for carbon neutrality by 2060, President Xi Jinping has announced. Mr Xi outlined the steps China will take in a videolink to the UN General Assembly. The announcement is being seen as a significant step in the fight against climate change. China is the world’s biggest source of carbon dioxide, responsible for around 28% of global emissions.

BEFORE CHINA’S 2020 CLIMATE ACTION PLAN THEY HAD A 2015 CLIMATE ACTION PLAN: “Ahead of the Paris climate summit, Prime Minister Li Kegiang reaffirmed a November agreement to cap emissions by 2030. China plans to cut CO₂ emissions 60 percent below 2005 levels and increase renewable energy consumption 20 percent by 2030. BBC”

CHINA’S ECONOMIC INTEREST IN CLIMATE ACTION

SOLAR PANEL MANFACTURE AND EXPORT

WIND TURBINE MANUFACTURING AND EXPORT

ONLINE COMMENTARIES IN THE WEST ON CHINESE CLIMATE ACTION DECLARATIONS

1. ECOWATCH: China’s President Xi Jinping surprised the global community recently by committing his country to net-zero emissions by 2060. China currently accounts for about 28% of global carbon emissions – double the U.S. contribution and three times the European Union’s. Meeting the pledge will demand a deep transition of not just China’s energy system, but its entire economy. It remains to be seen whether China’s climate promise is genuine, or simply a ploy to win international favor.
2. XINHUANET: There is no doubt that efforts from China will play a major role in shaping how the rest of the world progresses on climate action, especially in the absence of U.S. federal leadership.
3. GUARDIAN: China will reach carbon neutrality before 2060 and ensure its greenhouse gas emissions peak in the next decade, Xi Jinping has told the UN general assembly. China will scale up its intended nationally determined contributions [under the Paris climate agreement] by adopting more vigorous policies and measures, the Chinese president said, calling for a “green recovery” from the coronavirus pandemic. The forthright commitment will give fresh impetus to the UN’s efforts to galvanise action on the climate crisis which has been flagging.
4. CHINA DAILY: China’s pledge to achieve carbon neutrality by 2060－that is, netzero carbon emissions－puts the country on a transformative development path. Net-zero carbon emissions will be a ginormous turnaround in four decades and has to be done without too much negative impact on economic development. President Xi Jinping’s announcement at the United Nations on Sept 22 marked the first time China has set an absolute rather than a carbon-intensity target tied to GDP growth. In other words, it is much more ambitious. The pledge by China, as one of the world’s biggest carbon emitters, is just beginning to be digested around the world and will reverberate across energy, commodities and financial markets for a long time. Its new pledge represents a leading bid in meeting the climate-change mitigation challenge. The implications are profound.
5. DIALOGO CHINO: In a virtual address to the 75th UN General Assembly on 22 September, Chinese President Xi Jinping said China would reach peak emissions before 2030 and strive to reach carbon neutrality before 2060. These pledges are a significant step forward in climate ambition from the world’s largest carbon emitter and second largest economy. All governments are required to deliver tougher climate targets under the Paris Agreement ahead of COP26, which were delayed until 2021 because of Covid-19. With commitments from the EU and China, well over a third of global emissions will be covered by new, tougher targets.
6. NYT: China’s Pledge to Be Carbon Neutral by 2060: Under international pressure to do more to address global warming, Xi Jinping made a surprise commitment to drastically reduce emissions. Now comes the hard part – actually doing it.

CRITICAL COMMENTARY AND CONCLUSIONS

(1) China is the world’s largest emitter of fossil fuel emissions. With a population of 1.4 billion and per capita emissions of 7.2 metric tonnes of CO2 per person, China’s total emissions are 10.08 gigatons of CO2 that represents about 27.5% of global emissions. The climate change focus on China derives from this significant statistic. Overlooked in this statistic is that these emissions come mostly from export oriented manufacturing and not from consumption with much of the industry consisting of overseas manufacturing facilities of Western business enterprise. Although China is the largest economy in the world with a gross national GDP of $27 trillion in 2019, this figure is driven largely by industry and by population and not by consumption and living standard. A partial list of Western business enterprises that operate their factories in China, provided by JIESWORLD.COM, appears below. These factories and their products are of the West by the West and for the West but their emissions appear in China’s account. The West has exported its emissions to China.

(2) An important sector of export oriented industrial production in China that contributes to much of the fossil fuel emissions noted above, is the manufacture of solar panels, wind turbines, and electric cars for export. The importer of these products benefits from emission reduction but the emissions for their manufacture accumulate in China’s emission account. In 2019 China exported about $18 billion of solar panels with total energy production capacity of more than 200 GW. The export of wind turbines that year was $12 billion with energy capacity of more than 400 MW. Thus, much of the West’s manufacturing emissions including the emissions from the manufacture of renewable energy equipment is offloaded to China. {Footnote: China’s domestically installed renewable energy capacity is about 400 GW divided almost equally between wind and solar}.

