In June, US President Donald Trump announced that the United States would withdraw from the Paris Agreement, a landmark document in the global fight against climate change. Trump said the U.S. would begin negotiations to re-enter the agreement in the hopes that a new agreement would ensure the “fair” treatment of the United States along with its businesses, workers and taxpayers.

The international community reacted quickly to his decision. Leaders of Italy, France, Germany, Britain, Japan, China and other countries all vowed to continue to implement the consensus reached in Paris and stressed that the agreement cannot be renegotiated.

Trump’s decision could impact the United States in two ways. First, the decision will damage the global leadership of the United States while producing no clear benefits. Now, there is a global consensus to combat climate change through sustainable development, new energy and reduction of carbon emissions.

Though the progress will be relatively slow, global economies have all agreed to make the transition to clean energy. One sign of consensus is that, relative to the Kyoto Protocols, many more countries signed the Paris Agreement. While the world is making joint efforts to cope with climate change, Trump administration’s attempt to forego the Paris climate deal will erode the credibility of the US government.

Second, exiting the agreement also will have an adverse impact on the clean energy industry, environmental protection enterprise and new energy automobile enterprises. After Trump announced the decision, many leaders of US enterprises, like Tesla, Apple, Google, Dow Chemical and General Electric, all expressed hope that the United States would stay in the accord.

Tesla CEO Elon Musk said that if President Donald Trump follows through on pulling the United States out of the agreement, he would “have no choice” but to stop advising the White House.

Trump’s decision also influences China in various aspects. Right now, the United States, China and the European Union are three major parties that promote climate governance. The European Union continues to actively promote the cause, including writing the rules for the agreement.

The exit will boost the relationship between China and the European Union. China’s Minister of Foreign Affairs has already made a statement saying the country will strengthen cooperation with European countries to maintain and promote the multilateral process of climate governance.

Therefore, we can foresee that China’s discourse power in climate governance will increase. And China will also enhance cooperation in technologies, manufacturing and marketing with other countries in areas like carbon emission, reusable-energy industries and new-energy automobile.  In the long run, China can be expected to lead the global new-energy industry.
 

 

However, there is also sacrifice to make. The globe will focus on China for carbon emission. China has already committed to taking the path of low-carbon and sustainable development. We will not deviate from this direction. But the endeavor requires substantial input of technology and capital, which involves industrial transformation and redistribution of interest. The joint efforts of the government and enterprises are also needed.

 

Also, China’s energy industry and other related industries may confront an even more disadvantageous environment. They must strive to stay competitive with US enterprises.

 
Lin Baiqiang is from the China Institute for Studies in Energy Policy at Xiamen University.