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Econographics November 11, 2022

The target of limiting global warming to less than 1.5 degrees is practically dead. Why do emissions per capita matter?

By Amin Mohseni-Cheraghlou

As the world keeps warming and the frequency of natural disasters rises (figure 1), government officials and private and public sector leaders are convening in Egypt’s Sharm el-Sheikh resort for the 27th Conference of the Parties to the United Nations Framework Convention on Climate Change. More commonly known as COP27, participants will discuss the climate challenges facing global communities and economies. Rising global temperatures, extreme weather events, and droughts are front and center at COP27, especially during times when close to a billion people are facing hunger and food insecurity around the world.

However, achieving the target to limit global warming to below 2, preferably 1.5 degrees Celsius, compared to pre-industrial levels by the end of the century seems more unfeasible than ever. The reason is simple. This target, adopted by 196 parties at COP21 in Paris, on December 12, 2015, necessitates global greenhouse gas emissions to decline as soon as possible. Nevertheless, as seen in figure 2, global CO2 emissions—the most critical of greenhouse gases—have continuously risen in the past decade (excepting 2020 as a result of the pandemic shutdowns and lower global economic activity).

CO2 emissions are only expected to grow more in 2022 and for the foreseeable future. That increase is mainly due to coal’s strong comeback after Russia’s invasion of Ukraine. The subsequent financial and energy warfare between Russia and the Group of Seven (G7) has led to global shortages in crude and natural gas, forcing many economies to make a shift back to coal. Coal, used mainly in electricity generation and the industrial sector, emits twice as much CO2 than burning natural gas, setting the world even further back from its 1.5 degrees Celsius target by 2100. According to the United Nations Environmental Program, global temperatures have already increased by 1.1 degree Celsius in comparison to pre-industrial levels. Levels will rise by more than 3 degrees Celsius by 2100 if business continues as usual and global emissions aren’t reduced drastically. The world’s largest emitters must take meaningful steps to reduce greenhouse gas emissions. Little to nothing should be expected from those economies —such as Small Island Developing States—that have contributed minimally to global greenhouse gas emissions but bear the brunt of global warming’s impacts

As seen in figure 3, responsible for more than 31 percent of the world’s CO2 emissions, China is the largest CO2 emitter in the world, followed by the United States and India at 14 percent and 7.2 percent, respectively.

Clearly, reducing emissions of the world’s largest CO2 emitters can lead to substantial gains in reducing global warming. However, to achieve the most effective and efficient global outcomes, it is important to put these numbers in perspective. While China is by far the largest CO2 emitter in the world, in per capita terms, twenty-seven countries in the world had higher CO2 emission than China did in 2019. As seen in figure 4, twenty-one of these countries—representing about 30 percent of global CO2 emissions—were high-income economies and four were from the G7: Canada, the United States, Japan, and Germany. Specifically, Canada—with 15.4 metric tons per capita—and the United States—with 14.7 metric tons per capita—had about twice the per capita CO2 emission than China’s 7.6 metric tons per capita. This is while China is responsible for 28.7 percent of the world’s manufacturing—which is much more energy-intensive than services and agriculture, as compared to 16.8 percent in the United States, 7.5 percent in Japan, and 5.3 percent in Germany (figure 5). As part of its manufacturing, China produces 70 percent and  40 percent of the world’s solar panels and wind turbines, respectively. In other words, even though China is the world’s largest factory producer for the global market—including the global renewable energy industry—twenty-seven other economies attending COP27 have higher CO2 emissions per capita than China.

This does not mean that China, as the world’s largest CO2 emitter, has a less important role in reducing global greenhouse gas emissions. Not at all. However, it certainly means that a majority of high-income advanced economies—especially the United States—must play a more significant and active role on this front. This is for three main reasons. First, as seen in figure 6, CO2 emissions per capita in high-income economies are on average more than 1.5 times, 5.5 times, and 33 times that of upper-middle-income, lower-middle-income, and low-income economies, respectively. Second, from budgetary and technical perspectives, high-income economies have more resources to reduce greenhouse gas emissions without significantly impacting the well-being of their economies. Most other economies, especially those in the lower-middle-income and low-income categories, simply don’t have the economic capacity to reduce their emissions. Third, a significant share of CO2 emissions in high-income economies is “luxury emissions” versus those in poorer economies which are mainly “subsistence emissions” in nature. The share of global emissions of the world’s richest 1 percent (mainly residing in high-income economies) is expected to reach 16 percent of the world’s total by 2030 (from 13 percent in 1990 to 15 percent in 2015). Furthermore, the world’s richest 10 percent are responsible for a third of global emissions. Achieving global climate justice means reversing the rise of inequality in the world’s emissions. If increasing emissions from poor economies is not an option, which certainly is not, the only remaining path to achieve climate justice is to reduce emissions of the world’s richer population.

To conclude, high-income economies account for more than 35 percent of global CO2 emissions while they host only 12 percent of the world’s population. Their CO2 emissions negatively impact the lives of the world’s most vulnerable and the poor, the vast majority of whom reside in lower-middle-income and low-income economies. The 1.5 degrees Celsius target is practically dead, and the Paris Agreement has become non-binding. The good news is that CO2 emission per capita in most high-income economies have declined over the past decade —for example by 16% in the case of the United States and Germany—but as seen earlier in figure 4 they remain to be at elevated levels and more needs to be done faster. Coal’s strong comeback is creating a strong headwind for this trend and could reverse it in some of these economies. COP27 needs to pave the path for a renewed international cooperative and enforceable framework to reduce global greenhouse gas emissions by the world’s top emitters both in absolute terms and in per capita terms. Unfortunately, the current geoeconomic and geopolitical rivalry and confrontation between the world’s largest economies does not help in this regard, but we have no choice but to remain hopeful.

Amin Mohseni-Cheraghlou  is a macroeconomist with the GeoEconomics Center and leads the Atlantic Council’s Bretton Woods 2.0 Project. He is also an assistant professor of economics at American University in Washington DC. @AMohseniC

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