Scott Morrison – Kevin Rudd and Malcolm Turnbull said 70 per cent of our trade is with nations committed to net-zero emissions. Is that correct?
Prime Minister Scott Morrison has so far refused to bow to pressure to adopt a clear timeline for reaching net-zero greenhouse gas emissions.
The reluctance to firmly commit to a target has led to speculation that Australia could face “carbon-border taxes”, imposed on the exports of countries deemed to be climate laggards.
In an opinion article published in The Guardian, former prime ministers Kevin Rudd and Malcolm Turnbull warned that Australia “remains dangerously at risk of the economic and environmental consequences that will come from the climate crisis barrelling towards us”.
“With more than 70 per cent of Australia’s trade now with countries committed to net zero, the prospect of carbon-border taxes being introduced — beginning with the European Union — also leaves us economically exposed,” the pair wrote.
Is it correct that more than 70 per cent of Australia’s trade takes place with countries committed to cutting their emissions to zero in net terms?
RMIT ABC Fact Check investigates.
Mr Rudd and Mr Turnbull made a fair call.
At the time the article was published, 20 of Australia’s 30 biggest trading partners had already committed to reaching net-zero emissions.
Together, these 20 countries account for 71.6 per cent of Australia’s total two-way trade (all exports and imports).
Measured by exports alone, the proportion is even higher.
Of Australia’s top 30 export destinations, 17 countries have announced commitments to net-zero emissions, accounting for 74.2 per cent of the total.
On both measures, the numbers are slightly higher again once smaller trade partners — those inside the European Union but outside the top 30 — are included.
What are ‘net-zero’ emissions?
According to the United Nations’ Intergovernmental Panel on Climate Change (IPCC), net-zero emissions are achieved when human-induced emissions of greenhouse gases are matched by the removal from the atmosphere of greenhouse gases, through human intervention, over a specified period.
In assessing whether countries have committed to net zero, Fact Check has not considered the adequacy of current policies for meeting such targets.
Some climate scientists caution that net-zero pledges risk placing the focus too heavily on distant targets and unproven technological solutions, when what is needed to keep emissions in check are large, sustained cuts to emissions in the shorter term.
What makes a commitment?
A number of Australia’s trading partners have passed legislation to cut emissions to zero in net terms. This includes the UK, France, Denmark and Sweden.
New Zealand has also legislated a net-zero target, though it does not cover all greenhouse gases.
Other jurisdictions, including the European Union, Canada and Ireland, have proposed new laws, while others, including the US, China and Japan, have set the target as formal policies.
According to experts, to be regarded as being “committed” to net-zero emissions a country must clearly state its policy to cut emissions to zero by a specific date — either in legislation, in a policy document or as a formal statement to the international community.
Professor Tim Stephens, an expert in international law at the University of Sydney Law School, said a commitment to achieving net-zero emissions must be stated by a government to the international community as a clear policy goal.
“They are most credible when formally communicated to the UN Framework Convention on Climate Change as a Nationally Determined Contribution,” Professor Stephens told Fact Check.
Ideally, he said, any commitment to net zero would also be backed by credible national policies and comprehensive legislation, as with the UK’s Climate Change Act.
Professor Mark Howden, director of the ANU’s Climate Change Institute, said he considered a commitment to be “some sort of official statement by the national government that they were aiming for this emissions’ target by a specified date”.
“Normally, a commitment would also have a broad plan for achievement,” he said, adding that any target must also be calculated in accordance with the inventory guidelines of the IPCC.
This means it would apply to absolute emissions, rather than emissions per capita or emissions per unit of gross domestic product (GDP), and take into account sequestration or carbon sinks.
Should China’s commitment count?
In a September 2020 speech to the United Nations General Assembly, Chinese President Xi Jinping announced China would scale up its efforts to cut emissions with “more vigorous policies and measures”, promising to reach carbon neutrality “before 2060”.
Both Professor Stephens and Professor Howden said China should be included in the list of committed countries.
“It appears to be a clear statement by the national leadership with both an emission-reduction goal and a timeframe (and something of a plan) to achieve this,” Professor Howden wrote in an email.
Likewise, Professor Stephens said President Xi’s comments had amounted to a specific promise.
Indeed, China reiterated the promise at the recent climate summit convened by US President Joe Biden.
“We can anticipate that it will be included in China’s updated NDC [Nationally Determined Contribution] in due course,” Professor Stephens said.
However, not everyone considers China’s promise to be a commitment.
For example, the World Resources Institute pointed out that China’s net-zero target had not been enshrined in law or an official policy document, although it described the speech as “noteworthy”.
