Divergences between the European Union and China on reducing international aviation emissions

Abstract

This paper provides a historical overview regarding the emergence, development and deepening of divergences between the European Union (EU) and the People’s Republic of China (China) in reducing global aviation emissions. It focuses on their divergences on three specific issues, i.e. under which framework to tackle global aviation emissions, whether and how to reflect the Common but Differentiated Responsibilities and Respective Capabilities (CBDR-RC) principle in the design and implementation of the global market-based measures (MBMs) for international aviation and which role the International Civil Aviation Organization (ICAO) should play in offsetting these emissions. Besides, this paper explains the driving forces behind these divergences by examining both normative and economic-related factors, which have formed different stances of both sides. From a Chinese perspective, considerations about the issues of state sovereignty, fairness regarding burden sharing in tackling climate change, the development of China’s aviation and aircraft manufacturing and its limited capability in promoting the large-scale SAF deployment help explain its hardline stance on reducing global aviation emissions. As for the EU, perceptions of its leading role in the global climate governance and the CBDR-RC principle, the targets of strengthening the EU ETS role in the global carbon market, and the competitiveness of the European airlines are underlying reasons behind its attempt to include the international aviation under its ETS. Moreover, the EU member states’ support to the ICAO can be explained through the conformity between the emissions offsetting objectives under this organisation and the EU’s current climate policies.

Introduction

As one significant contributor to the issue of climate change, by 2050, international aviation emissions are estimated to be around threefold higher than those of 2005 (ICAO n.d.-b). Thus, it is imperative to strengthen the global effort in reducing these emissions, which currently has been mainly undertaken through two existing market-based measures (MBMs), namely the EU Emission Trading System (EU ETS) and the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA). As a key tool for the EU to achieve its climate targets, the EU ETS follows the cap-and-trade principle and issues free allowances for the aviation sector. By comparison, the CORSIA is the only existing global MBM for controlling international aviation emissions, which aims at offsetting their CO₂ growth by purchasing eligible emission units, instead of issuing free allocation for airlines (Duong 2021).

Given that the European Union (EU) and the People’s Republic of China (China) are amongst the world’s biggest greenhouse gases (GHGs) emitters, which are concurrently the large economies and key players in the international climate negotiations, their active engagement in tackling global aviation emissions has become indispensable. It is, however, worth noticing that the EU and China hold divergent views on many fundamental issues regarding reducing aviation emissions through these two MBMs, reflected in their aviation dispute about the inclusion of the international flights within the EU ETS, as well as the design and implementation of the CORSIA under the framework of the International Civil Aviation Organization (ICAO). In order to bridge their divergences and improve the effectiveness of addressing global aviation emissions, it is a prerequisite to examine thoroughly which specific issues the EU and China diverge on and what the main driving forces are behind their stances. Yet, the existing literature either focuses on the EU legitimacy in including international flights under its ETS and the EU-China aviation dispute regarding this unilateral policy (CCIEE 2012; Cheng 2011; de Domingos 2012; Lan 2011; Liang and Zhang 2014; Mendes de Leon 2012; Xu 2012) or merely examines China’s position towards the CORSIA (Fan and Liao 2020; Huang 2017; Liu 2019). There is surprisingly little systematic comparative study about the stances of both sides on reducing global aviation emissions which provides a comprehensive account of driving forces behind their divergences.

This paper purposes to fill this research gap by focusing on two main questions: Firstly, what are the main divergences between the EU and China on reducing international aviation emissions? And secondly, why do they hold these divergences? By providing a historical overview of stances between the EU and China on reducing international aviation emissions, it aims to examine the main divergences between both sides regarding the three following issues: firstly, under which framework to tackle global emissions from the aviation sector; secondly, whether and how to reflect the Common but Differentiated Responsibilities and Respective Capabilities (CBDR-RC) principle in the design and implementation of the global MBMs for international aviation, and thirdly, which role the ICAO should play in offsetting these emissions. Subsequently, this paper will provide exhaustive explanations of driving forces behind the EU-China divergences by exploring international and normative-related and economic-related factors, which shape distinctive stances of both sides towards offsetting aviation emissions.

The evolution of divergences between the EU and China on reducing international aviation emissions

The emergence of divergences: 2007–2010

In this period, the establishment of the global MBMs to address international aviation emissions had become an important topic of discussions under the ICAO. The 36th and 37th Sessions of the ICAO Assembly were respectively convened in 2007 and 2010. At the 37th Session, the ICAO Assembly for the first time adopted a resolution on climate change and required the council to build a framework for the global MBMs (ICAO 2010). Achieving the carbon neutral growth from 2020 (CNG2020) was determined as an aspirational and collective target to address international aviation emissions. Moreover, following the Conference on Aviation and Alternative Fuels in November 2009 (CAAF/09) and the establishment of an ICAO Global Framework for Aviation Alternative Fuels (GFAAF), Resolution to A37-17/2 (afterwards renamed A37-19) underlines the need of using sustainable alternative aviation fuels to reduce international emissions (ICAO 2010).