(3): With regard to the wealth of China described as the largest economy in the world, it should be noted that the gross GDP of the country was $14.4 trillion in 2019 compared with $21.4 trillion for the USA but in terms of purchasing power parity (PPP), the adjusted PPP GDP are China $25.3 and USA $17 trillion. This PPP-GDP comparison is the basis of the assessment that China is the largest economy in the world – but this direct comparison of PPP-GDP as a measure of the wealth and standard of living is flawed in a financial context because the poorer you are and the lower your cost of living, the higher your PPP-GDP gets. The GPD assessment also contains the hidden flaw that China’s GDP derives not from consumption but from export oriented industrial production that makes goods for export to the West at lower cost than would be possible in the West. In terms of per capita consumption, China lags way behind the West with $3,224 per person in 2019 compared with $45,000 in the USA. The analysis provided above implies that significant social and structural differences make it impossible to make a direct comparison of gross national GDP and that therefore from the consumer’s point of view, China is not the richest country in the world.

(4) A similar error is found in a direct comparison of emissions. First, emissions in China are primarily industrial emissions and not consumer emissions. Second, much of these emissions come from two sources that have a direct link to the West. These are, (i) Western firms that have chosen to locate their factory in China, and (ii) Chinese factories that are making solar panels and wind turbines for the West. The ownership of these emissions must therefore have a more rational distribution than a single minded consideration of national boundaries. An implication of these complexities is that climate action emission accounting must be global because it cannot be understood on a country by country basis. This issue is discussed in a related post on this site: LINK: https://tambonthongchai.com/2020/05/22/climate-catch22/

(5) There is also a cultural issue in the emission confrontation between China and the West. Absolute literal truth no matter how ugly is a foundational principle of Western Civilization. Confucian philosophy contains the Li Principle. It affirms that manners are a primary means by which we express moral attitudes and carry out important moral goals. Confucian views on ritual extend this insight further by emphasizing the role that manners play in cultivating good character and in finding the conceptual boundaries of manners. What we call etiquette, social customs, and ritual Confucians see as expressions of Li , something we would understand as decorum. It expresses moral character and attitude. Li expresses the principle that good etiquette and good manners cultivate and express good intentions and good character. {SOURCE: Cline, E.M. The Boundaries of Manners: Ritual and Etiquette in Confucianism. Dao 15, 241–255 (2016). https://doi.org/10.1007/s11712-016-9490-1 (abbreviated and edited)}

(6) CONCLUSION: We propose in this post that the arguments presented in items (1) to (4) above imply that a confrontational attitude of the West with respect to China’s emissions contains serious weaknesses because the complexity of this issue is not taken into account. The Chinese response to Western demands for a greater climate action role of China is best understood in this light and in terms of the principle of Li in Confucianism.

An additional consideration is that a demand that China should live up to its commitments in the Paris Accord overlooks the weaknesses and inconsistencies in the details of what is called the “Paris Agreement” as discussed in a related issue on this site: LINK: https://tambonthongchai.com/2020/04/04/11245/

Here Xi Jinping has tried to calm the discourse with declarations of good intentions and expressions of good character that should probably be understood in terms of the Principle of Li in Confucianism. A bitter confrontation is not in either party’s interest because of the deep economic linkages described above. Yet, these expressions of Li may have been taken literally in the West. The communication is likely made difficult by cultural differences.