Given China made an unambiguous commitment to achieve carbon neutrality (a phrase the IPCC defines as “net-zero” emissions) before 2060, Fact Check has chosen to include China in its list of countries.
It is, however, important to note that China accounts for 28.8 per cent of Australia’s two-way trade, or 35.3 per cent of Australia’s exports.
The accuracy of the claim made by Mr Rudd and Mr Turnbull, therefore, relies on whether China’s pledge is real and should be included among the countries committed to net-zero emissions.
While the Government’s rhetoric has ramped up in recent months, it has stopped short of announcing a formal target of net-zero emissions, or putting a specific time frame on achieving such a target.
Rather, in a February 1 address to the National Press Club, Mr Morrison said Australia’s “goal” was to reach net-zero emissions “preferably by 2050”.
“But when we get there … whether in Australia or anywhere else, that will depend on the advances made in science and technology,” he said.
And in an April 19 address to business leaders in Sydney, Mr Morrison said he was “increasing in confidence” that Australia would be able to reach net-zero emissions by 2050.
He also told the Biden Administration’s April 22 climate summit the question for Australia was not “if” or “when” Australia reached net-zero emissions, but rather “how”.
“Australia is on the pathway to net zero,” Mr Morrison said. “Our goal is to get there as soon as we possibly can, through technology that enables and transforms our industries.”
Australia’s states and territories, meanwhile, have individually committed to reaching net-zero emissions, which the Climate Council says amounts to a national “de facto net-zero target”.
However, experts do not regard Australia as having committed to net-zero emissions, as the Federal Government has not said when it intends to get there, nor has it included such a target in an official policy document or legislation.
Professor Stephens said the Government had been deliberately unclear as to when Australia’s emissions might fall to zero in net terms.
Also citing the lack of a specified timeframe, Professor Howden told Fact Check that Mr Morrison’s language to date did not equate to a “commitment”.
Mr Rudd and Mr Turnbull referred to 70 per cent of “Australia’s trade”. Fact Check takes this to mean two-way trade, which combines exports and imports.
However, their article also referred to “the prospect of carbon border taxes”, an economic risk that would particularly affect exports.
Consequently, Fact Check has also assessed the former PMs’ claim on the basis of exports alone.
Using the Australian Bureau of Statistics as its source, the Department of Foreign Affairs and Trade publishes figures on both, showing the volume of trade between Australia and individual countries.
Fact Check analysed the department’s latest data for Australia’s 30 biggest trade partners, plus the European Union, covering the 2019-20 financial year.
Fact Check’s analysis found that 20 of Australia’s 30 biggest trading partners had committed to reaching net zero by 2050 or earlier, while China was committed to net- zero emissions by 2060.
Together, these countries accounted for 71.6 per cent of Australia’s total two-way trade in 2019-20.
This is consistent with Mr Rudd and Mr Turnbull’s claim.
This figure takes in some, but not all, members of the European Union, which in March 2021 resolved to design a “carbon border adjustment mechanism”.
A statement issued by EU parliamentarians explained that such a mechanism would “place a carbon price on imports of certain goods from outside the EU, if these countries are not ambitious enough about climate change”.
In total, EU countries (excluding Poland, which does not currently support a net-zero target) accounted for 8.8 per cent of Australian two-way trade. This included EU members already counted in the top 30 (7.6 per cent of trade) as well as remaining EU countries (1.2 per cent).
Including all European trading partners in the count would take the portion of Australian two-way trade covered by net-zero commitments to at least 72.8 per cent.
Trade with Taiwan, which accounts for a further 2.1 per cent of total trade, has not been included.
However, the day after Mr Rudd and Mr Turnbull made their claim, the Taiwanese government announced that it, too, would begin looking at how it could reach net zero by 2050.
Fact Check also examined Australia’s 30 biggest export destinations, along with the European Union.
Measured this way, 17 of Australia’s 30 biggest trading partners were committed to net-zero emissions, accounting for 74.2 per cent of total exports.
EU nations not included in the top 30 trading countries added a further 1.3 per cent — for a total of 75.5 per cent of Australia’s exports
Again, this is consistent with the claim made by Mr Rudd and Mr Turnbull.
As with the two-way trade figures, countries that announced net-zero targets after the date of the claim have not been included.
During the Biden-led April 22 summit, the Brazilian government said it would achieve climate neutrality by 2050, though days earlier it also said doing so would require $US10 billion ($12.7 billion) a year in foreign aid.
Principal researchers: David Campbell and Josh Gordon, Economics and Finance Editor
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