During this period, divergent views between the EU and China on reducing international aviation emissions had emerged. At the 36th Session of ICAO Assembly, the European states filed a formal Reservation to Appendix L, Resolution A36-22, which urged countries not to unilaterally implement their ETSs on international aircraft operators without mutual agreements. On November 2008, the EU adopted Directive 2008/101/EC to include the aviation sector in its ETS. Accordingly, from the beginning of 2012, international flights had been regulated under this scheme. At the 37th Session of ICAO Assembly, the European states continued to file a formal Reservation to Resolution A37-19, insisting on the legitimacy of its ETS application to international flights. Furthermore, they criticized that the CNG2020 target is insufficiently stringent to address international aviation emissions. In contrast, in its Reservation to Resolution A37-19, China questioned the fairness and feasibility of the CNG2020 target, as well as underscored the historical responsibility and leading role of developed states in tackling climate change. Besides this, it reiterated that the implementation of any MBM on other states’ aircraft operators can only be legal based on mutual consensus.

Divergences in development: 2011–2015

This period can be considered as preparation time for the launch of the CORSIA at the ICAO’s 39th Assembly, which was based on the results of discussions at the ICAO’s 38th Assembly regarding the creation of a global MBM to offset aviation emissions, the establishment of the Environment Advisory Group (EAG) in March 2014 and the launch of the first round of global aviation dialogues (GLADs) on May 2015.

While divergences between the EU and China during the first period were embedded in international discussions without direct and fierce conflicts, this period had seen the development of their divergences at both bilateral and multilateral levels. In the aviation dispute regarding the inclusion of international flights under the EU ETS, China was amongst the most vocal opponents against the EU policy. At a bilateral level, on behalf of Chinese airlines, the China Air Transport Association (CATA) in March 2011 issued a statement to express its vehement disagreement with the EU and urge the Chinese government to adopt countermeasures against its unilateral policy (CATA 2011). In June 2011, first orders of European Airbus aircrafts were cancelled by the Chinese side, followed by the delay of ten other orders in March 2012, which would be worth roughly 14 billion dollars (Hepher 2012). In response to the enforcement of Directive 2008/101/EC, the Chinese government on 6 February 2012 banned all domestic airlines from complying with the EU ETS (Xinhua 2012). At a multilateral level, China joined the international meeting in New Delhi on 29 and 30 September 2011 to discuss countermeasures against the EU unilateral policy. This country also participated in a group of EU Directive opponents, which on 22 February 2012 issued the Joint Declaration of the Moscow Meeting on Inclusion of International Civil Aviation in the EU ETS, urging the EU to stop implementing its new ETS policy. Indeed, the EU Directive’s legitimacy and conformity with international laws had been widely questioned (Lan 2011; Liang and Zhang 2014; Mendes de Leon 2012).

Nevertheless, during the time of the international meeting in New Delhi, in the ICAO Council Briefing entitled ‘Aviation and Emissions Trading’, the EU reaffirmed the legitimacy of its ETS (Runge-Metzger 2011). In May 2012, it issued a warning to eight Chinese airlines for not submitting information about their carbon emissions by the deadline. The total fines were estimated to be approximately US$3 million (Kanter 2013). Yet, to avoid international oppositions and facilitate the negotiations of a global MBM for controlling aviation emissions within the ICAO, the EU in November 2012 decided to temporarily exclude non-EU airlines from its ETS (European Commission 2012). In 2014, the second suspension was decided by the EU for aviation emissions occurring from 2013 to 2016 (Erbach 2018).

Within the ICAO’s framework, the EU and China did not only hold their different views on the EU unilateral policy, but their existing divergences regarding the CNG2020 goal and the CBDR-RC principle had also become more intense. These divergences have been indicated throughout formal Reservations of the EU member states and China with regard to Resolution A38-18.

