Trade measures that impose tariffs and penalties on cleantech and emissions-intensive goods are poised to re-emerge as a challenging issue at the UN climate talks in Türkiye next month, after China signalled it wants COP31 to focus on ensuring the free flow of green technologies.
China, which dominates global manufacturing of cleantech equipment, has staunchly denounced US and EU tariffs and measures restricting the import of Chinese green technologies, which Washington and Brussels argue receive unfair government subsidies that threaten their nascent domestic industries.
China’s vice-minister of ecology and environment, Li Gao, told a press conference last week that COP31 should discuss the free flow of green technology as well as trade “unilateralism and protectionism”, warning that Beijing would give a “firm response” to attacks against it.
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Trade tensions spilled over into the climate negotiations at COP30 in Brazil last year, quickly becoming one of the talks’ major flashpoints after large emerging economies, including China, India and South Africa, pushed to get “unilateral trade measures” on the agenda of the UN climate negotiations.
Observers of the UN talks told Climate Home News trade is likely to re-surface as a major sticking point between the EU and emerging economies, including China, during COP31 this November after newly created spaces for dialogue on climate and trade adjacent to the formal negotiations have so far failed to yield practical solutions on a way forward.
“We should be prepared for the climate-trade issue to be one of the prominent issues in Antalya,” said Li Shuo, director of the China Climate Hub at the Asia Society Policy Institute.
China’s game plan unclear
Although there is currently no designated track in the negotiations to discuss trade issues, China and other large emerging economies have repeatedly used the climate conference to air their grievances over trade barriers. How far China is willing to push the issue within the UN climate process and what it hopes to achieve remain unclear, however.
The vehemence which characterised the trade discussions at COP30 could be tempered in Antalya next month, Li said.
“My expectation is that all sides will be mindful of the trade issue creating more frictions to the multilateral system and will be more measured at COP31,” Li told Climate Home News. “That said, we should continue to expect rhetoric around this issue. Domestic politics in different countries will demand emotions on this issue to be unleashed.”
An EU-China deal struck earlier this month to halve exports of Chinese hybrid vehicles to the bloc could also help ease tensions, with further talks planned in March.
The Trump administration did not send an official delegation at COP30 and is not expected to attend COP31 either, after it quit the Paris Agreement and is also withdrawing from the UN climate convention.
A space for dialogue
At COP30, China and other large emerging economies used the trade discussions to take aim at the EU’s Carbon Border Adjustment Mechanism (CBAM), which they staunchly oppose.
The mechanism imposes a border levy on imports of high-emitting products from countries with less stringent emissions regulations to protect European industries from unfair competition and help drive down emissions. The UK is set to implement its own version from January.
But China and other developing countries argue that the levy violates international trade rules and disproportionately punishes countries with fewer resources to clean up their industries or pay a premium for greener products in their supply chains.
To keep the issue outside the formal negotiations, the COP30 Brazilian presidency bundled trade with other contentious issue into an overarching political decision, in which governments agreed to establish the first UN climate and trade dialogue.
The “Global Mutirão” decision repeated previously agreed language that unilateral measures to address climate change “should not constitute a means of arbitrary or unjustifiable discrimination or a disguised restriction on international trade”. Brazil also launched a voluntary climate and trade forum for countries to discuss how trade can support sustainable economic growth.
But recent discussions “have remained stuck at the level of principled debate and have failed to identify practical solutions”, said Ellie Belton, who tracks climate and trade issues for think-tank E3G.
Voluntary dialogue off on wrong foot
During the first of three trade dialogues scheduled annually between now and COP33, countries largely reiterated their existing positions at the June session in Bonn.
The EU defended its carbon border mechanism, and noted that the dialogue “should not become a space to address trade disputes or make judgements about the legitimacy of climate measures”. A spokesperson for the European Commission told Climate Home News that the bloc “welcomes continued dialogue” to enhance cooperation on measures to prevent carbon leakage.
Russia and the group of African countries suggested the creation of a formal negotiation track for trade discussions at the UN climate talks. But the EU and other developed economies will be reluctant to reopen the matter in Antalya, said Belton.
Meanwhile, the first meeting of the Integrated Forum on Climate Change and Trade (IFCCT) – also held during the Bonn climate talks – was poorly attended after last-minute participation by Russia, which led many developed countries skipping the dialogue, three attendees told Climate Home News.
Countries that joined the session “had a useful discussion but it wasn’t the meeting it was originally envisioned to be”, one delegate said.
Can UN climate talks deliver trade progress?
