If you think trade wars are bad, just wait for the bill on climate change
WHEN US President Donald Trump met with Chinese President Xi Jinping this weekend at the G20 in Argentina, the focus was on the escalating trade war between the two nations. Contrary to Trump’s early claims that trade wars are easy to win, this dispute is beginning to disrupt segments of the American economy, from small farmers to auto giant General Motors.
But the United States and China, the world’s two largest economies, also need to confront another more pernicious issue – the long-term threat from climate change.
Both nations have high stakes in this. China emits more carbon dioxide than the United States and the European Union combined. And despite taking tonnes and tonnes of CO2 from the air in recent years, the United States is still the world’s second largest emitter of the greenhouse gas that scientists warn is a catalyst for extreme climates.
And therein lies the problem. Shortsighted and counterproductive tariff wars risk jobs, impact the prices of imported and exported goods, create uncertainty for US businesses with overseas operations and disrupt complex supply chains. The generational impact of extreme climate will do the same but will be many times more devastating and permanent.
Neither major economy can afford to be on the wrong side of the future. More US companies now factor the impact of extreme climate into their economic risk forecasts. Several states and local governments have adopted policies to encourage businesses to operate in less fossil-fuel intensive ways. And globally, some nations are trying to adhere to the standards set under the Paris Agreement on climate that the US has abandoned.
The United States must not further abdicate leadership on the transition to a cleaner and greener planet. China already has 3.5 million jobs in clean energy, by far the most in the world.
The nation also supplies about two-thirds of the world’s solar panels, half of the world’s wind turbines and has plans to invest US$367bil (RM1.5 trillion) in renewable solar, wind, hydro and nuclear by 2020, an investment that is supposed to create about 10 million jobs.
Rather than continuing the tariff war, the United States should be focusing on doing what it takes to stay ahead of global economic tran-
sition. But that is difficult as long as Trump continues to refute the warning of over 300 government and private sector experts of catastrophic impacts on human health, safety, quality of life and economic growth in the United States.
Worse, it was reported that Trump’s team will “set up a sideevent promoting fossil fuels” including coal at the UN global climate summit which is starting tomorrow in Katowice, Poland.
The most productive outcome for the two countries in Argentina would be to pursue broader dialogue to remove tariffs, promote free market trade and address the climate threat.
The United States must not awaken decades from now to discover that rivals like China have a lock on clean energy jobs that we should have created or that we’ve forever compromised our present and future.