Washington (AP) – President Joe Biden tried to define the world’s next steps against rapidly worsening climate change in a private virtual session with a small group of other world leaders on Friday, and announced a new pledge American-European to reduce climate change methane leaks.

Scientists’ ever darker findings this year that the world is approaching the point where the level of climate damage from the burning of oil, gas and coal becomes catastrophic and irreversible “represent a code red for humanity”, said Biden said at the start of the session.

“We have to act and we have to act now,” Biden said, speaking to a specially erected set at the White House that showed virtual arrays of solar panels in the background and a wall of other world leaders listening to music. screens.

He cited his tour earlier this month to communities affected by relentless California wildfires and Hurricane Ida in the northeastern United States and the Gulf – proof that warnings of natural disasters are s ‘worsening in number and severity as the climate warms is already becoming a reality.

Drought and rising temperatures have made California’s wildfire season virtually year-round, state fire officials say. And a study done this year concluded that rising sea levels caused by global warming caused an additional $ 8 billion in damage to the 2012 Super Storm Sandy.

“Over the past two weeks, I have traveled across the United States to see the damage and destruction,” Biden said. “The climate continues to change in Europe, Africa and Latin America, and you have suffered massive flooding. “

The Biden administration presented the meeting as an opportunity for some of the world’s leaders to strategize to achieve large and rapid reductions in climate-destroying oil and coal emissions. The administration is also trying to re-establish the United States Major Economies Forum – a climate group created by President Barack Obama and revived by Biden – as an important forum for international climate negotiations.

Friday’s meeting followed a much larger and more vibrant White House virtual climate summit in April that saw dozens of government leaders – representing allies and rivals, and large and small. savings – making radical speeches on the need to act on climate change.

Friday’s list of attendees included just nine leaders: those from Argentina, Bangladesh, Indonesia, South Korea, Mexico, the UK and the European Council, the Commission of the European Union and United Nations.

China, India and Russia, along with the United States, are the nations that emit the most climate-damaging gases from the production and combustion of oil, natural gas, and coal, and participation of their leaders has not been announced.

Climate advocates have stressed the importance of the United States’ coordination with Europe and Asia for a united front to lobby China, which emits more climate-damaging fumes than the rest of the developed world combined. , to accelerate the reduction of its use of dirty combustion coal. – thermal power stations in particular.

Biden, during the public opening of the otherwise private talks, also discussed a new U.S. deal with the European Union to cut methane emissions from the two entities by 30% by the end of this decade. Methane is one of the most potent agents of climate damage, gushing by the ton from countless uncapped oil and gas platforms, leaking gas pipelines, and other oil and gas facilities.

Fred Krupp, chairman of the nonprofit Environmental Defense Fund, said reducing methane pollution is the fastest and most effective strategy to slow the rate of warming.

A 30% reduction in methane pollution should only be “the entry point of this critical conversation.” Many countries can and should aim even higher, ”Krupp said.

The pledge comes as the U.S. Environmental Protection Agency prepares to propose stricter rules against methane emissions for the oil and gas industry, as outlined in one of Biden’s early executive orders.

The new rules, expected in the next two weeks, are likely to be stricter than an Obama-era standard established in 2016. The Obama standard was reinstated in June after Congress took the unusual step of invalidate a rollback of Trump-era methane protections. .

The EPA’s pending rule is expected to restrict methane emissions from new and existing wells, including hundreds of thousands of older wells that are not federally regulated under current law.

Biden has sought to re-establish the United States as a leader in global climate efforts after President Donald Trump withdrew the United States from the Paris climate agreement.

At home, however, Biden is still working to secure significant investments in climate-friendly measures, such as electric vehicle charging stations outside of Congress, amid objections from Republicans and some Democrats.

Friday’s session will be followed by another closed-door session of 35 to 40 world leaders, which will be hosted Monday morning by United Nations Secretary-General Antonio Guterres and British Prime Minister Boris Johnson.

The private sessions aim to ensure that world leaders travel to a United Nations climate session in November with pledges of important new actions to slow climate change. Biden and others see the UN climate summit in Glasgow as a last chance for the world to commit to cutting fossil fuel use fast enough to avoid worst-case scenarios of global warming.

“We need to bring our highest ambitions to Glasgow,” Biden said. “Those who have not yet done so, time is running out.”

___

Knickmeyer reported from Oklahoma City.

Apart from housing, the group has invested in electric vehicles, sports and amusement parks. She even owns a food and beverage business, selling bottled water, groceries, dairy and other products across China.

How did he encounter problems?

