The BRI has had considerable influence on China, on BRI host countries and the world. It would be wrong to see it as a declining force simply because Beijing is allocating less finance to BRI projects: many of the BRI’s initial goals were achieved early on in its first decade. The BRI has evolved over time to suit Beijing’s strategic goals. This special edition of the tracker examines the BRI’s impact on trade flows through the ports sector – critical logistics nodes along the BRI. We look at the ports built, bought, operated and used by China’s state-owned national champions. 

First, Clark Banach maps out China’s footprint across global port ecosystems in a detailed map. Banach, who is MERICS Futures Fellow, explains the more deeply Chinese SOE’s are entrenched in a port, the more strongly it is pulled into China’s orbit at the expense of trade with other partners. 

Second, MERICS Lead Analyst Jacob Gunter builds on Banach’s quantitative analysis with a qualitative look at how China’s involvement in ports develops. Gunter details China’s presence in Mediterranean and Northern European shipping ecosystems and how ports can spread distortions emanating from China’s own economic model. He examines how port networks create potential dependency and influence risks. 

Banach and Gunter then take a closer look at four Mediterranean ports with Chinese participation. In each case study, they assess Chinese SOEs’ strategic and commercial success or failure. The case studies look at port holdings or operations in Greece, Spain, Algeria, and Israel and offer a way to benchmark Beijing’s desired outcomes and how far they are being achieved. 

Finally, they suggest what the future of the BRI might look like, drawing on President Xi Jinping’s speech to Third BRI Forum and their own research. The future BRI can be expected to leverage its extensive built infrastructure further, while shifting focus towards green energy and telecoms equipment. China’s green transition industries suffer from overcapacity, so they need export outlets, while telecoms giants like Huawei and ZTE must secure and expand their footprints in more neutral markets to compensate for restrictions on their activities in liberal democratic markets. 

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The economic crisis arising from COVID-19 has led G20 economies to unleash huge volumes of fiscal support. This support has tended to prioritise protection of existing economic structures. As support measures transition into fiscal stimulus, G20 governments must consider the structural impact that measures will have on long-term economic growth. The necessity for fiscal stimulus in the recovery provides a unique opportunity for a sustainable infrastructure strategy aimed at transforming G20 economies into economies fit for the challenges and changes of the twenty-first century.

To read the full report from Bruegel, please click here. 

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Steelmaking uses coal both as a source of heat and as part of the chemical process of converting iron ore to elemental iron. Both of these uses produce carbon dioxide. Eliminating CO₂ emissions from steelmaking requires a change in process. Using hydrogen as the heat source and the chemical reducing agent can eliminate CO₂ emissions, or carbon capture can remove them. Steel can also be recycled without CO₂ emissions, but demand for steel is too large to be met with recycled steel alone.

Cement production also releases CO₂ as part of the chemical process, in this case when limestone is heated to very high temperature to produce calcium oxide “clinker,” the cement’s primary component. Other substances can be mixed with clinker while still maintaining cement quality, but the primary method of decarbonizing the sector is to capture the CO₂ and store or find a use for it.

The chemical industry is different from the other two, encompassing many thousands of processes and products. However, more than 90% of “organic,” or carbon-containing, chemicals are derived from just a few building blocks, which are produced in large quantities and traded internationally. The chemical industry is also unique in that it uses coal, oil, and natural gas as feedstocks that are transformed into final products, not just sources of energy. Fossil fuels will likely still be feedstocks in a zero-carbon world, with process electrification and zero-carbon hydrogen as methods of removing CO₂ emissions. Ammonia is crucial for fertilizer and although it does not contain carbon, hydrogen needed for its production is today made from natural gas, with carbon dioxide as a by-product.

To read the full report from the Brookings Institute, please click here.

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First, the report lays out the broad economic case for protecting nature, including an examination of the many known economic and social values of biodiversity, while recognizing that the complexities and interdependencies of nature mean that attempted economic valuations will almost certainly be partial and underestimates. Biodiversity loss presents serious known and unknown risks to human prosperity. The report further examines the underlying market failures that hasten global biodiversity loss and indicates a number of policy interventions and changes needed to halt biodiversity loss.

Second, the report focuses on a critical element related to protecting biodiversity, namely the biodiversity financing gap between the current total annual capital flows toward global biodiversity conservation and the total amount of funds needed to sustainably manage biodiversity and maintain ecosystems integrity. Having gauged this biodiversity financing gap, the report identifies a set of nine financial and policy mechanisms that, if implemented and scaled up, can collectively close this gap.

The report goes into detail about the enabling conditions for the implementation and scaling of each of these mechanisms, and it makes detailed recommendations for policy makers, business leaders, and other stakeholders. It makes clear that all governments—from the biodiversity rich nations that may have limited economic means to the established donor countries—must take immediate actions to stem the loss of biodiversity.

The immediate intent of this report is to inform the work of national delegations and other negotiators in developing the resource mobilization strategy for the Post-2020 Biodiversity Framework that will be agreed to at the 15th Conference of the Parties (COP15) of the UN Convention on Biological Diversity (CBD) in 2021. The longer-term intent is to help political leaders, country finance ministries, international institutions, and representatives of companies, NGOs, and private philanthropy to better understand the economic case for biodiversity conservation and to accelerate the transformation of national economic models to those that appropriately value nature.

Given the magnitude of the biodiversity financing gap identified by this report, coupled with estimates of the relatively limited amount of funding that will be available in coming years from traditional sources such as governmental budgets, official development assistance (ODA), and philanthropy, it is critical that the biodiversity targets to be agreed to at COP15 incorporate a broad spectrum of nontraditional mechanisms. Catalyzing private sector capital must be a priority, given that it constitutes the largest available source of financing. However, the report makes clear that the potential for private capital to support biodiversity conservation will only be realized if appropriate governmental policies, regulations, and incentives are in place.

To download the full report, please click here

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The United States has made substantial progress towards a low-carbon economy over the past several years. Low-carbon technologies have become more efficient and affordable, and U.S. clean energy investment and deployment grew to new heights, creating millions of jobs. Whether this continues will depend on how the government responds to the COVID-19 crisis.

In addition, addressing climate change can allow the United States to secure a share in the booming domestic and global cleantech market by manufacturing and exporting low-carbon technologies. Moreover, it will help revitalize rural communities by diversifying rural economies and providing affordable clean energy.

Inequalities highlighted by the COVID-19 crisis make it clear that the United States must ensure that moving forward climate policies are fair and equitable by supporting fossil fuel workers and communities and ensuring the benefits of climate policies are shared by all.

To view the original report, please click here

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To view the full report, click here.

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