Reclaiming Global Climate Leadership

The United States’ withdrawal from the Paris Agreement and its adoption of protectionist trade policies represent a profound challenge to the global fight against climate change. As one of the world’s largest carbon emitters, the US has a critical role to play in reducing greenhouse gas emissions. Its retreat from international cooperation not only undermines the transformation of the global energy system but also threatens the rules-based international trade order that has long facilitated shared progress.

The consequences of America’s withdrawal extend far beyond its borders. The "America First" agenda, characterized by tariffs and trade disruptions, has impeded the exchange of green technologies and renewable energy investments. Open trade systems are essential for lowering costs, transferring innovations, and building integrated solutions to combat climate change. Without these mechanisms, the path to achieving global emission targets becomes steeper and more uncertain.

Domestically, this retreat has left states, businesses, and communities grappling with the intensifying impacts of climate change. From devastating wildfires to catastrophic floods, the evidence of a warming planet is undeniable. Yet, the absence of US leadership has created a vacuum that other actors must now fill. This disjointed approach risks slowing the progress needed to safeguard future generations.

Despite these challenges, there are reasons for optimism. Both  China and European nations have demonstrated that bold, collaborative action can yield significant reductions in carbon emissions while driving economic growth. Their investments in renewable energy technologies, such as solar and wind power, have dramatically lowered costs and accelerated the transition to a low-carbon future. These efforts serve as a model for other regions to follow.

In East Asia, the proposal for a green trade bloc under the Regional Comprehensive Economic Partnership (RCEP) offers a promising pathway for advancing the climate agenda. By reducing the costs of sustainable goods and services and promoting technology transfer, such initiatives can catalyze economic growth while addressing environmental challenges. Establishing common financial frameworks for green investment further emphasizes the importance of collaboration in achieving sustainable outcomes.

Here, I would like to call the world community to revisit the report, I led the production of, in 1999 under the Arab Society of Certified Accountants (ASCA) in consultation with the United Nations and International Standards of Accounting and Reporting (ISAR) called: “Accounting and Financial Reporting for Environmental Costs and Liabilities”. This framework enables businesses to transparently disclose their environmental impact, aligning their operations with the sustainability goals. Today, these principles are more relevant than ever. By embedding environmental costs into financial reporting, I believe we can drive better accountability and incentivize responsible practices across many industries.

The global community must now rewire the traditional international trade order to adapt to the new reality of diminished US participation. Like-minded nations must double down on multilateralism, leveraging existing frameworks to keep markets open for low-carbon goods and services. By revisiting the principles outlined in my 1999 report, we can develop robust systems to address the financial and ecological impacts of climate change.

While America’s retreat from international cooperation is undeniably disruptive, it also underscores the resilience of the global climate agenda. Through strengthened alliances, renewed frameworks, and a steadfast commitment to environmental accountability, we can navigate these new waters we find ourselves in where the global leader has chosen to chart its own course, leaving the rest of the world to shoulder the burden of collective climate action on its own.

Talal Abu-Ghazaleh