Lessons from the G7 on Why We Need A New Era of Climate Diplomacy

As the leaders of the world’s most developed economies met in France for the G7 summit, iconic youth leader, Greta Thunberg, sailed across the ocean to attend a youth climate summit for the global movement she started only a year ago. And while Donald Trump left an empty leaders chair at the G7’s climate meeting, thousands of miles away in either direction, the Amazon rain forest burned and one of the world’s fastest-growing and most populous developing countries announced it would relocate its sinking capital city.
While Larry Kudlow, economic adviser to President Trump, castigated the G7 for focusing on “politically correct bromides” rather than a future of growth and prosperity, the UN secretary general called on the G7 leaders to adopt even stronger measures to deal with climate change—commensurate with a 1.5 degree Celsius temperature rise target. French president Macron, seeking to avoid the counterproductive outcomes of the last several G7 meetings, chose not to issue a joint statement on climate change due to lack of agreement. Instead, the group pledged $20 million to fight the fires in the Amazon, a move that now looks to be rejected by the president of Brazil as an act of colonialism. What a mess.
The G7 has historically played an important role in climate change diplomacy, which is important because climate change is a global challenge requiring global solutions. This year marked 40 years since the leaders first agreed on the need to develop alternative energy and halt carbon emissions at the G7 summit in Tokyo in 1979. As the impacts of climate change become more pronounced, and our failure to address both the causes and consequences becomes more evident, so do our diplomatic and multilateral shortcomings. 
In 2019, the hottest year on record, the economic toll of global environmental disasters continues to grow, with the United States already experiencing six disasters costing in excess of a billion dollars—equal to the annual average since 1980. In most cases, it’s safe to assume that those who lost homes, businesses, or infrastructure, were only partially compensated for their loss and much of the infrastructure that was rebuilt was probably not done in a way to make it more resilient to future disasters—if it was rebuilt at all. This means that on a country-by-country basis, the impacts of a changing climate are getting harder to manage, just as our systems of global governance are being challenged on all sides.
The great irony of this moment is that neither economics nor technology stands in the way of making progress on this issue—it’s our politics. On the one hand, right-wing nationalist leaders see the solutions to climate change as a threat to economic growth and impacts of climate change (particularly migration) as a threat to sovereignty and national identity. On the other hand, for left-wing populist movements, climate change is an existential threat. They see the solutions to climate change as a way to unseat dominant corporate interest, which could also serve as a platform to remedy persistent and structural inequality and advance social justice. At the highest levels of government, this political moment is making it harder to move forward on this issue just as the impacts are becoming more evident and the pathways to deploy technological solutions become clearer. The dialogue is moving further away from the realities of progress being made within countries and across industries, and as such, it is unable to catalyze further action.
A dose of honesty and humility in these discussions could help unlock new areas of collaboration that cross the political divides. First, President Trump and Mr. Kudlow would do well to remember that GDP growth following a massive tax cut is not an economic revelation nor does it de facto equal a healthy society on the pathway to long-term prosperity. The broader global economic discourse post-economic crisis has been about creating more sustainable and inclusive economic growth over longer time horizons and turning away from short-term market performance measures. Climate change is not a niche issue anymore; it is a clear threat to those long-term growth prospects.
In 2017, the United States alone saw $306.2 billion in damages from natural disasters—a record, but still just a fraction of the $1.7 trillion in cumulative damages since 1980 as these events become more common. Looking forward, research suggests climate change could reduce global economic output by anywhere from 7 to more than 20 percent by 2100. One study estimates that 3.7 degrees of warming could lead to as much as $551 trillion in damages by the end of the century. The Trump administration would do well to participate in conversations about more sustainable and inclusive growth—not only for future global climate but also for U.S. economic   competitiveness over the long run. Investing in climate-resilient infrastructure would be a good start, yet the White House’s repeated attempts at an “infrastructure week” have become something of a running joke in Washington D.C.
Second, it is hard for the world to move to a more aggressive 1.5 degree Celsius target when leaders have not delivered on their promises thus far. There are very real and substantive reasons for wanting to adopt those targets. The difference between just 1.5 degree Celsius and 2 degree Celsius of warming has been estimated at 153 million more premature deaths from air pollution by the end of the century—40 percent of which would occur by 2060. But the credibility of the global community suffers when past pledges go unmet and new, more ambitious ones are put in their place. The most glaring failed promise is, of course, the 2015 Paris Agreement, where only two countries have made commitments commensurate with its goals (Morocco and the Gambia) and several countries’ emissions are growing faster than before pledges were made.