Deepening divergences: 2016–2021

The third period begins with the organization of a High-level Meeting on a global MBM scheme in May 2016 (ICAO n.d.-a, 2016b), followed by an establishment of the CORSIA, a global MBM for controlling international aviation emissions at the 39th Session of the ICAO Assembly in October 2016. To facilitate the implementation of the CORSIA, the EU decided in February 2017 to extend its ETS scope limitation to only EU airlines until the end of 2023 (European Parliament and European Council 2017). During this period, the ICAO Council and its member states had indeed fulfilled some preparation works for the implementation of the CORSIA from 2021. For instance, in October 2017, the Second ICAO Conference on Aviation and Alternative Fuels (CAAF/2) was organized, followed by the adoption of its declaration and the 2050 ICAO Vision in March 2018. In June 2018, the Associated Standards and Recommended Practices (SARPs), which are regarded as the Monitoring, Reporting and Verification (MRV) rulebook of the CORSIA, were approved by the ICAO Council. Subsequently, the Emissions Units Criteria (EUC) were adopted in March 2019, followed by the issue of the eligible emissions units 1 year after that. According to the assessments of the Technical Advisory Body (TAB), six eligible emissions units are in line with offsetting requirements of the CORSIA’s first phase, including China Certified Emissions Reductions (CCERs) under the China GHG Voluntary Emission Reduction Program (ICAO 2020c). In June 2020, the ICAO Council decided to revise the CORSIA’s baseline due to severe impacts of the Coronavirus disease of 2019 (COVID-19) on airline industries (ICAO 2020a). In July 2020, the EU released its Inception Impact Assessment to assess different policy options regarding its ETS revision for aviation, followed by its decision to continue the applications of its ETS to EU airlines and the CORSIA to non-EU ones (European Commission 2020a, 2021). Since the beginning of CORSIA pilot phase from 1 January 2021, this scheme has been officially implemented by participating states.

During this period, divergences between the EU and China on reducing international aviation emissions had become deeper in a wide range of aspects. In both the 39th and 40th Sessions of ICAO Assembly, China filed its Reservation to ICAO’s Resolutions regarding climate change, the global MBMs scheme and the CORSIA. Besides voicing its concerns about the adoption of the CNG2020 goal as the CORSIA’s baseline, China questioned the fairness and feasibility of the 2050 ICAO Vision regarding the promotion of sustainable alternative fuels (SAFs). Furthermore, it opposes the definition of CORSIA eligible fuels and the implementation of the SARPs (Xinhua 2019). At the ICAO’s 40th Assembly, China and Russia issued a joint statement about the CORSIA, criticizing that its one-size-fits-all standards lack equity and procedural justice (Carbon Pulse 2019; ICAO 2019d). During the eight meeting on 4 October 2019, China requested a vote on the drafts of two ICAO’s Resolutions related to climate change and the CORSIA. According to ICAO (2020b), China is not on the list of 88 countries, which by July 2020 announced to join the CORSIA from the pilot phase.

In a quite different vein, all EU member states decided to join the CORSIA from its initial phase. Although these states showed their high expectation in establishing an ambitious global scheme to curb aviation emissions, they did make concessions regarding the mandatory implementation of the scheme, which will start only from 2027, instead of 2021 as they prefer (Valero 2016). During the ICAO’s 40th Assembly meetings, the EU member states indicated their support to the drafts of two ICAO’s Resolutions related to climate change and the CORSIA. They also insisted on the fairness and feasibility of the SARPs and ICAO Vision 2050 (ICAO 2019c).

Main divergences between the EU and China on reducing international aviation emissions

Divergences on the legitimate framework to address international aviation emissions

In relation to the EU unilateral policy of including international flights under its ETS, China maintains that Directive 2008/101/EC infringes upon the CBDR-RC principle within the United Nations Framework Convention on Climate Change (UNFCCC), as well as the regulations of the Kyoto Protocol and the ICAO in tackling climate change (CATA 2011; Liang and Zhang 2014). For instance, according to Article 3 of the Kyoto Protocol, whereas developed countries need to reduce its emissions ‘by at least 5 per cent below 1990 levels in the commitment period 2008 to 2012’ (United Nations 1998:3–5), developing ones are not subject to any binding commitment. Furthermore, Article 2.2 of this Protocol expressly states that incorporating parties will work through the ICAO to address aviation emissions (United Nations 1998). China holds that unilateralism does not only thwart the global effort in addressing climate change, but it is also harmful to aviation industries in developing countries (CATA 2011). Thus, as mentioned in its Reservation to Resolution A39-3, China is of the view that any MBM can only be implemented based on mutual consensus amongst countries.

By comparison, the EU insists that Directive 2008/101/EC is fully in line with the international principles and agreements. From its perspective, the CBDR-RC is the guiding principle for climate actions amongst states which should not be applied to business activities. Since the EU ETS is implemented in its market and for aviation industries, it does not infringe this principle (Runge-Metzger 2011). Besides, the EU argues that the Convention on International Civil Aviation (hereafter referred to as the Chicago Convention) does not include any provision which requires a contracting party to obtain consent from others as a precondition to implement its MBMs. Furthermore, it underscores that Resolution A35-5 of the ICAO’s 35th Assembly is in favor of open emissions trading and enables contracting states to include international flights under their ETSs. Therefore, the EU objects to Appendix L, Resolution A36-22 of the ICAO’s 36th Assembly as it contradicts the ICAO’s approach and legal foundation of the Chicago Convention. While being strongly committed to addressing aviation emissions under the ICAO and the UNFCCC, the EU maintains its perceived right to incorporate international flights into its ETS, which would effectively contribute to the global effort in mitigating climate change. These arguments have been underlined in Directive 2008/101/EC, as well as Reservations of the EU member states to ICAO’s Resolutions A36-22, A37-19 and A38-18. Besides, notwithstanding the implementation of the CORSIA, the EU indicates its intention to maintain intra-EEA flights within its ETS and strongly opposes the CORSIA exclusivity clause mentioned in Paragraph 18 of Resolution A40-19 (Erbach 2018; European Parliament 2018; Greenair Communications 2019).