In recent years, Evergrande’s debts have exploded as she borrowed to finance her various activities.

The group has gained notoriety for becoming the most indebted developer in China, with more than $ 300 billion in liabilities. In recent weeks, he has warned investors of cash flow issues, saying he could default if he is unable to raise funds quickly.

The warning was highlighted on Tuesday, when Evergrande revealed in a stock exchange document that it was struggling to find buyers for some of its assets.

In some ways, the company’s aggressive ambitions are what put it in the hot water, experts say. The group “has moved away from its core business, which is part of how it got into this mess,” said Mattie Bekink, Chinese director of the Economist Intelligence Unit.

Goldman Sachs analysts say the company’s structure has also made it “difficult to get a clearer picture of [its] recovery. ”In a note this week, they highlighted“ the complexity of the Evergrande group and the lack of sufficient information on the assets and liabilities of the company ”.

But the group’s struggles are also emblematic of the underlying risks in China.

“The story of Evergrande is the story of the depths [and] structural challenges of the Chinese economy related to debt, ”Bekink said.

In a note Wednesday, Mark Williams, Chief Economist at Capital Economics for Asia, said the Evergrande collapse “would be the biggest test the Chinese financial system has faced in years.”

“The root of Evergrande’s problems – and those of other highly leveraged developers – is that demand for residential properties in China is entering an era of sustained decline,” he wrote. “The ongoing collapse of Evergrande has drawn attention to the impact a wave of developer defaults would have on China’s growth.”

How does he try to move forward?

On Tuesday, Evergrande announced that it had called in financial advisers to help it assess the situation.

While these companies are tasked with exploring “all feasible solutions” as quickly as possible, Evergrande warned that nothing is guaranteed.

So far, the conglomerate has struggled to stem the bleeding and has failed to find buyers for parts of its electric vehicle and real estate services business.

As of Tuesday, he had made “no substantial progress” in his search for investors, and “it is not certain that the group will be able to make such a sale,” he said.

The company also attempted to sell its office tower in Hong Kong, which it bought for around $ 1.6 billion in 2015. But this was “not completed on schedule,” he said. he declares.

How are investors reacting?

Evergrande’s troubles spilled into the streets this week when protests reportedly erupted at its headquarters in Shenzhen. Reuters images showed dozens of protesters at the site on Monday, accosting a person identified as a representative of the company.

But shareholders have been suspicious for months: the stock has lost 80% of its value this year.

Last week, Fitch and Moody’s Investors Services both downgraded Evergrande’s credit ratings, citing its liquidity problems. “We consider that some default is likely,” Fitch wrote in a note Tuesday.

“In our opinion, how the Evergrande credit strains are resolved will influence market sentiment,” Goldman Sachs analysts wrote, referring to the credit market and the economy in general. They added that the Chinese bond market could be affected and that a loss of confidence could “spill over to the real estate sector at large”.

Wall Street seems more optimistic about the risks of contagion abroad.

What could happen next?

Analysts expect the Chinese government to step in to limit the fallout if Evergrande were to default. And the authorities are clearly watching closely, while trying to project calm.

On Wednesday, Fu Linghui, spokesperson for China’s National Bureau of Statistics, acknowledged the difficulties of “some large real estate companies,” according to state media.

Without directly naming Evergrande, Fu said that the Chinese real estate market has remained stable this year, but that the impact of recent events “on the development of the whole sector must be observed.”

Williams of Capital Economics predicted that the country’s central bank would “step in with liquidity support” if fears of a major default escalated.

According to the report, officials in Evergrande’s home province of Guangdong have already rejected a rescue request from its founder. Authorities in Guangdong and Evergrande did not respond to a request for comment.

But some suggest it may already be too late to save the business.

Evergrande’s financial woes have been widely described by Chinese media as a “huge black hole”, implying that no amount of money can solve the problem.

“We ultimately expect the government to intervene in Evergrande’s case because it will not allow the company’s defaults to spill over into the banking system,” Bekink said.

“The impacts of a major Evergrande default would be remarkable.”

–Kristie Lu Stout, Julia Horowitz, Laura He and the Beijing office of CNN contributed to this report.

IIT’S NOTHING again for foreign companies to suffer the upheavals of the Chinese Communist Party. From revolutionary times, Chairman Mao’s victorious troops did not directly confiscate foreign assets as their Bolshevik predecessors did in Russia. Instead, they exhausted them with higher taxes and fines so large that companies ended up giving up their assets for nothing. In a memorable case unearthed by Aron Shai, an Israeli scholar, a British industrialist in 1954 said he handed everything over to the Communists, from “large blocks of godowns (warehouses) to pencils and paper”. And yet, he complained, Comrade Ho, his counterpart, continued to haggle “like a pre-liberation shopkeeper.”