A SMALL SAMPLE OF THE LONG LIST OF WESTERN BUSINESSES THAT OPERATE THEIR FACTORIES IN CHINA

Abercrombe & Fitch, Abbott Laboratories, Acer Electronics, Adidas, AGI- American Gem Institute, Agrilink Foods, Inc., Allergan Laboratories, American Eagle Outfitters, American Standard, American Tourister, Ames Tools, Amphenol Corporation, Amway Corporation, Analog Devices, Inc., Apple Computer, Armani, Armour Meats, Ashland Chemical, Ashley Furniture, Audi Motors, AudioVox, AutoZone, Inc., Avon, Banana Republic, Bausch & Lomb, Inc., Baxter International, Bed, Bath & Beyond, Belkin Electronics, Best Foods, Big 5 Sporting Goods, Black & Decker, Body Shop, Borden Foods, Briggs & Stratton, Calrad Electric, Campbell ‘s Soup, Canon Electronics, Carole Cable, Casio Instrument, Caterpillar, Inc., CBC America, CCTV Outlet, Checker Auto, Cisco Systems, Chiquita Brands International, Claire’s Boutique, Cobra Electronics, Coby Electronics, Coca Cola Foods, Colgate-Palmolive, Colorado Spectrum, ConAgra Foods, Cooper Tire, Corning, Inc., Coleman Sporting Goods, Compaq, Crabtree & Evelyn, Cracker Barrel Stores, Craftsman Tools, Cummins, Inc., Dannon Foods, Dell Computer, Del Monte Foods, Dewalt Tools, Dial Corporation, Diebold, Inc., Dillard’s, Inc., Dodge-Phelps, Dole Foods, Dow-Corning, Eastman Kodak, EchoStar, Eclipse CCTV, Edge Electronics Group, Electric Vehicles USA, Inc., Eli Lilly Company, Emerson Electric, Enfamil, Estee Lauder, Eveready, Fisher Scientific, Ford Motors, Frito Lay, Furniture Brands International, Gateway Computer, GE General Electric, General Foods International, General Mills, General Motors, Gentek, Gerber Foods, Gillette Company, Goodrich Company, Goodyear Tire, Gucci, Haagen-Dazs, Harley Davidson, Hasbro Company, Heinz Foods, Hershey Foods, Hitachi, Hoffman-LaRoche, Holt’s Automotive Products, Hormel Foods, Home Depot, Honda Motor, Hoover Vacuum, HP Computer, Honda, Honeywell, Hubbell Inc., Huggies, Hunts-Wesson Foods, ICON Office Solutions, IBM, Ikea, Intel Corporation, J.M. Smucker Company, John Deere, Johnson Control, Johnson & Johnson, Johnstone Supply, JVC Electronics, KB Home, Keebler Foods, Kenwood Audio, Kimberly Clark, Knorr Foods, Kohler, Kohl’s Corporation, Kraft Foods, Kragen Auto, Land’s End, Lee Kum Kee Foods, Lexmark, LG Electronics, Lipton Foods, L.L. Bean, Inc., Logitech, Libby’s Foods, Linen & Things, Lipo Chemicals, Inc., Lowe’s Hardware, Lucent Technologies, Lufkin, Mars Candy, Martha Stewart Products, Mattel, McCormick Foods, McKesson Corporation, Megellan GPS, Memorex, Merck & Company, Mitsubishi Electronics, Mitsubishi Motors, Mobile Oil, Molex, Motorola, Motts Applesauce, Multifoods Corporation, Nabisco Foods, National Semiconductor, Nescafe, Nestles Foods, Nextar, Nike, Nikon, Nivea Cosmetics, Nokia Electronics, Northrop Grumman Corporation, NuSkin International, Nvidia Corporation, Office Depot, Olin Corporation, Old Navy,
Olympus Electronics, Orion-Knight Electronics, Pacific Sunwear, Inc., Pamper’s, Panasonic, Pan Pacific Electronics, Panvise, Papa Johns, Payless Shoesource, Pelco, Pentax Optics, Pep Boy’s, Pepsico International, Petco, Pfizer, Inc., Philips Electronics, Phillip Morris Companies, Pierre Cardin, Pillsbury Company, Pioneer Electronics, Pitney Bowes, Inc., Plantronics, PlaySchool Toys, Polaris Industries, Polaroid, Post Cereals, Pfister, Pringles,
Praxair, Proctor & Gamble, PSS World Medical, Pyle Audio, Qualcomm, Quest One, Ralph Loren, RCA, Reebok International, Reynolds Aluminum, Revlon, Rohm & Hass Company, Samsonite, Samsung, Sanyo, Shell Oil, Schwinn Bike, Sears-Craftsman, Sharp Electronics, Sherwin-Williams, Shure Electronics, Sony, Speco Technologies, Skechers Footwear, SmartHome, Smucker’s, Solar Power, Inc., Stanley Tools, Staple’s, Steelcase, Inc., STP Oil, Sunkist Growers, SunMaid Raisins, Sunkist, Switchcraft Electronics, SYSCO Foods, Sylvania Electric, 3-M, Tamron Optics, TDK, Tektronix, Inc, Texas Instruments, Timex, Timken Bearing, Tommy Hilfiger, Toro, Toshiba, Tower Automotive, Toyota, Toy’s R Us, Inc., Tripp-lite, Tupper Ware, Tyson Foods, Uniden Electronics, Valspar Corporation, Victoria ‘s Secret, Vizio Electronics,
Volkswagen, VTech, WD-40 Corporation, Weller Electric Company, Western Digital, Westinghouse Electric, Weyerhaeuser Company, Whirlpool, Wilson Sporting Goods, Wrigley, WW Grainger, Inc., Wyeth Laboratories, X-10, Xelite, Xerox, Yamaha, Yoplait Foods, Yum Brands, Zale Corporation.