Divergences on whether and how to reflect the CBDR-RC principle in the design and implementation of the MBMs for international aviation

Mentioned in Article 3(1) of the UNFCCC, the CBDR-RC is a guiding principle which acknowledges different responsibilities and capabilities between developed and developing nations in tackling climate change (United Nations 1992). The EU and China do not diverge on the technical term and meaning of this principle itself; rather, they differ in their views regarding whether and how to reflect it in the design and implementation of the MBMs for international aviation.

Within the ICAO, China’s standpoint is consistent that the CBDR-RC principle should be reflected in the design and implementation of the MBMs for aviation, i.e. in the review of de-minimis threshold, the application of de-minimis exemption to merely developing countries in consideration of their national circumstances and capabilities in achieving the CNG2020 target (ICAO 2013b, 2013c, 2013d, 2016e). In fact, relentless efforts of China and other developing countries in proposing and negotiating amendments for the drafts of ICAO’s Resolutions had led to the listing of the CBDR-RC as a guiding principle for MBMs in Annex of Resolution A38-18. As stated in ICAO (2016e, 2016f) and China’s Reservation to Resolutions A39-2 and A39-3, the country is of the view that due to their significant historical emissions and strong coping capabilities, developed countries need to take the lead in offsetting aviation emissions. Thus, China called for a clarity of burden sharing between developing and developed countries in the implementation of the CNG2020 goal. As mentioned in its Reservations to Resolutions A37-19 and A38-18, China holds that the former should not be subject to any commitment in achieving the CNG2020 goal whereas the latter should undertake effective measures to reach more ambitious targets.

In contrast to China, during the initial discussions of establishing the MBMs for controlling global aviation emissions under the ICAO, the EU member states were strongly against the recognition of the CBDR-RC as one of the guiding principles for the MBMs. In their formal Reservation regarding Resolution A38-18 in 2013, the EU member states argue that:

The UNFCCC principle applies to actions by States. In taking regional action, it would result in market distortions and discrimination among operators if there were to be differing treatment between operators on the basis of their nationality for activities to and from airports in Europe. As such, this would be in contradiction with the principles enshrined in the Chicago Convention and which govern ICAO's work. (Written statement of Reservation by Lithuania on behalf of the member states of the European Union and 14 other member states of the European Civil Aviation Conference (ECAC) with regard to ICAO Assembly Resolution A38-18 2013:3)

Thus, while confirming its support to the aviation sector of developing countries, the EU puts more emphasis on avoiding carbon leakage and market distortion (ICAO 2015). As mentioned in the EU member states’ Reservations to Resolutions A37-19 and A38-18, the EU disagrees on the tax exemption of operators below the de minimis threshold, which from its perspective may lead to the large tax immunity to flights from above 160 countries and undermine the effectiveness of the whole scheme.

Divergences on the role that the ICAO should play in offsetting international aviation emissions

Regarding the issue of offsetting international aviation emissions, China maintains that the role of the ICAO is merely ‘important advisory’, and this organisation ‘should strengthen its cooperation with other organizations and enhance synergies rather than pursuing the so-called leadership’ (Statement of the Chinese Delegation on the consolidated statement of continuing ICAO policies and practices related to environmental protection — climate change and the consolidated statement of continuing ICAO policies and practices related to environmental protection — Carbon Offsetting and Reduction Scheme for International Aviation 2019, Article I.5, I.6). In contrast, the EU upholds a ‘leading’ and ‘unique’ role of the ICAO (ICAO 2019c:13).

Specifically, divergences between the EU and China on the role of the ICAO can be highlighted in two main aspects: firstly, the ambition and feasibility of emissions reduction targets, and secondly, the implementation of MRV measures under the ICAO.

