On September 25th 2015, a bilateral meeting between US President Barack Obama and Chinese President Xi Jinping was held in Washington D.C. to make a joint statement on the regulation of public investment in overseas coal export projects.
The U.S.-China Joint Presidential Statement
According to the U.S.-China Joint Presidential Statement, the two Presidents agreed to transition to a global low-carbon society through public investments. In this statement, China promised to “work towards strictly controlling public investment flowing into projects with high pollution and carbon emissions both domestically and internationally, and to strengthen low-carbon policies and regulations.”
It is not clear how China will be “strictly controlling” public investment but China’s commitment to reconsider public investments for overseas high-carbon project, such as coal-fired power generation, is a very significant and political first step.
Regulations on public investments in coal-fired power generation
Negotiations by members of the OECD’s Working Party on Export Credits concerning overseas public investment in coal-fired power generation projects continue to unfold. The US, UK, France, Germany and other countries have agreed to tighten regulations. Meanwhile, Japan, South Korea, and Australia were against the introduction of these new regulations. The Japanese government argues against the impact of the regulations with the excuse that “even if the OECD ends financial support for coal projects, China will take over”.
However, China’s political commitment was a game changer, paving the way for other OECD countries to take on new regulations. There are some worries, however, from other OECD countries that Japan will remain an isolated adversary. They hope that Japan will step forward with them towards this new path.
References:
The White House, Office of the Press Secretary
For Immediate Release: U.S.-China Joint Presidential Statement on Climate Change (September 25, 2015)
Reuters,
China ‘highly polluting project’ decision to spur coal subsidy talks（September 30, 2015）