rethink sustainability
COP28 set for first ever global stocktake, as world leaders assess Paris progress
In November 2014, China’s President Xi and then US President Barack Obama made what was to become a historic joint statement. In advance of the COP21 UN Climate Change Conference they affirmed their determination to work together to cut global greenhouse gas emissions (GHGs) in order to keep global warming to below 2 degrees Celsius. Their joint resolution was seen as crucial to the adoption of the 2015 Paris Agreement.
As we approach December’s COP28 in the United Arab Emirates, history may be repeating itself. Despite trade and geopolitical tensions between the two superpowers, President Xi’s recent visit to the US resulted in a joint declaration on climate change (the ‘Sunnylands Statement’) that, among a wide-ranging list of pledges and plans for climate collaboration, promises to “triple renewable energy capacity globally by 2030”. Crucially, the agreement also rekindles a commitment to cut methane emissions, which have so far been absent from Chinese greenhouse gas reductions targets.
Dr Sultan Ahmed Al Jaber, Minister of Industry for the UAE and COP28 President-Designate, welcomed the statement, saying that the declaration would “have a meaningful impact for generations to come.” Will the US-China climate rapprochement lay the foundation for major new agreements at COP28? We take a look at what lies ahead at the UAE’s first COP.
The energy transition – cutting emissions by 2030
With 2023 set to be the warmest year on record1, efforts to cut carbon emissions will be high on the agenda. Recent research shows that while emissions growth is no longer accelerating, emissions are still at an all-time high and continuing to increase year-on-year, putting the Paris Agreement temperature targets in jeopardy.2
The US-China Sunnylands Statement tackles this head-on. In addition to the commitment to tripling global renewable energy capacity, the two governments pledge to substitute coal, oil and gas for renewable energy, so as to achieve an absolute reduction in overall power sector emissions in “this critical decade of the 2020s”. At COP28, green hydrogen and carbon capture and storage technologies are likely to feature in discussions, as governments aim not merely to slow carbon emissions growth, but to put emissions firmly on a downward trajectory before 2030.
Read also: Betting everything on net zero – interview with Thomas Hohne-Sparborth
The Sunnylands Statement also gives hope that COP28 will start the process of creating binding targets for reducing other GHG emissions beyond carbon. Methane, which is shorter-acting but can be more than 80 times more potent than carbon dioxide3, has, to date, been missing from many national emissions reduction plans.
The Global Methane Pledge, which was launched at COP26 in 2021, aims to plug this gap, with signatory nations agreeing to cut methane emissions by at least 30% by 2030. However, the Pledge is missing some of methane’s biggest emitters, most notably China, which emits more methane than any other country4. Following the Sunnylands Statement this could be set to change, with China promising to develop reduction targets and agreeing to jointly host a dedicated Methane and Non-CO2 Greenhouse Gases Summit at COP28.
Trade day
COP28 will also include the first ever “Trade Day”, in recognition of the role that our economy plays as a contributor to climate change, and to explore how trade can be harnessed to reduce emissions.
According to the United Nations, the production and distribution of goods and services are responsible for 25% of all greenhouse gas emissions.5 However, the UN Conference on Trade and Development estimates that trade in goods designed specifically to use fewer resources or cause less pollution rose to a record USD 1.9 trillion in the second half of 2022.
One key element of this growth is non-plastic packaging, the value of which increased by 20% over the same period. With the Environment Committee of the European Parliament calling for COP28 to adopt measures to fight plastic pollution6, and the US-China Sunnylands Statement committing to the development of an international treaty to put an end to plastic pollution7, Trade Day could see renewed efforts to address the problem of plastic waste.
Read also: Eradicating plastic waste
A focus on nature
Nature and biodiversity are also likely to feature prominently, as the international community increasingly recognises that there is no net zero without the natural world’s unique ability to absorb and store carbon.
According to the science journal Nature, forest preservation and restoration could provide much of the mitigation needed to limit global warming to within the Paris temperature target by 2030.8 Despite this potential, the UN says, “45% of commitments made on nature between 2019 and 2022 show little or no signs of implementation.”9 Here again, the Sunnylands Statement could provide momentum, with the US and China making a robust reaffirmation of their commitment to halting and reversing forest loss by 2030.10
Alongside numerous high-level events, including a Leader’s Event entitled ‘Protecting Nature for Climate, Lives and Livelihoods’, Lombard Odier, in partnership with holistiQ Investment Partners11, will host the re-NATURE Hub, a two-day gathering of global leaders in finance, academia and government. Across global food, energy, materials, and land & oceans systems, delegates will explore the opportunity for nature to form the basis of a new economic model that is both regenerative and socially-just.
Read also: Hope from the ashes: unearthing ancient value in our forests
The first ever global stocktake – marking halfway
This focus on social justice will also be central to the first ever “global stocktake”, as delegates assess progress at the halfway point between the 2015 Paris Agreement and the 2030 deadline for the UN’s Sustainable Development Goals (SDGs).
Adopted in 2015, the SDGs outline 17 objectives targeting environmental, social and economic health, including action to combat climate change and to create secure livelihoods through sustainable economic growth. Climate financing is seen as crucial to achieving the SDGs, and yet global funding is still falling short. With an entire day of the summit dedicated to putting people and livelihoods at the heart of climate action, there will be renewed calls for developed nations to deliver on a pledge to provide at least USD 100 billion each year for climate mitigation and adaptation in developing nations.
According to a recently released UN report, the world is also falling short on measures to reduce GHG emissions. On our current trajectory we now face warming of 2.9 degrees Celsius, far in excess of the Paris Agreement’s target of 1.5-2 degrees Celsius. To achieve the Paris target, the report says, GHGs would have to fall by 42% below their current predicted 2030 level.12 When it comes to tackling climate change and achieving the Sustainable Development Goals, according to UN Secretary-General Antonio Guterres, the world is “woefully off-track”.
However, as world leaders take stock of progress, there will be some cause for optimism. Emissions growth is now slowing, and 2030 GHG emissions levels are projected to be considerably lower than was feared at the time of the Paris Agreement.13 And, crucially, business heads and policymakers will be buoyed by the Sunnylands Statement, as the world’s largest emitters head to COP28 with a joint resolve “to keep a 1.5 degrees Celsius temperature rise within reach.”
1 Global heat: Extreme autumn sets up 2023 to break records - BBC News
2 ESSD - Indicators of Global Climate Change 2022: annual update of large-scale indicators of the state of the climate system and human influence (copernicus.org); Global greenhouse gas emissions at all-time high, study finds | Climate crisis | The Guardian
3 Facts about Methane | UNEP - UN Environment Programme
4 Overview – Global Methane Tracker 2022 – Analysis - IEA
5 Trade's role in climate action in the spotlight at COP28 | UNCTAD
6 COP28: MEPs want all countries to strengthen their climate commitments | News | European Parliament (europa.eu)
7 Sunnylands Statement on Enhancing Cooperation to Address the Climate Crisis - United States Department of State
8 The economic costs of planting, preserving, and managing the world’s forests to mitigate climate change | Nature Communications
9 Delivering on Glasgow: Halting and Reversing Forest Loss by 2030 (cop28.com)
10 Sunnylands Statement on Enhancing Cooperation to Address the Climate Crisis - United States Department of State
11 holistiQ is a trading name of the Lombard Odier Investment Managers group (“LOIM”) and is not a legal partnership or other separate legal entity
12 Emissions Gap Report 2023 | UNEP - UN Environment Programme
13 Idem
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