Firstly, the ambition and feasibility of emissions reduction targets under the ICAO: Officially determined at the ICAO’s 37th Assembly in 2010, the CNG2020 target of maintaining the international net carbon emissions by the aviation sector from 2020 at the same level is considered as a global aspiration goal to pursue the sustainable development of the aviation sector. As demonstrated in all China’s Reservations to ICAO’s Resolutions regarding climate change and the MBMs for the aviation, the country has constantly voiced its concerns about the bindingness and feasibility of the CNG2020 target. It criticizes that this target is unfair and does not reflect specific circumstances of the still maturing aviation in developing countries. As indicated in its Reservation to Resolution A40-19, China objects to adopting the CNG2020 target as the CORSIA’s baseline. In comparison with China, the EU member states in their Reservations to Resolution A37-19 and A38-18 argue that the CNG2020 goal is insufficient to limit the global temperature to well below 2 °C as determined in the Paris Agreement. Considering fast-growing aviation emissions, they maintained that it is necessary to pursue the collective goal of 10% emissions reduction based on the 2005 levels by 2020. Nevertheless, since the ICAO’s 39th Assembly, the EU member states had partly changed their attitude towards the CNG2020 goal and recognized its significant contribution to the climate targets under the Paris Agreement (ICAO 2017a, 2019c). Moreover, unlike China, the EU member states are strong upholders of the CORSIA and its legally binding implementation. They decided to join the CORSIA from its initial phase and support the decision of the ICAO Council in revising the scheme’s baseline due to the COVID-19 impacts on aviation industries (Council of the European Union 2020; European Commission 2020b).

In terms of the 2050 ICAO Vision for SAFs, although China is not against the need of using SAFs to offset emissions, it strongly opposes the launch of the 2050 ICAO Vision as ‘a living inspirational path for a significant proportion of aviation fuels to be substituted with sustainable aviation fuels by 2050’ mentioned in Resolution A40-18 (ICAO 2019a: 3). China criticizes that the 2050 ICAO Vision does not reflect the will and capabilities of all countries. Thus, in its Reservation to Resolution 39–2 and 39–3, China insists that each country has the right to determine the SAFs certification based on its specific national circumstances. Furthermore, while fully recognizing the potential of alternative aviation fuels in reducing emissions, China underlines the uncertainties of SAFs’ production capacity and its contribution to the ICAO targets (ICAO 2017b). By comparison, the EU member states are advocates of the 2050 ICAO Vision for the SAFs. Notwithstanding challenges in using these fuels for the aviation sector, the EU underscores that through effective policy measures undertaken by the ICAO and its member states, there is a high possibility that the SAFs can contribute significantly to the achievement of the ICAO emissions reduction targets (ICAO 2019c, 2019e).

Regarding the future new long-term goals under the CORSIA, China stresses in its Reservation to Resolution A40-18 that the existing target of enhancing energy efficiency annually by 2% as early as 2009 is sufficiently ambitious. Therefore, there is no need to establish new long-term goals, which should be strictly based on thorough research of the ICAO Council into the equality and feasibility of these goals themselves, as well as the availability of support for developing countries. In contrast, the EU member states underline the need to build further long-term offsetting targets under the ICAO’s framework (ICAO 2019c).

Secondly, the implementation of MRV measures under the ICAO: As mentioned in the previous section, in June 2018, the ICAO Council adopted the first edition of Annex 16, Volume IV, which refers to the SARPs. These MRV requirements of the CORSIA officially took effect from January 2019. According to it, aircraft operators are obligated to monitor their carbon emissions in each international flight and submit annual reports regarding their emissions (ICAO 2018). During this process, the implementation of the CORSIA eligible fuels mentioned in Resolution A40-19 aims at providing an effective method to control aviation emissions.

In China’s view, the ICAO lacks authority to develop any mandatory regulation or standard for emission units (ICAO 2019d). As determined in the Chicago Convention, the ICAO is a specialized agency of the United Nations with the main targets of ensuring safe air transport and economical operation in the civil aviation sector, rather than offsetting emissions. Thus, in its Reservation to Resolutions A39-2 and A39-3, China argues that policies regarding reducing aviation emissions under the ICAO should by no means have binding force. China is against the implementation of the SARPs as the MRV requirements of the CORSIA (ICAO 2016a, 2019d). In its Reservation to Resolution A40-19, China criticizes that the definition of CORSIA eligible fuels lacks scientific basis. By comparison, the EU member states support the use of the CORSIA eligible emission units as an important factor to achieve offsetting targets under this scheme (ICAO 2019c). Besides, they firmly uphold the establishment and implementation of the SARPs, which from their perspective are in line with climate targets under the Paris Agreement and represent collective actions of countries to achieve the CNG2020 goal. As indicated in ICAO (2019c), the EU member states uphold the fairness and binding force of the SARPs and are committed to implementing them.