Although multinationals have flocked to China since, government bickering continued, encompassing everything from technology transfer to free corporate investment. There have been big improvements, but the teasing is a constant reminder, as one American puts it, that companies shouldn’t get “too big for their pants.” Western companies operate in China with tolerance, and the country may one day seek to replace them.

As a result, some may have felt a sense of Schadenfreude that Chinese, not Western, companies have been the main victims of President Xi Jinping’s recent efforts to socially design a new type of economy. In the past week alone, the government has taken steps to lower barriers between tech giants Alibaba and Tencent, and, according to the Financial Time, ordered the dismantling of Alipay, a financial super-app owned by Alibaba’s sister company, Ant. Some even go so far as to make flattering comparisons between Mr. Xi’s efforts to emasculate China’s tech “oligarchs” and how US and European governments are preying on Western tech giants.

The heaviness, however, cools to an unusual degree. The whim too. Kenneth Jarrett, a seasoned China observer in Shanghai for the Albright Stonebridge Group, a consultancy firm, says the question on everyone’s lips is “who could be next? The crackdown comes against a backdrop of growing tensions between China and the West that leave multinationals stuck in a sort of semi-legal vacuum. For many, China’s appeal remains irresistible. But the perils overtake the promise.

Besides banks and asset managers, some of whose investments in China have been hit hard in recent months, several types of multinational companies are at risk. One group includes those who earn most of their money in China, from pimping to a golden elite who flaunt their purses and sports cars at $ 3,000. Another includes companies that irritate their customers for what can be interpreted as Western arrogance; Tesla, the electric car maker, is one example. A third category includes European and American manufacturers of advanced manufacturing equipment and medical devices that China believes must produce itself.

As usual, the threats come in the form of political announcements that seem deceptively bland. One, “common prosperity,” is a catch-all phrase ranging from reducing social inequalities to more pampering workers and clients to nanny overworked youth. Its most obvious impact is on Chinese tech, tutoring and gaming companies, which have lost hundreds of billions of dollars in market value as a result of government crackdown. Yet multinationals have also been caught in the fallout. In a few days in August, the valuation of European luxury brands, such as Kering, supplier of Gucci handbags, and LVMH, a seller of trinkets and bubbles, fell $ 75 billion after investors finally took Xi’s common prosperity agenda seriously.

Xi does not intend to force Chinese consumers to return to Mao’s costumes. But its war on flamboyance, especially among the wealthy who can spend at least $ 100,000 each a year on foreign brands, threatens the most lucrative part of the market. It also puts luxury brands at risk that charge Chinese consumers more than in their outlets, for example, in Milan. Flavio Cereda of Jefferies, an investment bank, expects the government to continue supporting a growing middle-class luxury market, as ambitious purchases reflect economic success. If China spoils the experience, the shock could be huge. Its consumers account for 45% of global luxury spending, he says. “No China, no party.”

“Dual circulation” is another buzzword with disturbing connotations. It is an attempt to promote self-sufficiency in natural resources and technology, in part in response to fears that a reliance on Western suppliers will make China vulnerable to geopolitical and trade pressures. But it also poses a threat to Western multinationals in China by reducing technology imports and creating a “buy Chinese” mentality. Friedolin Track BDI, a German industry federation, notes that state-owned enterprises in China have reportedly received procurement guidelines that require domestic supply of devices such as X-Beam machines and radar equipment.

Between a block and a hard place

Everything becomes a catch-22. On the one hand, America, Europe and their allies are in a geopolitical conflict with China, which they blame for human rights abuses in places like Xinjiang, home of the oppressed Uyghur minority. The West wants to restrict the technologies that its companies sell to China and the materials, like cotton, that they buy there. On the other hand, China is asserting its right to retaliate against companies it claims are engaging in geopolitics.

Jörg Wuttke, President of the EU The China Chamber of Commerce says the size of the Chinese market is worth it. “The biggest risk is not being in China,” he insists. Still, anyone with a long-term perspective might see Mr. Xi’s undisputed personal authority, his gamble on reshaping the Chinese economy, and the grim geopolitical backdrop as more than enough reasons to consider an exit. It may never happen to that. But as in the post-revolutionary era, sometimes one warning shot too many is enough to convince even the most daring industrialist to throw in the towel. ■

This article appeared in the Business section of the print edition under the headline “Who Will Be Next?”