Although the World Trade Organization is the obvious venue to discuss trade issues, it does not assess the climate impacts of trade interventions – a gap the UN climate talks could help bridge, observers say.
“Trade can generate real economy benefits to help advance global climate action – failing to address this at the UNFCCC is a missed opportunity,” said Belton, of E3G. “Unfortunately, it is likely to remain challenging to focus attention on the positive role of trade co-operation at COP31 if these longstanding tensions continue to consume so much bandwidth,” she added.
Some of the solutions proposed by countries in the first trade dialogue included ways to make different carbon markets work together, including by exchanging data, and using free trade agreements to lower barriers for clean technologies.
Access to affordable clean energy technologies such as solar panels, EVs and batteries has become a key issue for developing countries seeking to wean their economies off expensive and polluting fossil fuels. At the same time, nations want a share of cleantech value chains to create jobs and spur development.
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A background paper for the climate and trade forum, seen by Climate Home News, shows that some of the areas identified for co-operation include reducing the cost of low-carbon trade, protecting trade flows after climate-induced disasters, and better connecting systems to report and verify the sustainability of traded goods.
Alden Meyer, a senior associate at E3G, said the forum is meant for countries to “hold hands and move together in a more ambitious and faster way” without the need for global consensus required by formal negotiations.
Meanwhile, the accompanying trade dialogues are designed to “feed into the negotiations over the second Global Stocktake” at COP33, where countries will issue a set of recommendations to ramp up global climate policies. This package could include trade provisions for the first time.
“That could be useful if the next two years demonstrate that there’s a willingness to look for ways in which the UNFCCC can be constructive in the trade space, and make trade a driver of climate ambition rather than a finger-pointing exercise and an irritant,” Meyer said.
The post Tensions set to flare over trade at COP31 as China makes it a priority appeared first on Climate Home News.
Tensions set to flare over trade at COP31 as China makes it a priority
Tens of billions of dollars in international climate finance have been pledged this decade for a “just energy transition” in the Global South. Most of the money, promised by wealthy governments and banks, will be funnelled into infrastructure – mainly shuttering fossil fuel power plants or installing renewables.
But these investments in the shift to low-carbon economies affect workers and communities and therefore require their support. Without funding for social protection and participation, their backing is unlikely, putting the transition at risk, climate justice experts warn.
Several headline-grabbing “Just Energy Transition Partnerships” (JETPs) were announced in 2021 and 2022, including for South Africa at the UN climate conference in Glasgow and Indonesia at the G20 summit.
While there is a need for fair, green transitions across all economic sectors, from vehicle manufacturing to farming and health, it is energy that has attracted the most attention and money so far. The early results have been mixed, with progress on moving away from coal power in the countries with JETPs slower than hoped for.
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Another challenge is that the vast majority of the JETP funding on offer is in the form of loans, with the grants needed to support local communities through the transition making up a tiny fraction.
Of the finance pledged to South Africa, Indonesia and Vietnam under their JETPs, grants accounted for just 4%, concessional below-market-rate loans for 53%, commercial loans for 25% and guarantees for 13%, according to a policy brief produced for the G20 in Brazil.
Spotting a major gap in the justice side of these partnerships, philanthropic foundations in 2023 established a $20-million fund to support community-based and non-governmental groups in JETP countries in their efforts to secure a fair deal for local people.
Philanthropies back community input
During three years of giving grants to 60 community organisations, unions and researchers, ClimateWorks Foundation – which set up the Global South Just Transition Fund with the IKEA and Laudes foundations – has learned what it takes to complement the JETPs.
“They are built to move money to energy projects, and our grants build the civic and governance infrastructure that lets that money land,” Justin Sylvester, just transition director at ClimateWorks Foundation, told Climate Home News.
The results achieved with the Fund’s backing include progress on a subnational Natural Resource Fund model in Indonesia backed by the finance ministry, which offers a route for districts to channel coal revenues into developing communities’ post-coal economies.
Comment: Santa Marta was a learning moment for how to shape inclusive just transitions
In South Africa, meanwhile, nonprofit INSPIRE has worked with solar developer Forethought Capital to build trust with community leaders and secure signed lease agreements for solar projects on protected communal land – a model that can be replicated.
One key lesson so far, Sylvester said, is the importance of building civil society’s economic, civic and cultural power – not just its capacity. Another is the need to get behind social ecosystems rather than isolated projects, and collaborate with other funders.
“Results come when a community group, a researcher, and a ministry work on the same issue at the local, regional, and national levels,” he said. “We see clear wins when communities can shape transition decisions rather than only react to them, with positive policy outcomes, court rulings, and public money moving.”