The driving forces behind the EU-China divergences

Normative-related factors

Firstly, China’s concerns about sovereignty and fairness regarding burden sharing between developed and developing countries in addressing climate change: In retrospect, China’s firm adherence to sovereignty explains why it was circumspect about the MRV measures discussed during the 2009 United Nations Climate Conference in Copenhagen (Huang 2017). Besides, during the run-up to the 2015 Paris Conference, China insisted that ensuring the transparency of the MRV rules should be implemented in a non-intrusive manner and respectful of the different national circumstances and state sovereignty (Bo and Gao 2014). Given that safeguarding sovereignty has been regarded as an overriding priority in climate foreign policy of China, it is reasonable that the country vehemently opposed Directive 2008/101/EC which includes international aviation activities under the EU ETS (Liang and Zhang 2014). Besides this, China’s consideration of state sovereignty has been reflected in its cautious stance towards the CORSIA and the SARPs. In fact, within the ICAO’s framework, China has often underlined that the establishment and implementation of the global MBMs in controlling international aviation emissions should take into account the issue of state sovereignty (ICAO 2015, 2017a, 2017b).

Historically, China played an important role in pushing forward the CBDR-RC principle under the UNFCCC. From its perspective, any international framework and negotiation of tackling climate change should be respectful of this principle (Bo and Torney 2016). China’s consistent adherence to the CBDR-RC has led it to refute all proposals for new interpretation of this principle, which ‘has become one of China’s key goals in global climate change negotiations’ (Bo 2017:197). This explains why China continued taking its relentless efforts to push forward the listing of the CBDR-RC amongst other guiding principles for the MBMs in Annex of ICAO’s Resolution A38-18. During the global climate negotiations, China has consistently highlighted the aspect of differentiated responsibilities and respective capabilities of the CBDR-RC principle. It has reiterated that developed countries need to take the lead in addressing climate change and consider the priority needs of developing ones to alleviate poverty and promote their economic growth. Moreover, it is the responsibility of the former to provide support in technology, finance and capacity building to the latter to help it tackle climate change effectively (Bo and Torney 2016). China’s deep-rooted concern about the fair distribution of responsibilities for climate change mitigation has been a fundamental reason why it did take a cautious stance towards binding emissions commitments at the 2009 Copenhagen Conference, for which it was widely criticized to ‘wreck’ or ‘hijack’ the international climate deal (Lynas 2009; Vidal 2009). In this above context, it seems reasonable that China is against the one-size-fits-all CORSIA standard, which has been estimated to create higher cost burdens and reduction pressure for developing countries than developed ones (Fan and Liao 2020; ICAO 2019d). Likewise, China opposes the one-cut-for-all standards of the ‘sustainability’ term, which from its perspective should rather be defined based on different national circumstances and uphold the No country left behind target of the ICAO (ICAO 2017b). Besides this, as demonstrated in its Reservation to Resolutions A40-18 and A40-19, China has questioned the fairness of the CNG2020 target which falls short of appropriate considerations regarding different historical responsibilities and coping capabilities amongst developed and developing countries. In its view, since the aviation creates a great momentum for the development of the whole economy and society, it is the legitimate right of developing countries to promote this sector’s growth (ICAO 2019d).

Secondly, the EU’s target of strengthening its leading role in the global climate governance and its perception of the CBDR-RC principle: Assuming itself as a global climate leader since 1990s, the EU has continuously taken effort to push forward the ambitious and binding international commitments in mitigating emissions. In fact, its actorness in global affairs regarding climate change has become a topic of research (Delreux 2014; Groen and Niemann 2011; Pavese and Torney 2012). To put that into context, fast-growing international aviation emissions have contributed significantly to the process of climate change. Indeed, the EU also stresses the urgent need of tackling emissions from aviation activities in Article 19, Directive 2008/101/EC when referring the estimations of the Intergovernmental Panel on Climate Change (IPCC) about increasingly severe impacts of these emissions on the global climate (Council of the European Union and European Parliament 2009). Thus, the EU’s perception of its leading role in addressing climate change can be viewed as one driving force for its policy of including international airlines under its ETS. Besides this, it is worth noticing that the EU’s role in the post-Copenhagen periods has been widely seen to be weakened (Bo and Chen 2011; Bäckstrand and Elgström 2013). Within that context, it is logical that the EU member states continue to show their actorness within the ICAO by firmly supporting the binding offsetting targets and the establishment of the global MBMs under the ICAO, which helps the EU regain its leading role in the global climate governance.

Whereas China highlights the different historical contribution and coping capabilities amongst developed and developing countries, the EU puts more emphasis on the common responsibilities of all countries in addressing global climate change. Historically, the EU has reiterated that this principle should be reinterpreted, and developing countries need to accept binding commitments in emissions reduction (Bo 2017; Bo and Torney 2016). This reveals why the EU member states firmly rejected the recognition of the CBDR-RC as one of guiding principles for the MBMs at the ICAO’s 38th Assembly. In their formal Reservation to Resolution A38-18, they stress that:

The guiding principles were originally intended to guide States in the design of regional and national measures. A state lacking capability to implement national measures would not apply these principles in the first place. […] Many carriers based in less developed countries are in fact among the largest, the most advanced and the most profitable in the world. (Written statement of Reservation by Lithuania on behalf of the member states of the European Union and 14 other member states of the European Civil Aviation Conference (ECAC) with regard to ICAO Assembly Resolution A38-18 2013:3)

In its perception of fairness, the EU adopts an egalitarian approach which excludes different treatment amongst countries. The avoidance of discrimination is the EU’s underlying argument to object the implementation of the CBDR-RC principle in the MBMs, as well as defend its ETS application to the international airlines (Runge-Metzger 2011).

