Reflections on the Chinese Communist Party's 20th National Congress

The need to tackle climate change globally has sharpened focus on delivering low-carbon energy transition globally. However, concurrent geopolitical risks can undermine this transition. China’s saber-rattling on Taiwan at the 20th Communist Party Congress, held just weeks ahead of COP27 is a good case in point.To get more news about 20th CPC national congress, you can visit shine news official website.

Xi’s combative rhetoric on Taiwan prompted global speculation about the country’s shifting timeline for reunification with the self-ruling island and what the global response to that would look like. This rhetoric is neither surprising nor unprecedented. However, reunification is likely becoming a more pressing issue for the Party. As it moves towards fulfilling the second centenary goal of building China into a modern socialist country by 2049, it will want to ensure full control over what it considers an integral part of the country’s territory. In the context of the ongoing Russia-Ukraine war and increasingly fraught bilateral relations with the US, China’s rhetoric therefore escalates geopolitical risks to global low-carbon energy transition and climate change governance.

Russia’s invasion of Ukraine earlier this year shook global energy markets, highlighting the geopolitical risks linked to fossil fuel supply chains but also the risks of geopolitical shocks to energy transition. In response, some European countries, for example, turned to coal, if only temporarily, but also signalled their willingness to finance new gas infrastructure in Africa in sharp contrast to previous calls to end support for such projects.

The risks of conflict over Taiwan between China and the US to global energy transition will likely far exceed the impacts of the Russia-Ukraine war. Reducing fossil fuel dependencies, however, will not necessarily increase energy independence and reduce exposure to geopolitical risks. In the current geopolitical context, dependencies throughout renewable energy supply chains, expose countries to geopolitical risks which are difficult to minimise in the short to medium term.

What would these risks look like? Much depends on how the conflict, if one were to take place, would unfold – mutual financial and trade sanctions and severance of diplomatic relations, direct military confrontation, or a combination of the two, as well as which other countries get drawn into it. However, even if limited to sanctions and severe deterioration of diplomatic relations, it would create significant risks. Three are particularly pertinent.

First, bilateral talks between the two countries, and with them technological cooperation would become even more challenging if not impossible. While climate change is a universal issue, isolating it from broader geopolitical issues, particularly in the context of conflict, appears implausible. With the US playing a critical role in European security during Russia’s ongoing war with Ukraine, it would also expect the EU to support its response on Taiwan. As well as undermining the overall global message and cooperation on climate change and energy transition, halting technological cooperation may hinder research and development and timely scaling up of technologies that could be critical to low-carbon transition.

Second, any conflict between China and the US risks disruptions to low-carbon supply chains. China is critical supplier of solar panels and other components but also in mining and processing of critical transition minerals and rare earths. Both the US and the EU are now scrambling to diversify and reduce their dependencies on China across these supply chains. However, doing so may be difficult in the short to medium term. In case of conflict and trade restrictions with China, countries would scramble to replace the country in their supply chains risking disrupted transitions.

Third, financing for low-carbon infrastructure globally from China and the US would likely drop below the already modest levels. Ahead of the National Congress, China published a concept note for Global Energy Partnerships focused on catalysing global energy transition but a surge in financing for overseas renewables projects is yet to happen. At the same time, US climate financing falls short the levels it committed to. And while long-term systemic rivalry can bring financing opportunities for developing countries as China and the US compete for global influence, economic and political disruptions as a result of potential conflict over Taiwan, would further strain financing for transition.

As above examples illustrate, geopolitical risks will continue to loom large over the global energy transition and climate change governance. A conflict over Taiwan would disrupt the efforts to tackle a global threat that is climate change, but it is unclear that either China or the US would put it above its other interests.