318: Inside COP: The New World Order - power, politics and the green pie

Joanna MacGregor: [00:19:22] Clearly, the geopolitics has shifted this year and we knew that was coming. We were aware of the headwinds. But one thing that is important to highlight is that substantial progress is still being made. We see that and we've seen it all throughout the year. Some of the biggest economies seeing clear progress. We have been traveling around and seen not just in places like China and India, but also Nigeria, Mexico, etc. big examples of countries and economies standing behind the Paris Agreement. There are stiff headwinds, but this is still a momentum story, a huge momentum story. We've seen recently in various different reports that renewables are overtaking coal. It's been a mixed picture, but overwhelmingly people are standing behind climate cooperation. And what needs to happen at Cop 30 is that it demonstrates that we've seen businesses come forward saying that climate action is good for business, and it's still the future of the economy. So although we're understanding how the geopolitics have shifted, we're excited for things coming out of Cop 30.

Tom : [00:20:24] I think what really stands out to me there about what Joanna was saying, and it's something I've both witnessed myself and heard from many other leaders, including the Brazilian presidency and others, is we can get a little depressed looking at what's happening in the US and the slowdown in Europe and elsewhere. But if you go to many other countries, you see this resurgent optimism and momentum towards action that's happening all across Asia, Latin America and Africa and many other places where you see a lot of solution and implementation taking place. So I think a big part of seeing our way to the opportunity is seeing it from other parts of the world as well.

Paul : [00:20:59] Sure. I mean, Tom, a little bit more than a little depressed. I mean, with the USA, there's all this kind of sort of anguish and smog. Certainly in my heart that means I'm not seeing these other great things. And so it's great to be reminded.

Fiona : [00:21:09] Agreed. Um, we spoke last week about, you know, it's so easy to be distracted because of what's happening in the US, which is really terrible. And in this context, it's important to pierce through that veil and focus on where there is so much happening and so much hope and so much optimism and faith and work being done to make all of this continue to manifest.

Paul : [00:21:35] Faith and work. Mhm.

Tom : [00:21:37] Let's now welcome Bernice Lee into the conversation. Just a quick way of introduction. Bernice Lee is a good friend. I've known her for many years. She's research director for futures and distinguished fellow for Sustainability at Chatham House in London. She explores how global systems can adapt in a multi-polar, climate constrained world. And I have to say, Bernice ran the climate program at the World Economic Forum in the years leading up to the Paris negotiations, and was an incredibly powerful advocate for change, a good ally and a great friend. So delighted to welcome her on to the podcast. I just want to start off with a really high level question. You have as much experience as anyone in this world of global climate diplomacy, having been around in Paris and for years before, and of course, ever since. How would you describe the state of global climate diplomacy today?

Bernice Lee: [00:22:29] I think it's very difficult to talk about the state of global climate diplomacy without thinking about what a huge trauma the world has gone through, really, in some ways the last year or so, partly because I think the world has been suffering from really a bad boss syndrome. When the boss decided that it didn't really want to be our boss anymore. It rallies everyone else, but at the same time, everyone else is now thinking, well, actually, do we still want a boss? And how do we share power in a world where we're not one of us? So in some sense, global climate diplomacy being very much part of this geopolitical reshuffling, so to speak. Obviously it's also undergoing some changes, which is really about how do you reinvent it. What we need to do is to move from really a coalition of the willing to the coalition of the doing, because we now understand that implementation is actually the foundation of the next stage. So that means that we're seeing a lot of different types of organization around sectors, around countries, different types of coalitions being built, which I think hopefully is going to be more pragmatic, less about sort of big grand bargains and more about more modular.

Tom : [00:23:33] It's interesting, isn't it, because, I mean, I hear what you're saying, and I think that's what the world needs right now. And I see both happening. I see that emerging and the kind of muscle memory of what we used to do, which is like, you know, big announcements and shared commitments and sort of there's a bit of confusion, isn't there, around what's happening at this moment, because both are sort of existing at the same time.

Bernice Lee: [00:23:52] I think that as we reconfigure what it means to do climate diplomacy in a changed world, it is not surprising that we hang on to parts of the old that hopefully still works, because some of us do look to others to figure out what we should do next. And in the world where we are not, you know, sociopaths and still care about what other people think, there is still the momentum from the old side of politics that we can draw from while we look at how to recreate and reinvent as well at the same time.

Paul : [00:24:18] You're in Beijing today, just arrived. China is clearly of the most phenomenal importance. How do you see China positioning itself now in the climate space? I mean, particularly in relation to the global South, is it bridging divides or building parallel systems of influence? Or, you know, if this is massive open goal, how is China playing it?

