Is a new battle just breaking out here in front of the eyes of the world community over who will be the first to achieve Carbon Neutrality?
Player 1: China with a strong implementation
China and its President Xi Jinping had already set high goals for themselves with the 14th Five-Year Plan (2021 to 2025). Before 2060, the world’s largest developing country is to become CO2 neutral.
Achieve CO2 neutrality in record time
“China, as the world’s largest developing country, will complete the world’s most dramatic reduction in carbon emission intensity, and realize carbon neutrality from carbon peaking in the shortest time in global history,” Xi said at the China-France-Germany video summit.
Chinese steel industry already under massive pressure
Effects of this are already being felt in the steel industry. Entire provinces in China are having to reduce the output of their blast furnaces by millions of tons. Entire plants are simply being shut down. Who is affected by these cut-backs? Old, small and inefficient plants that run counter to China’s high climate targets.
West says steel tonnage will only be relocated – really?
Of course, there is initial criticism here, especially from the West, that production would simply be relocated and steel tonnage would not be significantly reduced. The Europeans are currently boasting that they have already emitted 24% less CO2 since 1990, but that their economy has grown by 60% – an achievement not to be sneezed at. But makes one look at the typical arrogance in Europe: Elsewhere, of course, such a thing is impossible.
Player 2: Moral Europe
After much wrangling, Europeans have “provisionally” agreed to reduce greenhouse gas emissions by at least 55% by 2030.
“This is a landmark moment for the EU. We have reached an ambitious agreement to write our climate neutrality target into binding legislation, as a guide to our policies for the next 30 years,” Commission vice-president Frans Timmermans said in a statement.
Even though Mr. Timmermans was enthusiastic about the result, this is only a “provisional” decision. This leaves a sour taste.
Incomplete Sustainable Finance Taxonomy published
On other current issues, the EU Commissioners have not even reached a preliminary agreement. In the expected “Sustainable Finance Taxonomy” and presented on April 21, 2021, important points are missing – e.g. whether nuclear energy or power plants powered by natural gas can be classified as green.
Investment security and billions in EU subsidies
This is intended to create investment security for European steel manufacturers, among others. Who would not lift a finger or spend a euro without this EU decision. It is also likely that government subsidies, which are supposed to cover e.g. 95% of the CO2 investment costs for German steel manufacturers, can be better played out this way. Why else have Germany, Belgium, Luxembourg or Spain, together with Denmark and Ireland, probably otherwise put so much pressure on the EU that the paper was published incomplete?
Who will be the winner in this race?
It remains exciting in the battle for leadership in saving the climate. Even the President of the United States, Joe Biden, unlike his predecessor, seems to be taking this issue seriously and wants to jump on the green bandwagon. Online summit on climate and a desire to overtake China in EV vehicles are early signs of this.
Obvious point of contention: CBAM
But one major issue remains: the European Union’s Carbon Border Adjustment Mechanism (CBAM). China’s president has already spoken out on this to German Chancellor Merkel and French President Macron.
Climate targets must promote, not exclude
In the end, climate targets must not exclude or even shut out anyone. Developing countries in particular must be supported in achieving these goals. And not be penalized, as the EU is currently planning, for not being ready.
Even EU aluminum producers, who like European steel producers are quick to take market protection measures, have spoken out against CBAM.
China is advancing in giant steps
And if China continues as it is doing at the moment, the Chinese will overtake the Europeans. Because the Middle Kingdom cannot be accused of a lack of implementation strength. The Europeans, on the other hand, are only managing to reach a “provisional” agreement.
In the end, the earth will hopefully emerge as the green winner in this epic battle.
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