Financing climate justice in the European Union and China: common mechanisms, different perspectives

Abstract

Climate justice is a concept with many different and competing interpretations. It has salience at intra-country, inter-country and intergenerational levels of climate politics. While inter-country climate justice has long been on the agenda of United Nations climate negotiations, the intra-country and intergenerational aspects of climate justice have assumed new prominence in many countries in recent years, as the economic consequences of mitigation became felt and transnational activism highlighted youth concerns. The diverse elements of and approaches to climate justice have this in common: realising them requires massive financial interventions and reforms. This article examines the still emerging frameworks to finance climate justice in two of the jurisdictions most important to the global response to climate change: the European Union and the People's Republic of China. The EU and China have in common that they are both on the front line of financial innovation to respond to climate change. They are utilising similar tools of systemic financial intervention in order to transition financing to climate-friendly investment, in the first case domestically, but with clear implications for global financial markets. However, the EU and China are utilising climate financing mechanisms in the context of very different prevailing perspectives on climate justice. This article interrogates the relationship between these different perspectives on climate justice and the distribution, scale and pace of climate finance. The article also observes that while the EU incorporated climate justice considerations in its economic responses to the COVID-19 pandemic with a recovery package prioritising climate action, China did not take the opportunity to foster a 'green recovery'.