The Paris Agreement's central aim is to strengthen the global response to the threat of climate change by keeping the global temperature rise during this century well below 2°C above preindustrial levels and to pursue efforts to further limit the temperature increase to less than 1.5°C above the preindustrial levels. China has already signed the Paris Agreement, and its action plays a vital role in determining the outcome of the Agreement. As the largest developing country, it accounted for 26% of total global greenhouse gas (GHG) emissions in 2016. China's emissions grew very rapidly during the reform period of the past 40 years. If China does not comply with the Agreement, then it is hard for the world to achieve the goals it has set for itself. But it is by no means an easy task for China. Although the aggregate size of GHG emissions already dominate the global picture, China's per capita emissions are still significantly below the levels of many developed and developing countries. It would be difficult to convince the Chinese public that China should cut emissions aggressively, especially if this comes with a significant economic cost. As some Chinese commentators put it: since all the advanced countries had their GHG emissions during their early stages of economic development, why should China now be stripped of the right to develop its economy? So the question is if deep cuts to GHG emissions would be harmful for the Chinese economy. In their paper (Jiang et al., 2021), Jiang and his research team provide an excellent analytical foundation for thinking about the issues of GHG emission cuts, not only for the public, but also for policymakers. By building a quantitative model, Jiang et al. are able to derive numerical results on the likely impact on the macroeconomy, industrial structure, and the composition of energy. The most important finding, in my view, is that achievement of the “2°C” goal could actually result in China's gross domestic product (GDP) in 2050 being 1.5% higher, and consumption being 1.7% higher, compared with the baseline scenario. Indeed, this is very encouraging. Of course, the efforts trying to achieve the “2°C” goal could force a lot of structural changes in the Chinese economy. But these structural changes could make the overall economy more efficient, while bringing about new investment at the same time. The common perception that deep cuts to GHG emissions will mean a loss for China is simply wrong. By significantly reducing GHG emissions, China not only contributes to the global environment, but also improves its own economy. With this empirical judgment, Jiang and his colleagues should be more effective in convincing their bosses at the National Development and Reform Commission (NDRC) and the State Council to set a more ambitious target of peaking of CO2 emissions earlier – it is not only doable, but also beneficial. In fact, the Chinese economy is already in the middle of important structural changes in favor of GHG emission reduction. The share of the manufacturing sector in the overall economy peaked in 2012 and the weight of the service sector is rising quickly. Such changes and other efforts trying to improve efficiency could make the “2°C” goal or even the “1.5°C” goal more attainable. However, these results do not imply that implementation of deep cuts to GHG emissions will be painless. As Jiang et al. (2021) demonstrate, important adjustments will have to take place in order to achieve the policy goal, including changing the composition of energy supply, raising the share of electrification and upgrading technology in the transportation sector. Some industrial sectors, such as the steel, cement and chemical industries, could experience major changes. Therefore, success or failure of the “deep cut” policy depends not only on the government's determination, but also, more importantly, on policy skills to smooth the transition process. This calls for policy measures to help workers, factories, and regions that are affected by the transition process. This will be a key test for the Chinese government, including Jiang and his colleagues at the NDRC.
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