After US President Donald Trump was elected to his second term, but before his inauguration, there was great uncertainty about what was in store. In Southeast Asia
there was concern over implication to trade and security, especially surrounding the US-China relationship.
Now that Trump has entered his third month in office, it is apparent that policy discussions are no longer theoretical. The United States is clearly taking a new direction, and one of the most immediate and consequential shifts has been in climate policy.
On the day of his inauguration, Trump
rescinded a slew of previous executive orders that were intended to do such things as deal with the effects of climate change on migration, address climate-related financial risk, strengthen emission standards on cars and trucks, advance environmental justice, and most importantly, implement the terms of President Biden’s signature legislative achievement, the Inflation Reduction Act of 2022.
That same day, the president directed the US Ambassador to the United Nations to formally
withdraw America from the Paris Agreement under the United Nations Framework Convention on Climate Change (UNFCCC).
These are just a sampling of the climate and sustainability-related policy moves announced in the first few months of Trump 2.0. Others fulfilled the campaign promise of “
drill, baby, drill”, to accelerate fossil fuel production,
cancelled a US$5 billion electric vehicle (EV) charging station programme, and even ordered US government websites
to remove references to the climate crisis.
More relevant to Southeast Asia, the United States
is ending its participation in the Just Energy Transition Partnership (JETP), which channels funds from more developed nations to countries like Vietnam and Indonesia to ensure their populations
“have equal opportunities to benefit from these (energy) transitions.”
Not the first time
Despite the dramatic reversal in climate policy, it is not without precedent. Under the Clinton administration, the United States signed the Kyoto Protocol to the UNFCCC, but it was not ratified by the senate. Later, when George W. Bush was in office, the US made it clear they would not take part. Similarly,
Canada also pulled out of the agreement.
It is what
Professor Ben Cashore, Director of the Institute of Environment and Sustainability (IES) at the Lee Kuan Yew School of Public Policy (LKYSPP), describes as a “faux paradigmatic” change in policies. “That’s when you think a lasting change has been made, and then all of a sudden, it's not. It goes back to what it was before.”
It happens so frequently in environment-related policy that Professor Cashore refers to it as
the “policy creation euphoria, implementation depression” cycle of global environmental governance.
What is different this time, however, is the extraordinary way the Trump administration is making the change. Professor Cashore said, “It's a wholesale attack on climate science, on climate deliberations, on climate as a problem”.
Global effect
What does this mean for the rest of the world dealing with climate issues such as rising global temperatures, extreme weather, biodiversity loss and sea level rise? Will international efforts to mitigate climate change be affected if US withdraws support?
Professor Cashore said that while the broad scale effect is not good news for climate policy, “it's not all bad news”.
“When there are leadership vacuums, other countries and regions seek that vacuum,” he said. “And if they see strategic interest in filling it, they will. And I think there's a real opportunity in Asia especially to fill that vacuum.”
Professor Cashore pointed out China’s leadership in investing in clean tech such as solar and electric vehicles (EVs) in both the public and private spheres. In 2024,
China invested $940 billion in clean-energy, which is nearly the same amount as the entire world devoted to fossil fuels during the same time period. EVs and batteries made up the largest portion of China’s clean-energy economy,
comprising approximately 39 per cent of GDP.
China is still a
party to the UNFCCC and a
signatory to Paris Agreement and continues to
invest in Southeast Asia. “That's a service to the planet when it comes to thinking about the climate crisis,” he said. “China's being criticised at the same time, for building more coal plants, however those paradoxes occur in all countries and there's no denying that the acceleration of clean tech at multiple levels, including carbon markets in China have been important developments that have reflected global climate concerns.”
Opportunities for Southeast Asia
The Trump administration also intertwines tariffs with climate-related policy. For example, the Trump 1.0 administration levied a
27.5 per cent tariff on electric vehicles from China. The Biden administration later increased the tariff to 100 per cent and raised tariffs on Chinese solar panels to 50 per cent as a way to incentivise domestic production.
Professor Cashore said this speaks to a phenomenon that plagues efforts to reduce greenhouse gas emissions. Producing technologies that are lower in carbon intensity is a key pathway to global decarbonisation. National industrial policies to support green tech also require domestic political support. But if domestic workers feel threatened by low-cost imports of green tech products, it can weaken political support. “You can't solve this problem easily. What we've been arguing at IES and elsewhere is that you have to handle them together and find the most effective interplay of support for domestic green industrial policies that are often viewed as protectionist but that can also reinforce political support, while still continuing to accelerating the ratcheting up a global dynamic towards clean tech and low carbon intensity produced goods.”
Professor Cashore sees this as a potential opportunity for Southeast Asian nations to have a conversation on free trade and clean tech. “Governments in Southeast Asia are innovative and are being proactive. They are thinking way into the future, as is China. So why wouldn't they think about this now? And if they did, this could be a historical opportunity!” He points to the many advancements that are taking place at the sectoral level — below the macro industrial policy — that are accelerating clean tech. For example, Thailand launched a series of
domestic incentives supporting EVs in 2022 and LKYSPP’s
Professor Vu Minh Khuong has argued that Vietnam’s generous feed-in-tariffs led to a veritable
“renewable energy revolution” with its solar and wind generation reaching 10.5 per cent and 1 per cent respectively as of 2021.
As Professor Cashore concludes, “It seems quite clear there is an opening here. Why wouldn't Southeast Asia and Asia fill that void? It just makes sense that they actually would.”
This article was written and contributed by David Austin.