‘President Trump vs. the rest’

Vanya Walker-Leigh

“Our differences must be made plain and not papered over”, Germany’s Chancellor Angela Merkel’s and host of the G20 leaders’ summit ending in Hamburg last Saturday told journalists at her wrap up press briefing.

Describing the closed door talks between heads of state or government of the world’s leading economies, plus the Presidents of the European Commission and the European Council representing the EU as “difficult”, the final outcome she presented clearly shouted “President Trump vs. the rest” on the key issue of climate change as well as on certain aspects of trade and energy. Analysts who forecast that she and the other nineteen G20 members would sacrifice content to consensus so as to get the US on board for each line of the outcome documents were proved wrong.

So the Summit Declaration states that “we take note of the decision of the United States of America to withdraw from the Paris Agreement...(which) announced it will immediately cease the implementation of its current nationally determined contribution (post-2020 action)...The Leaders of other G20 members state that the Paris Agreement is irreversible...we reaffirm our strong commitment (to it) ...and agree to the G20 Hamburg Climate and Energy Action plan for Growth..in the Annex”.

The talks between the leaders of the world’s 19 largest economies and the EU had been laboriously prepared for months by ‘sherpas’ - senior officials from each G20 members. However, when President Trump took office, US policy on key issues such as trade, energy and climate change became quite different to that of President Obama – but they were not instantly translated into actual negotiating mandates for officials attending international negotiations. So the US ‘sherpa’ did not actively participate in related discussions.

But on 1 June, President Trump announced that he would withdraw the US ratification of the Paris Agreement (2015) on climate change which entered into force on 5 November 2015, and is ratified by another 152 of the 195 countries which signed it. By then he had also made strong attacks on the free trade principle, threatening unilateral protectionist measures as well making clear as his unswerving devotion to fossil fuels (oil, gas and coal) whose use in power stations, transport and industry generates the leading global warming gas – carbon dioxide.

In the months leading up to the summit a series of non-state ‘engagement groups’ held their own high level talks in Germany and issued their own statements on what they wanted to see agreed at the G20 – business, environmentalists, trade unions, scien- tists, youth, local authorities.

While the 4,500 journalists accredited to the summit focused a lot on the peaceful demos and riots in downtown Hamburg, negotiators were much more influenced by these non-state views. Also on what many topline Americans had to say after 1 June, with state governors, business leaders, mayors, academics, labour unions pledging to fulfil Obama’s climate change commitments despite US withdrawal from the Paris Agreement. In a video message to the ‘Citizens’ Global Festival’ in Hamburg, California’s Governor Jerry Brown announced he would host a world leaders climate change conference in California in September 2018.

At his final press conference, France’s President Emmanuel Macron announced a prior leaders’ conference in Paris on 12 December, (the two-year anniversary of the adoption by a UN negotiating conference of the Paris Agreement) to focus on how to mobilise the huge sums of public and private funds needed over the coming decades for climate change mitigation and adaptation in both developed and developing nations. A few days earlier, his government had issued a longterm climate plan involving ending sales of internal combustion vehicles by 2040, phasing out coal, banning further oil exploration throughout France’s territories (ie those overseas as well) and adjusting its entire economic structure to drastically reduce greenhouse gas emissions.

The Hamburg Declaration and annexed Hamburg Energy and Climate Action Plan (which the US did not support) as well other agreed documents register a broad range of policies G20 members have committed to implement in all key sectors, including finance.

With its central goal of limiting the increase in global average temperature above pre-industrial levels to well 2°C below preindustrial levels and pursuing efforts to limit it 1.5°C the 2015 Paris Agreement implies the progressive decarbonisation of all economies by the end of the century.

The Hamburg Climate and Energy Action Plan for Growth (not supported by the US) presents actions to implement the Paris Agreement goals. G20 nations should lead the transition to sustainable and low greenhouse gas emission energy systems, being called upon to communicate by 2020, mid-century long-term low greenhouse gas emission development strategies. “G20 governments will strive to create an enabling environment ... conducive to making public and private investments consistent with the goals of the Paris Agreement as well as with the national sustainable development priorities and economic growth”, the Plan says.

Multilateral Development Banks are invited on to align operations to the above strategies and climate-resilient development. In a concession to the US by the 19, the Declaration says that “the United States of America states it will endeavour to work closely with other countries to help them access and use fossil fuels more cleanly and efficiently and help deploy renewable and other clean energy sources, given the importance of energy access and security in their nationally determined contributions.”

Reliable sources claim that this concession, along with one on trade (see below) were in response to President Trump’s threat to block consensus on the entire summit outcome – unless his irreconcilably different views on fossil fuels and trade were clearly reflected.

On trade the 19 were able to salvage their determination to see continued rules-based international trade rooted in the theory (though yet to be entirely fulfilled) of free trade – in the face of many criticisms not only from civil society groups for this approach but from Trump before and after his election. The Declaration states that “we will keep markets open noting the importance of reciprocal and mutually advantageous trade and investment frameworks and the principle of non-discrimination, and continue to fight protectionism including all unfair trade practices and recognise the role of legitimate trade defence instruments in this regard” – this recognition being the concession to Trump.

“An open and resilient financial system, grounded in agreed international standards, is crucial to supporting sustainable growth” the Leaders’ Declaration says, committing to the finalisation of the Basel III framework “without further significantly increasing overall capital requirements across the banking sector, while promoting a level playing field. We support the Financial Stability Board’s work to analyse the effects of financial regulatory reforms and the structured framework for post-implementation evaluation. Acknowledging that malicious use of ICT could endanger financial stability, we welcome the progress of the FSB’s work and look forward to a stock-take report in October 2017.”

Supporting “a globally fair and modern international tax system” leaders committed to the implementation of the Base Erosion and Profit Shifting package on tax evasion, encouraging all relevant jurisdictions to join the Inclusive Framework and looking forward to the first automatic exchange of financial account information under the Common Reporting Standard (CRS) in September 2017. The international financial architecture and the global financial safety net will be enhanced “with a strong quota-based and adequately resourced IMF at its centre”. The Multilateral Development Banks’ Joint Principles and Ambitions on Crowding-In Private Finance (“Hamburg Principles and Ambitions”) are endorsed with work welcomed on optimising balance sheets and boosting investment in infrastructure and connectivity.