On the G7 pledges, the plan to completely end subsidies by 2025 looks highly unlikely, as countries bicker over definitions and cling to inefficient public spending. The International Monetary Fund estimates that when environmental damages are taken into account, G7 countries spend over $1 trillion annually on post-tax subsidies to fossil fuels, or roughly 3 percent of their collective GDP. The United States alone spends $649 billion, and less than a third of the environmental damages are due to climate change—most still come from localized air pollution from coal-fired power plants. While the jury is still out on just how effective eliminating fossil fuel subsidies would be for emissions reductions, some studies have put the direct impact as low as a 5 percent reduction in emissions by 2100. Serious action on subsidies would send a powerful signal to investors that can’t be captured in these models. Perhaps more importantly, G7 countries need to show progress on their most high-profile goal if they are to sustain their position of leadership and agenda-setting.
Finally, Macron’s decision to side-step issuing communiques on issues that are confrontational made sense in the context of this meeting, but this is not an adequate long-term strategy, particularly if Trump wins another term. Macron’s instincts to lead on this issue have been apparent for much of his administration; but rather than focusing on many things at once, he would be smart to prioritize two specific areas where the global architecture is set to shift: security and trade. The elephant in the room is that the United States is renegotiating its role as an economic and security force in the world. Regardless of the Trump administration’s tactics, priorities, or execution, this is likely to be true of future administrations as well.
On the national security front, where the impacts will be great, and the ability of the global community to respond can be easily overwhelmed, this conversation needs to be prioritized at the highest levels of government. Quite simply, more natural disasters and fewer natural resources is a potent mix for weakening governance, civil conflicts, and refugee crises. A June 2019 study, published in Nature, notes that “intensifying climate change is estimated to increase future risks of conflict,” with the risks increasing more than five times current levels if the Earth reaches four degrees of warming. Existing conflicts, such as those in Darfur and Syria, have already been linked to the changing climate and the scramble for dwindling resources—especially water. Even renewed tensions between Pakistan and India in Kashmir are being linked to climate change and its impact on water security.
As natural disasters increase in number, conflicts increase in likelihood and resources become more scarce, the number of climate refugees will grow. The UN International Organization for Migration estimates there could be as many as 200 million climate refugees in total by 2050, and their high-end estimate is 1 billion—nearly 20 million disaster-displaced refugees in 2017 alone. Not only does this lead to genuine humanitarian crises internally, but growing refugee numbers have contributed to significant political instability across the European Union and the United States. The current crisis at the U.S.-Mexico border has also been linked to climate change as droughts, floods, landslides, and hurricanes have threatened the livelihoods of subsistence farmers in the Central American region. Serious questions about how we will prepare for these issues must be addressed.
The global trade architecture is also shifting and is likely to be the next venue for a new round of carrot and stick-related conversations about climate change. So far, international forums like the G7 have been rocked by a chaotic U.S.-China trade war, and the World Trade Organization’s credibility is threatened by the Trump administration’s short-sighted decision to block all appointments to its Appellate Court. As such, these institutions are unprepared for the growing number of countries setting a carbon price and border-adjustment fees, as well as growing subsidies worldwide for clean or green technologies that put trade protectionism and climate action at odds with one another. Macron’s announcement that France may block an EU trade deal with Brazil if they do not deal with runaway fires in the Amazon is an inkling of where climate change could take the trade agenda in the future.
What’s more, growing social movements calling to leave fossil fuels in the ground or phase out specific fuel sources, like coal, are also likely prompt a series of international disputes over the future of fossil fuel resources. More direct and potentially disruptive options, such as governments directly purchasing high-carbon content reserves, international agreements for the progressive closure of coal mines, or implementing export-licensing regimes on fossil fuels, akin to the safeguards on uranium, may well also become the topics of future G7/G20 meetings. While some of these ideas have merit, others would threaten energy security and economic development.
Climate change is a complex issue requiring a global response. Our political moment has changed, and so too should our approach to climate diplomacy. This will require heightened ambition coupled with genuine action. It also necessitates reframing familiar issues, such as trade and security, through the lens of climate change. Finally, instead of bypassing difficult issues, forums like the G7 should be venues for finding new areas of compromise. Moreover, this new era needs to start now. Global prosperity and security might just depend on it.
Sarah Ladislaw is senior vice president and director and senior fellow of the Energy and National Security Program at the Center for Strategic and International Studies (CSIS) in Washington, D.C. Lachlan Carey is an intern with the CSIS Energy and National Security Program.
Commentary is produced by the Center for Strategic and International Studies (CSIS), a private, tax-exempt institution focusing on international public policy issues. Its research is nonpartisan and nonproprietary. CSIS does not take specific policy positions. Accordingly, all views, positions, and conclusions expressed in this publication should be understood to be solely those of the author(s). 

© 2019 by the Center for Strategic and International Studies. All rights reserved.
Sarah Ladislaw

Sarah Ladislaw

Former Senior Associate (Non-resident), Energy Security and Climate Change Program

Lachlan Carey