Economic-related factors

Firstly, China’s concerns about the growth of its aviation industries and challenges in promoting the large-scale deployment of the SAFs: Although the EU has insisted that the application of the EU ETS to international airlines merely creates negligible extra costs for them (EUbusiness 2012; Runge-Metzger 2011), it has widely been estimated that this unilateral policy will result in a significant economic loss for non-European airlines, including those from China (de Domingos 2012; Xu 2012). According to the CATA, only in 2012, the EU ETS would cause around ¥800 million loss for Chinese airlines, which would be above threefold by 2020 (Lan 2011). This would lead to the weakening in competitiveness of Chinese air transport, followed by the competition distortions between European and Chinese airlines (Liang and Zhang 2014).

Besides, it is important to note that along with the rapid economic growth of China, the development of its aviation industries has been at a high speed. According to the International Air Transport Association (IATA), under the current trajectory, China will overtake the USA as the biggest global aviation market by mid-2020s (IATA 2018). By early 2030s, above 6000 new aircrafts will be required to meet increasing air transport demand (Boeing 2015). In fact, the CAAC has underscored fundamental tasks to strengthen the Chinese aviation sector under the 13th Five-Year Plan (FYP), and investment projects for the new airport constructions and large aircraft manufacturing have been launched (CAAC 2017; Huang 2017). For example, C919 which is currently the biggest project of the Commercial Aircraft Corporation of China, Ltd. (COMAC) showcases China’s ambition within its national strategic plan of ‘Made in China 2025’ to build its indigenous commercial aircrafts. Yet, it is important to mention that C919 aircrafts still use the non-domestic CFM International engines, and half of their components are not produced in China (Lema 2019; Wong 2018). Thus, China’s dependence on foreign imports remains a big challenge for its aircraft manufacturers to compete with their international counterparts, namely Boeing and Airbus.

The rapid development of Chinese aviation and aircraft manufacturing, which is considered as a crucial strategic driving force for the whole economy, will lead to the continuous emissions growth in the future, followed by the increasing pressure to reduce aviation emissions (Fan and Liao 2020; ICAO 2019d; Liu 2019). Besides this, China’s participation in the global MBMs under the ICAO means that the country would need to significantly increase the use of more fuel-efficient airplanes whereas its aircraft operators would be required to abide by the strict MRV regulations regarding CO₂ certification standards (ICAO 2018). In such a dynamic situation, it is reasonable that China has continuously voiced its concerns about the implementation of the global MBMs for the aviation, which might impede the development of its aviation and aircraft manufacturing (ICAO 2015, 2016e).

Besides, challenges in promoting the large-scale deployment of the SAFs are one factor which helps explain China’s stance on reducing aviation emissions under the ICAO. In recent years, the country has pushed forward research and investment projects regarding the deployment of biofuels, and a target for the 15% share of these fuels in transportation energy by 2020 has been set by the National Development and Reform Commission (NDRC) (Zhao 2015). The first test of biofuel flights was conducted by Air China in 2011, followed by other tests of China Eastern in 2013 and Hainan Airlines in 2015 (Tu 2015; Wang 2013; Xinhua 2013). In 2019, one intercontinental flight which utilized biofuels had been operated by China Southern Airlines (Biofuels International 2019). Nonetheless, the expensive cost of alternative fuels, including biofuels, has posed a big challenge for their wide application to the aviation sector (ICAO 2017b; Tu 2015). Therefore, China remains sceptical about the ambitious 2050 ICAO Vision mentioned in Resolution A40-18 regarding the large replacement of aviation fuels by SAFs. Besides, it is of the view that the definition of sustainability should reflect the specific national circumstances of developing countries (ICAO 2017b).

Secondly, the EU’s considerations of its ETS role in the global carbon market, the competitiveness of European airlines and the conformity between the 2050 ICAO Vision and the EU policies regarding the SAFs: Being impacted by the global economic crisis, the implementation of the EU ETS in the first phase from 2005 to 2007 has been widely recognized to be inefficient due to problems of price volatility and over-allocation of permits (Bayer 2018; European Environment Agency 2013; Friends of the Earth Europe 2010; Hübner 2013; Laing et al. 2013). Thus, the EU ETS reform, including the broadening of its scope to the international aviation, can be considered as one political measure to strengthen this system. Indeed, Article 35 of Council of the European Union (2007:13) clearly mentions that:

Given the central role of emission trading in the EU's long-term strategy for reducing greenhouse gas emissions, the European Council invites the Commission to review the EU Emissions Trading Scheme in good time with a view to increasing transparency and strengthening and broadening the scope of the scheme […].

