Climate Capitalism in Europe and China

In China and the EU, the “market economy” takes different values in different fields and sub-fields. Whereas we talk about the power industry caped under an ETS, the financial sector mobilized to inject “carbon finance” in the “green economy”, the emerging “renewable energy industry” and other “climate service” industries, they navigate between different regulatory jurisdictions from local to transnational, through national and regional. In China, the fragmentation and of economic governance since the beginning of the reform and opening up has been well-documented. Local experimentation has been a key to economic growth. Yet, at the same time the local entrepreneurial and predatory state has also been a strong impediment to the implementation of environmental laws. In the EU also, the implementation of climate policies, including carbon trading and the promotion of renewables, has run into important difficulties and political upheavals, many of which can be related to the fragmentation of the governance of EU Energy market. Furthermore, tensions between cooperation and competition are also intimately intertwined in EU-China relations on climate change. Expectations of increasing convergence and “win-win” opportunities due to the adoption of ambitious climate policy goals on each side are often deceived by trade disputes, confrontations in the UNFCCC and – although often hidden behind diplomatic declarations – frustrations with the practical outcomes of bilateral cooperation project. Can the marketization of climate policies in China and the EU, especially the development of carbon trading deliver on its promise to achieve fast and cost efficient transition to a “low carbon economy” and, if so, does it imply smoother and fairer global climate governance?

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