Bernice Lee: [00:24:37] Well, let's start by saying that I think the framing China usually brings to this discussion, which is really about development. First is a framing that many global South countries, historically at least, are comfortable with. Secondly, if we are talking about implementation and doing certainly what China has done over the past decade or so is to show up by doing. China has helped the cost reduction in renewables, batteries and electric vehicles, etc. now they are able to use their contribution to cost reduction as their contribution, as well to obviously a new development model in different parts of the world, especially the Global South, in addition to selling stuff to the Global South. I guess, so to speak, is also investing is not just about grabbing a piece of the green pie. It's also about your ability to share the green pie, because unless you can share it with different parts of the world, especially those with whom you traded, with whom you co-produce, they may well turn against. Meaning the industrial production itself. I just read a report a couple of weeks ago, I think, by Johns Hopkins talking about 220 billion or something of investment by Chinese companies in developing countries. In clean tech, this is not very official investment. This is just private companies doing so. And I think the report by Johns Hopkins compare it to effectively the sum total of I think the Marshall plan's investment. My point is China's interaction with the majority world is multifaceted, just like other countries would be. But what we see is that there is, as I said, trade investment and certainly more of a conscious effort to figure out how to share the green pie.

Fiona : [00:26:12] Thanks so much, Bernice. I mean, you've touched on a couple of things, one of which I would love to dive into a bit more around the extraction and production of minerals that underpin a lot of the renewable and resource systems that we're going to rely on for decarbonization. How are you thinking about the ways in which that has implications on geopolitics?

Bernice Lee: [00:26:33] Well, thank you for that. And you know, it's funny, when I was much younger in 2012, I did like a ginormous report with a huge team of great colleagues at Chatham House, where we explored the whole question around energy, minerals, food, land, etc.. Water. And as with most things in life, things come back into fashion. Now we're increasingly aware again of the intersections between all these resources. I mean, we talked about geopolitics earlier. We learned that nobody wants to be dependent on any one country on anything. We also understand that just as oil was a big part of geopolitics, it's not surprising that resource security will continue to be a central axis of geopolitics during the energy transition. Now, obviously, the shift to electrified transportation, grid, renewables, etc., as showing a lot of attention now to all the metals and minerals, the copper, the lithium, the nickel, the rare earths, etc. also drawing more attention around water and renewables. And obviously all of these resource interactions with energy transition and climate resilience is making us understand better about how important it is to understand the supply concentration and how countries can use extraction, processing or refining of key minerals as part of the strategic leverage. So just because we are investing in decarbonization doesn't mean that we are removing the geopolitics from the energy. We do see often that countries can try to move together despite the geopolitics, partly because obviously these resources are diffused. Currently, the production is very concentrated in the hands of a few, especially China, as we all know, and everyone is now investing in that. So these resources are creating new dynamics around supply chains, around value chain politics. And there will be a contestation over how to obviously get the bigger part of the pie. But again, we're seeing industrial policies evolving already along these lines and new kinds of regional blocks, all of which could harden both geopolitical competition but also have an effect on the speed and scale of decarbonisation as well. Looking forward.

Tom : [00:28:49] Yeah, the comments you make there about needing to share the green pie and geopolitics is still there, but it gets reorganized as the energy transition accelerates. I mean, these are huge trends that are going to really shape the geopolitical landscape of our world going forward. But just to bring it back to this year, only a few weeks now till we'll all be in Belgium. There's a lot of reports going on, what to expect, how the ambition might shake out, how the overall alliance between state actors and non-state actors might be reframed. But as you look at this, both with an eye on the long term as well as on the short term, what do you think we should be looking out for as key indicators or trends or other indicators of what's really happening, that maybe we don't have our eye on so much of the time?

Bernice Lee: [00:29:32] Well, the challenge around working on climate related issues is that it feels like most of the important things are under-reported. I just was reading about the Antarctic. I was reading about the tipping points of systemic risk aspects, all of which I think are underreported. And that also means that it will change the political calculus around, obviously, adaptation finance, but also the urgency of all of it. So obviously, you know, I think what to watch out for is whether we make progress on adaptation, both in terms of money, but in terms of the way we discuss it, in terms of urgency. We often focus on the sort of top number about finance, but less about the how part. Perhaps we should be focusing more as well here on what is underneath the top line, whether or not they're really going to work or not. This cop is a different kind of cop in the sense that it's not really a negotiation cop. It's going to be an implementation cop. Then a lot of the emphasis should be put on the extent to which all of the promises are turned into specific instruments, and the extent to which these instruments are going to be useful and embedded within national and other systems as well.

Bernice Lee: [00:30:37] I worry about the bifurcation of the global economy, making it harder for the scaling and the diffusion of technologies. I certainly would like to see more discussions around interoperability of future technology systems. If indeed we have to produce stuff separately, then we need to make sure that whatever technologies come forward in the future, at least it's interoperable if not coming from the same family necessarily. Interoperability for green industrial policy and technology standards for me would be an important part of the future. So I hope that in the medium term, this is what we'll be looking at. We will probably start to hear more from businesses and understanding that the business case is not just about themselves making business work, it's also about their own ability to work with governments to shape the enabling condition. Because what we've seen over the past decade as well is that those who have given policies a good push also see the blossoming of their industries GS, as well as many different types of competitive advantages as well.

Tom : [00:31:50] So Bernice Lee, I mean, she's always so sharp, I think, on these things. I mean, having spent her career in Chatham House and just really looking at the underlying, yes, climate issues, but how they intersect with all the broader geopolitics is so good, isn't it? Do you want to come in with any reflections and thoughts?

