U.S. Trade War Threatens China's Environmental Efforts to Go Green

Yesterday the Dow surged over 400 points on news that China and the U.S. had agreed to hold face-to-face talks in Washington next month. However, the trade war between China and the U.S. has dragged on for over a year and, with a new round of tariffs coming into effect at the beginning of this month, there is no clear sign of the tension abating.

“At this time of global political tension can China and the U.S. recommit to a shared future?” asked the former CEO of International Finance Corporation, Cai Jinyong, during a town hall on the penultimate day of Fortune’s inaugural Global Sustainability Forum. “We are at a critical juncture. If we cannot work together I think we will setback the global sustainability drive for many years.”

One environmental consequence of the 16-month long trade war can be seen in Brazil, where swathes of the Amazon rainforest are being cleared to make way for farmland to meet Chinese demand for soy. That appetite used to be satisfied by U.S. crops. Energy supply will likely become another issue, Cai warns, saying that China’s efforts to reduce its coal consumption could be negated if the trade war limits China’s capability to develop cleaner tech.

“If trade becomes weaponized as a containment tool for China, China will have to find a way to secure its energy supplies,” Cai says.

The town hall aimed to deliver on the conference’s mission of forging a consensus on sustainability by inviting all participants to put forward what they believed was the single most important issue for world leaders to address. Throughout the discussion, the need for greater government leadership emerged time and time again.

“I think it’s about building more public-private partnerships,” said Cameron Clayton, general manager of IBM Watson Media and Weather, which uses Big Data on meteorological activity to advise stakeholders such as shipping companies, energy traders and insurance agents. “We need to share the data,” Clayton says.

Other audience members called governments to task for subsidizing unsustainable practices, such as intensive farming. Elsewhere there was the suggestion that environmental metrics—such as the reduction in national greenhouse gas emissions—should be deployed in political campaigns, in order to make the environment a voting issue.

Oddly enough, Democratic Party presidential candidates in the U.S. were challenged on their environmental credentials during a town hall in New York on Wednesday. It was the first time that the environment was made front-and-center of a presidential campaign. Evidently, while we might not have reached a consensus yet on what action to take, the pressure to do so is growing.