The missing finance category
Despite the importance of these early efforts to ensure an equitable green future for communities on the ground, no one knows how much money is going towards it. That is largely because, as an emerging category of climate action that has evolved only in the past few years, funding for just transitions is not yet being comprehensively measured or tracked.
Nor is there consensus on how much will be needed as the energy transition gathers speed. Estimated requirements for international support for developing countries range from a high-level climate finance panel’s $50 billion a year by 2035 to $242 billion a year from the Civil Society Equity Review. But these figures are hard to compare directly.
A new discussion paper on finance for just transition and how it fits with a new Just Transition Mechanism (JTM) due to be established at the upcoming COP31 climate summit in Antalya notes that it faces “a definitional, methodological and accounting challenge”.
It defines just transition finance as “finance coming primarily from public sources, above all grant-based, highly concessional and non-debt-creating, that supports the policies and measures needed to move economies away from extractive, carbon-intensive models while distributing costs and benefits fairly”.
Co-author Jodi-Ann Wang, a research fellow with the Just Transition Finance Lab at the Grantham Research Institute, told a webinar on the paper’s findings there is as yet no common tracker or shared taxonomy in place, nor oversight to monitor such flows.
“Opacity is… costing us a sound understanding of just transition finance,” she said.
This is where the “Belém-Antalya Just Transition Mechanism” – or BAM, as it’s known among the civil society groups that advocated strongly for it – comes in.
From Belém to Antalya – gains, gaps and challenges for a new Just Transition Mechanism
Resource mobilisation group under BAM
As part of its objectives, form and methods of working, which countries will begin to define at the COP31 negotiations in Türkiye, Climate Action Network (CAN) International, a coalition of hundreds of NGOs, is pushing for the JTM to include a “resource mobilisation group”.
This, the paper explains, could explore and develop ways to boost the quantity, quality and governance of finance for just transition around the world, with a view to making it more accessible and equitable.
More concretely, it could map available sources of support and funding gaps, inform the new JTM on financial realities and needs, and propose partnerships between financial institutions, donor countries and actors implementing just transition on the ground.
Rebecca Thissen, CAN’s global advocacy lead who co-authored the paper, emphasised that the aim is not to set up yet another UN climate fund – something donor governments are wary of. Instead, she described the role of a resource mobilisation group as “more agile and innovative”.
One of its first tasks would be raising awareness about just transition finance – not yet an established category of climate funding. Climate finance has traditionally fallen into two main categories: mitigation (measures that cut emissions, such as installing renewables) and adaptation (protecting people, infrastructure and livelihoods from climate change impacts).
A third pillar has recently emerged: loss and damage (responding to and minimising destruction and harm caused by climate-driven disasters and longer-term stresses).
Just transition finance here, there and everywhere
The time has come to add just transition into the finance mix, argued Thissen, explaining this could be done through two main approaches. The first is to ensure that the existing areas – mitigation, adaptation and loss and damage – have a strong justice component integrated into them.
The second is to identify specific just transition policies and measures that “fall through the cracks” of those three types of climate finance and show how they can be funded separately.
Examples given in the paper include Ireland providing a fuel allowance and tax rebates for low-income households to offset additional costs from its carbon tax, Romania offering retraining opportunities in its coal region, and Chile funding ecosystem restoration for polluted areas to recover from resource extraction.
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Spain’s government, in addition, has been widely praised for funding formal pacts and just transition strategies in areas where coal mining and power has been phased out, based on tripartite consultations with national, regional and local administrations, unions and industry.
NDCs get serious about just transition
The emerging discussion around just transition finance comes as governments have begun incorporating the concept of just transition, and how to pursue it, into their national climate action plans (NDCs) in a far more meaningful way.
A report from the International Labour Organization, which covered 123 countries that had submitted updated NDCs by November 2025 – the third set of NDCs since 2015 – found that explicit references to “just transition” appeared in 79%, up from 50% in the second cycle.
It said many countries have moved beyond single mentions of just transition to multiple references or even dedicated sections, while around half of NDCs now reference follow-up mechanisms or institutional arrangements for just transition.
Mentions of explicit resources being allocated for just transition rose to 26% – whether in the form of financial commitments, budget lines or designated funding channels – compared with 2% in the previous round of NDCs.
The report also cast the net wider, showing that employment has become a common consideration when it comes to climate action, with 90% of the latest NDCs referencing employment and giving growing attention to green jobs and decent work. Social inclusion and equity, meanwhile, are also more prominent, appearing in over three-quarters of NDCs.
Labour rights lens puts focus on all workers
This broader lens on just transition fits with the