Fiona : [00:32:04] I mean, my notebook is like full of things that she said that I just think summarizes.

Tom : [00:32:09] You know, you know, we were recording it. You didn't have to make notes as we were going. Yes, yes, yes.

Fiona : [00:32:15] Not all of us have such good memories. Okay. Well, I mean, the bad boss syndrome. And then the way in which that contributes to this feedback loop of a lot of other countries asking if that actually looks better for them as well. I think was so interesting. But there was one thing that I really wanted to underscore. We talked a lot, and we will be talking a lot about how this is the implementation Cop, and we dove in quite a bit. Last episode to what does that mean? What do you look for? And I think one of the things she said, this is where promises get turned into specific instruments to impact change. And I just thought that summarized much more clearly the linkage between the more traditional negotiation focused cops versus what we're seeing in and anticipating in Brazil around implementation.

Paul : [00:33:06] She referenced the Marshall Plan specifically in the scale of what China is doing. Of course, the whole idea behind the Marshall Plan was sharing the pie, and now it would seem that win win economics is about sharing the green pie. But I think the whole point about that is that's how you build alliances, how you build trade, how you build trust and how you scale something. So there's real wisdom to that approach. It's not a kind of zero sum, which is what so much of the sort of awful populism of the last decade has been about. You know, my country wins, your country loses. It's like, honestly, it makes me want to puke.

Tom : [00:33:38] I really liked the phrase sharing the green pie, Py. But I also hope that this transition to the green world and to the regenerative world will be less about defining pies and fighting over who gets slices, and more thinking about more of an abundant world with more abundant sources of energy, where it's less about that way of seeing the world, though.

Fiona : [00:33:57] Interestingly, Tom, didn't you just say at the top of the episode that we're entering an era of competition and not cooperation?

Tom : [00:34:05] Yeah, that's a good point, but not competition for scarce resources. That's the difference, right? Is that yes, the minerals thing and the materials thing is a different issue here. But as we've said many times on this podcast, once you got your solar panels, the sun doesn't send you a bill, the wind doesn't send you a bill. Is there a way in which we can pivot what has always been zero sum thinking? If I want this and need to take it from you and all the other ways in which we've structured geopolitics for such a long time now, it may be naive thinking to think we can break out of that, even in some small way, but that's got to be the big hope of a changed energy system, hasn't it? Is that we're not defining a size of pie and fighting over slices, we're instead thinking about how do we unleash an era of much greater abundance that we can then actually meet needs in a different way? Paul's got a sort of wry smile on his face.

Paul : [00:34:52] I'm just looking forward to a competition for not scarce resources. I think I could do well in such a competition. I feel really positive about it. Let's go ahead and have that.

Tom : [00:34:59] Just a room full of candy.

Paul : [00:35:01] Fill your pockets. Hey.

Tom : [00:35:04] Yes. Good point. But I think what Bernice is so smart at thinking about also how countries like, fit in together and how we're moving now from an era in which countries, of course, have been competing to create this new world, to this multipolar relationship with all these other different non-state actors, but also how messy that transition is and how much support we're going to need with the right instruments and the right partnerships to ensure we can actually pivot to this new era of implementation.

Fiona : [00:35:33] Can I just ask, what is the green pie?

Paul : [00:35:35] Well, the green pie is best described, I think, by you, Tom. Wasn't it? Because obviously I understand what it is. But let's just see if Tom's.

Tom : [00:35:41] I think the idea of the green pie is a metaphor to relate to green growth. So the ability to generate growth from clean energy and industries of the future. So if you said, you know, if someone wants a slice of the economic pie, then it means that they want to generate more growth. You know, you want to like build more factories. You want to take advantage and capture the benefits of economic transformation and growth, and get a bigger slice of that pie for your country, right? It's simply a subset of that question just related to green technology and industries, I guess.

Fiona : [00:36:12] I wonder when we won't have to specify that it's green. So many climate people talk about needing to talk about climate differently. This right here is a way where instead of talking about a green pie, we talk about the new industrial pie or something that just not coded in a way that puts off blaring alarms for people who don't even know what the green pie is.

Tom : [00:36:36] And I think that probably brings us to a close. Anything either of you would like to say before we wrap up this week's episode on geopolitics?

Paul : [00:36:42] Just that, um, it's so exciting going into this cop knowing all these different things that can happen. It's all too big to sort of grasp or summarize, but I think there will be narratives that come out. It was fun to talk to Bernice about them, and I think we can look forward to naming this new age, which I think is just still emerging. Feels like Dawn. What about you?

Fiona : [00:37:01] Yeah, so many brilliant interventions by women this episode. I think one of the things that has really stuck with me is, as the world does shift, how is there a commitment and maintenance to innovation and abundance, and what is each of our role in helping manifest that?

Tom : [00:37:21] I think that's a great place to end. So lovely to see you both. Shame we didn't have Cristiano this week, but nice. She made a cameo appearance and will be back as ever next week. Thank you very much for listening. We'll see you next week for another episode of Inside Cop.

Fiona : [00:37:34] Bye bye.