Over the past decade, consistent high-level diplomacy and joint agreements between the U.S. and China have underpinned international climate efforts – testament to the fact that when and if great powers can set aside ideological differences and identify common ground, as China’s special Climate Envoy Xie Zhenhua and his U.S. counterpart, former Secretary of State John Kerry have, positive changes will materialise. The two powers’ cooperation, drawing upon private sector efforts and synergy through academic exchanges, has paved the way for landmark initiatives such as the 2015 Paris Agreement and the 2021 Glasgow Declaration, which extended collaboration in methane emissions.
Yet, in the run-up to and aftermath of COP28, it is vital that decision-makers must shift beyond major economies and emitters to consider the interests and incorporate the voices of Global South, especially as developing nations are increasingly embroiled in issues from climate financing deadlocks and energy security to increasing economic fragmentation and worsening climate impacts. Resource and political will bottlenecks across regions such as Southeast Asia, Africa, and Latin America demand attention and investment from both Beijing and Washington.
Southeast Asia, a region notably vulnerable to climate crises, has been grappling with natural disasters, infrastructural, and agricultural issues, amplified by a projected intensification of the 2023 El Niño phase into 2024. With a temperature spike by 4.8°C and a 70 cm sea level rise forecasted by century’s end, many of the indigenous and coastal communities residing in the region would face heightened risks from environmental extremes.
Across all ten ASEAN economies, the deleterious impacts of climate change are by no means abstract: they are profoundly realistic destabilising forces that could induce disruptions across societal and economic aspects.
It is in Beijing and Washington’s interest to recognise the urgency of bringing the voices of their counterparts in Southeast Asia into the fold of bilateral cooperation. Doing so would in fact help ameliorate some of the worst episodes and elements of politicisation – over greenhouse gas emissions, clean energy supply chains, and green tech – that have cropped up in U.S.-China relations over the past couple of years. Indeed, Southeast Asia is significant across a number of dimensions, including the energy transition landscape and its potential for climate technological advancement.
First, Southeast Asia is pivotal in the rapidly accelerating energy transition, with the (ten) regional economies’ swift economic growth, rising energy demand, and rich renewable energy potential – from high solar irradiation levels to coastal wind energy potential, as well as the presence of hydropower capabilities. Mitigation and decarbonisation have climbed in relative salience and importance in the region. In the supply chain context, Indonesia is pivotal, especially as a provider of nickel – a crucial mineral for energy transition. With 49% of global production facilities, it will maintain its status as the top nickel miner, ensuring its critical role in the energy transition over the next decade.
Second, with its staggering growth potential, the tech startup sector in Southeast Asia – expected to reach over $1 trillion valuation by 2025 – has been buoyed by and benefited from expanding digital population and robust trade balances. The region, which already attracts significant venture capital, promises substantial growth for climate tech, given the commitment of 9 out of 10 ASEAN members to achieve net-zero emissions by 2050. This is not to mention the cheap overhead costs of tech research and development, while positioning as a politically-neutral zone for market entry, innovation, and tech inclusion. Cities such as Singapore, Jakarta, and Ho Chi Minh City are emerging as tech hubs across the fields of renewables and data-based energy streamlining, underpinned by supportive ecosystems featuring coworking spaces and accelerators.
Third, to counter devastating climate impacts and promote sustainable growth, Southeast Asia must prioritise developing climate-resilient infrastructure, which, beyond bolstering connectivity, economic expansion, and job generation, plays a critical role in fortifying nations against climate threats and strengthening adaptive capabilities for marginalised communities. A $210 billion annual investment is identified by the Asian Development Bank as critical for the region to enhance infrastructure, growth, and climate resilience while addressing developmental challenges, such as poverty. This vision has and can manifest in initiatives such as renewable energy projects, green buildings, waste-to-energy facilities, and sustainable transportation systems, with spillover benefits to be accrued to actors outside this immediate region.
It is clear that the U.S. and China alike would benefit from empowering and working with Southeast Asian counterparts in further deepening and accelerating the renewable transition in the region. The potential upsides for planet Earth are sizeable and palpable. Southeast Asia, with its diverse, large, and growing population, affluent natural resources, and robust economic outlook, is at a crucial juncture in its development. The region has the capacity to harness its climate leadership, amplifying its economic and geopolitical prowess, leveraging upon climate investments and expertise.
The U.S. leading in green tech and capital access, boasts some of the world's preeminent clean energy companies and research institutions, as well as a dynamic startup ecosystem innovating in areas like energy storage and EV. Its deep and liquid capital market can readily finance sustainable infrastructure projects through foreign direct investment. ASEAN is already the number one destination for U.S. investment in the Indo-Pacific – more than the U.S. has invested in China, India, Japan, and South Korea combined.
China, adept at swiftly and efficiently building green infrastructure projects, has been vital in promulgating and driving forward extensive economic and infrastructure collaboration, as evidenced by Trina Solar’s solar farms in Vietnam and Risen Energy’s solar power plants in Cambodia. More low-carbon infrastructure projects can leverage demonstrated success, capacity, and the low cost of renewable energy provisions. China’s EV capabilities can also help reduce the reliance on fossil-fuel vehicles – an important challenge faced by many cities across ASEAN that struggle with congestion and air pollution.
Now the trillion-dollar question becomes – why should China and the U.S. work together? The answer is rather straightforward. As affirmed recently at the historic meeting between Presidents Biden and Xi – the last before America heads into the 2024 electoral season – collaboration is pivotal to the joint interests of China and America. None of the above forms of collaboration could be truly sustained over time without a modicum of alignment and tacit agreement over the modes and means of engagement. That is to say, duplication of resources and initiatives, competition-induced fragmentation and inconsistencies in policymaking, and the amplification and exacerbation of domestic political turmoil caused by prospective Sino-American rivalry and divergence over climate policies, could not possibly be in the interest of regional actors, or, indeed, those who are seeking to advance productive efforts to combat climate change.
The U.S. and China should collaboratively provide the necessary resources to finance Southeast Asia’s path to energy transition success. With knowledge and financing established, transitioning from coal to renewable energy thus becomes feasible and climate tech booms. The complementary advantages in Sino-U.S. climate leadership, diplomacy, and resources can foster a climate-resilient society, deliver sustainable, inclusive growth, and promote peace and stability – but the prerequisite is that these two elephants do not view Southeast Asia, and its climate change policies, as just another battleground. In maintaining an open and conducive environment for Southeast Asian partners, Beijing and Washington are also doing themselves – and the planet – a favour.