Likewise, the intention of the EU to develop its ETS as a crucial building block of the international carbon market has been indicated in European Commission (2006) and European Commission (2007). Particularly, it is clearly stated in European Commission (2007:9) that ‘[t]he Commission is also preparing proposals to broaden and strengthen the EU ETS with effect from 2013 to ensure it remains a solid building block of the future global carbon market’.

Moreover, it has been widely argued that by imposing emissions taxes on extra-EEA flights, the EU aims at maintaining the competitiveness of European airlines (CCIEE 2012; Cheng 2011; de Domingos 2012; Liang and Zhang 2014). Indeed, Directive 2008/101/EC also indicates that besides the aim of environmental protection, another reason for including non-EEA flights under the EU ETS is to ‘avoid distortions of competition’ (Council of the European Union and European Parliament 2009, Article 16).

In terms of the conformity between the emissions offsetting objectives under the ICAO and the EU’s current climate policies, it is noticeable that the EU had pushed forward ambitious actions to tackle emissions, namely the 2020 climate and energy package, the 2030 climate and energy framework and the 2050 long-term strategy. Particularly, the European Green Deal was published in December 2019, which underscores the EU’s ambitious targets of offsetting 90% emissions in transport and achieving carbon neutral growth by 2050 (European Commission 2019). Following the rapid development of air transport, reducing aviation emissions is determined to contribute significantly to these above-mentioned targets. Regarding the SAFs, the EU has set out specific strategies for promoting biofuels and other renewable fuels. For instance, back to 2003, Directive 2003/30/EC was issued with a focus of increasing the use of these fuels in transport, followed by the adoption of the Biomass Action Plan on December 2005 (European Commission 2008). The 2050 ICAO Vision itself is in line with the EU’s current policies regarding promoting SAFs, namely the new Renewable Energy Directive (REDII). Particularly, under the ‘Sustainable and Smart Mobility Strategy’ which was launched on 9 December 2020, work for pushing forward the ‘ReFuelEU Aviation Initiative’ has been in progress. As mentioned in European Commission (2020c), this initiative aims at the large deployment and uptake of the SAFs.

Conclusions

This paper attempts to make several contributions to the still limited literature regarding the EU-China divergences on reducing global aviation emissions. Firstly, it has traced back the emergence, development and deepening of their divergences from 2007 to 2020 by providing an exhaustive historical overview of their different stances towards tackling aviation emissions. Secondly, it has offered an in-depth analysis of the EU-China divergences on three specific issues, i.e. under which framework to address global emissions from the aviation sector, whether and how to reflect the CBDR-RC principle in the design and implementation of the global MBMs for international aviation and which role the ICAO should play in offsetting these emissions. It can be drawn from the research results that the EU and China do not hold different views on the urgent need of reducing aviation emissions. Rather, at the core of their divergences is the question regarding how to distribute fairly the responsibilities for combating climate change amongst developed and developing countries.

Thirdly, this paper has provided insightful explanations of the EU-China divergences on reducing aviation emissions. It does so by discussing several distinctive normative as well economic considerations of both sides. In terms of the normative-related factors, China’s concerns about sovereignty and fairness regarding burden sharing in climate change mitigation help explain its hardline stance on reducing global aviation emissions under the EU ETS and the ICAO. From a European perspective, the strengthening of the EU’s leadership in the global climate governance and its perceptions of the CBDR-RC are the key factors for explaining its positions in tackling aviation emissions. In relation to economic-related factors, China’s considerations about the rapid development of its aviation and aircraft manufacturing, as well as its limited capability in promoting the large-scale SAFs deployment, are underlying reasons behind its cautious stance towards the 2050 ICAO Vision and the implementation of the CORSIA. As for the EU, strengthening the role of its ETS in the global carbon market and enhancing the competitiveness of the European airlines are two main economic considerations behind the extension of its EU ETS to the international aviation. Besides, the EU member states’ firm support to the ICAO can be explained through the conformity between the emissions offsetting objectives under this organisation, namely the implementation of the CORSIA and the 2050 ICAO Vision and the EU’s current climate policies.

Author contribution

Work for accomplishing this manuscript was done by both authors. Mrs. Duong Thi Thuy Mai did the research and wrote the manuscript. Professor Bo Yan contributed her original idea about the topic and paper’s structure. She also made significant revisions in the first draft. Both authors read and approved the final manuscript.

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The authors declare no competing interests.