China flexes heft in international climate finance

China flexes heft in international climate finance

Has China taken the mantle of climate leadership?

Attendees stand in front of the China Pavilion during the UN Climate Change Conference (COP30) in Belem, Brazil. (REUTERS)

Goings on in Belem at the COP30 climate conference would suggest so – and not just because of the scale of China’s pavilion.

Beijing is backing developing countries on the most contentious issue at COP30, article 9.1 which mandates that developed nations provide climate finance to assist developing country parties with their climate change mitigation and adaptation efforts, negotiators said.

“China is fighting for developing countries. There is no ambiguity that they are in the developing bloc as per United Nations Framework Convention on Climate Change,” said a developing country negotiator. “This may help get a balanced package out of Belem,” he added.

To be sure, India isn’t far behind either.

The countries have been moving in lockstep on all major finance positions – a separate agenda item on 9.1, treating 9.1 as the backbone of the Paris Agreement, and tying mitigation ambition to predictable finance, the negotiators added.

On adaptation finance, both have insisted that any “ambition” conversation is meaningless without scaled-up public finance from developed countries. They’ve coordinated interventions that frame adaptation as grossly underfunded and demand new, additional, predictable support. On trade, they’ve jointly opposed unilateral trade measures or UTMs. Both argue UTMs are trade-restrictive, unilateral, and incompatible with equity. India frames UTMs as barriers that hurt developing countries; China backs the same line and stresses that climate ambition cannot be linked to trade conditionalities. In one consultation where the Chair opened the meeting saying “this is a collective therapy session,” India (for LMDCs) immediately shot back that therapy should be mandatory, not voluntary. China jumped in with: “Not just therapy. We need yoga and a massage,” one of the negotiators said.

There is also a market dimension to this leadership

For solar and wind components, China holds a share of at least 60% across all markets. China is by far India’s largest trade partner when it comes to sectors such as solar PV and batteries. As of 2017, India was actually the top recipient of Chinese solar PV exports in the world, at roughly $3.5 billion worth of goods, according to a white paper by the School of Global Policy and Strategy at University of California, San Diego.

HT reported on November 10 that India and China will be major markets that will lower the price of energy transition globally because both countries have embraced this transition in a very clear way, quoting comments by COP30 President, André Corrêa do Lago on the opening day of COP30.

Responding to a question on the role China is assuming in the climate talks during a press conference, Lago said: “In an extraordinary way because they (China) added the elements that I believe were missing. One of them is scale, the other is technology and the other is the fact that as a developing country needs to bring solutions that are affordable to more people. So I don’t need to say how important China has become for EVs, for solar panels, for wind, for batteries…,” Lago explained.

Negotiators said that China, which is the largest greenhouse gas emitter in the world, is positioning itself to fill the void created by the US’ exit, especially because it also has economic interest in the green transition. “Earlier this year, at a COP event in April , the Leaders’ Summit on Climate and Just Transitions, President Xi Jinping made a strong pitch for China to remain committed to global climate goals,” Pooja Vijay Ramamurthi, fellow, Centre For Social and Economic Progress said last week.

China may call for the continuance of multilateral platforms, seeking countries to encourage constructive climate negotiations. Rather than keeping a low profile, it is expected that China will portray itself a champion of green transitions, she added.

This comes even as the EU isn’t doing enough for the cause.

“The EU is embarking on a multi-layered, multi-front climate-trade confrontation, risking both capitulation to Trump on one side and alienating many in the Global South on the other. The greatest danger is that it ultimately fails to achieve its intended objectives—gaining geopolitical partners, enhancing competitiveness, or reducing emissions,” said Li Shuo, Director, China Climate Hub, Asia Society Policy Institute in a statement.

As a result, it has been left to India and China to show the way, said an expert.

“India and China’s expanding clean-energy trade has the potential to define Asia’s decarbonization trajectory. As COP30 begins, their collaboration shows that the future of the energy transition lies not just in moving green hardware across borders, but also in sharing the digital and behavioral innovations that make renewable systems work reliably. By pairing China’s manufacturing depth with India’s growing demand for flexible, tech-enabled energy solutions, the region is demonstrating that integration—of markets, data, and design—can accelerate both growth and decarbonization,” said Teevrat Garg, associate professor – economics, at the University of California, San Diego, in a statement.

On Wednesday, Union Cabinet Minister for Environment, Forest & Climate Change Bhupender Yadav met Liu Zhenmin, Special Envoy for Climate Change, China, on the sidelines of COP30. “Our discussions involved matters related to co-ordination between LMDC countries in the ongoing developments in COP30, with particular focus on maintaining the integrity of the Paris Agreement,” Yadav wrote on X.

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