China, the United States and Europe are in this field

In response to the increasingly severe global climate challenge, high-level government officials and scholars from China, the United States and the European Union, as well as representatives from the International Monetary Fund, OECD and other international institutions, recently attended an online meeting aimed at jointly promoting the formation of a global carbon pricing mechanism.

Representatives of all countries generally agree that the global carbon pricing mechanism will become an important “weapon” for all countries to deal with climate change.

Three parties promote the establishment of carbon pricing mechanism

Release positive signals

The online conference, jointly organized by the International Financial Forum (IFF), the European Working Group on carbon pricing and the Paulson foundation, aims to promote the discussion on global adoption of carbon pricing at the 26th United Nations Climate Change Conference (cop26) to be held in Glasgow, UK, in November this year.

The conference mainly focused on two topics: the efficiency of carbon pricing mechanism in the process of dealing with climate change and how to deal with carbon leakage. Representatives of various countries believe that the United States, China and the European Union are the three major economies in the world, and they are also the most important carbon dioxide emitters. If the three parties can form a consistent carbon pricing mechanism, it will greatly improve the efficiency of forming a global carbon pricing mechanism.

Edmund alfondilly, former French finance minister and chairman of the European Working Group on carbon pricing, said, “if the world’s three major economies and three major emitters can develop a carbon pricing mechanism, it will send a positive signal of overturning to promote global energy substitution.”

Earlier, alfonsdaley released in his keynote speech at the International Financial Forum (IFF) spring 2021 meeting in Beijing at the end of May this year the news that it would promote the tripartite discussion on carbon pricing mechanism.

In order to promote global “accelerating sustainable and inclusive growth”, G20 foreign ministers and development ministers just concluded their first meeting since 2019 in the ancient Italian city of Mateira last week.

The online meeting on carbon pricing was held immediately after the meeting, highlighting that countries attach great importance to and practice the international consensus of multilateral cooperation mechanism to deal with climate change.

Carbon pricing helps to achieve the goal of temperature control

At present, many countries have started the post epidemic economic recovery stimulus plan, international cooperation is particularly important.

According to the relevant research of the United Nations, the traditional economic stimulus plan will rapidly increase the level of carbon dioxide emissions, making it impossible for the world to achieve the goal of “Paris Agreement” to control the global average temperature rise within 2 degrees Celsius compared with the pre industrial period, and strive to limit the temperature rise within 1.5 degrees Celsius.

According to Laurent Fabius, President of the 21st UN climate change conference and former Prime Minister of France, the latest UN research shows that there is a 40% possibility that the global average temperature will increase by 1.5 degrees Celsius in 2026, and the Paris Agreement hopes to postpone the time to the end of this century through efforts of all parties. Fabius said he believed carbon pricing was the key to achieving that goal.

At the online meeting, representatives from the IMF and OECD presented a joint research report. The report, entitled “tax policy and climate change”, points out at the beginning that according to the current commitments and relevant policies of various countries, the world will not be able to achieve the temperature control goals set by the 2015 Paris Agreement.

According to the report, carbon pricing is the “indispensable and most cost-effective” weapon to help the world reach the temperature control goal of the Paris Agreement. The report describes in detail the role that carbon pricing can play, pointing out that carbon pricing can effectively promote enterprises and end consumers to reduce greenhouse gas emissions and use green energy, and will also promote the private sector to increase investment in clean technology. Carbon pricing also has the flexibility and long-term effect beyond other incentives, which can effectively improve government revenue.

Among the three major economies in the world, the EU is currently in the leading position in emissions trading. As early as 2005, the EU started to establish a carbon dioxide emissions trading mechanism. At present, the EU carbon dioxide trading system has been gradually improved, and the price has reached the level of 50 euro / ton.