Finance ministers grapple over economic threat of climate change
RIYADH, Saudi Arabia — The United States, under pressure from European countries to address the economic threat of climate change, agreed Sunday to include a reference to those risks in a joint statement at the conclusion of a meeting of the world’s top economic leaders.
The inclusion of the term “climate change” in a statement from the Group of 20 finance ministers appeared to be a notable, but subtle, acknowledgment by the U.S. that the threat from rising temperatures was a valid economic concern. The reference, on the third page of the document and at the bottom of a long list of potential risks, said the “financial stability implications of climate change” were being monitored by the G-20’s Financial Stability Board.
The Trump administration does not accept the established science that human activities are the dominant cause of climate change. It has aggressively rolled back environmental regulations, including those aimed at curbing greenhouse gases, over the last three years. President
Donald Trump’s position that these regulations hold back business have left the U.S. at odds with other countries at international forums, regularly threatening to derail official statements, or communiques. But rising temperatures and increasingly frequent and severe weather events have stoked concerns that climate change poses a significant risk to the world economy and the global financial system.
Bruno Le Maire, the French finance minister, said in an interview Sunday that he and Treasury Secretary Steven Mnuchin had a long discussion Saturday evening about the language. While Mr. Le Maire had hoped for something more extensive, he said he believed that progress was made.
“I think he clearly understands that even if we do not share the exactly the same assessment on climate change, there is a need to address the issue within the G-7 and within the G-20,” Mr. Le Maire said of Mr. Mnuchin. “I think that we have a totally different perspective on the risk of climate change — for us, this is clearly one of the major risks. This is a financial risk.”
Mr. Mnuchin’s counterparts were pushing for a more assertive pronouncement of climate change as an economic headwind, leading to last-minute negotiations over how the phrase would appear in the statement. References to climate change as a risk have been excluded from such statements while Mr. Trump has been in office.
At a news conference Sunday, Mr. Mnuchin played down the inclusion, saying it was “merely” a factual reference to work that the Financial Stability Board was already doing.
“I did not bend to pressure from the Europeans,” Mr. Mnuchin said. “Some of the people felt it was relevant to put in.”
The Trump administration has long demonstrated antagonism to combating global warming, including pulling out of the Paris Agreement, the attempted censoring of basic scientific facts and advocating policies of developing more fossil fuels that are responsible for planet-warming emissions.
In recent months, Mr. Mnuchin has faced questions about the consequences of failing to safeguard the environment. He has generally demurred, noting that while he used to drive an electric car — a Tesla — he is not an expert on climate science.
However, he has cast doubt about climate policies that he believes could inhibit growth and under his watch the Treasury Department has rejected policies such as carbon pricing to fight climate change. In December, he said he did not believe that studying the economic risk of climate change fell under the purview of the Financial Stability Oversight Council, the interagency panel he oversees that is charged with monitoring risks to the financial system.