Event Summary
The Institute for China-America Studies (ICAS) convened a panel discussion on April 29 as part of DC Climate Week 2025, exploring how public, private, and international actors can find new pathways for cooperation on climate action especially amid growing geopolitical divergence between the United States and China. Drawing on diverse policy, academic, and economic expertise, the conversation focused on how to overcome fragmentation and harness shared interests in areas like energy transition, green technology, and climate finance.
The event opened with a reflection on the current situation and set the tone for the discussion. On the one hand, the physical and financial costs of climate change continue to rise. While on the other hand, the world’s 500 largest companies now estimate nearly $5 trillion in potential gains from climate-related business opportunities. As a result, there is a growing need to look for solutions to fill the widening gap between policymakers and entrepreneurs and realize the potential for climate collaboration.
The panel started by emphasizing that China is positioned to lead the next phase of green industrialization because of its top-down management and advantages in infrastructure and efficient energy transmission. These allow China to capture higher returns on climate investment, particularly in renewable energy and clean manufacturing, where the U.S. is still lagging far behind. The U.S. has certain structural strengths in human capital and innovation. For example, the speakers argued that 9 out of 10 top talents in climate-related fields stay in the U.S. Nevertheless, the U.S. lacks the same centralized capability to scale clean energy systems quickly.
It was also noted during the discussion that China’s economic motivations for decarbonization have become clearer over the last decade. It was agreed that while green transformation remains a contentious topic in the U.S., China’s manufacturing advantage and long-term economic aspirations have positioned it at the forefront of green technology deployment. Nevertheless, the U.S. still has a strong state-level leadership and private-sector momentum that continues to push energy transition forward, even during periods of weaker federal commitment.
The panel also offered empirical evidence suggesting that the U.S. energy transition has managed to remain relatively stable, particularly through subnational initiatives and innovation, regardless of administration changes. But on the other hand, the panelists also pointed out that China is increasingly seen as the global climate leader. The panelists suggested that although the two countries are diverging politically, their long-term climate trajectories still offer space for engagement, particularly in cases involving third party countries.
During the open discussion, a question was asked on why cooperation between the U.S. and China still matters. The panelists responded by pointing out the market structures’ differences: in the U.S., companies are more likely to be rewarded for sustainable practices through market incentives, while China still struggles to align market recognition with environmental sacrifice. In this respect, China could learn from the U.S. approach. Speakers also stressed the importance of maintaining open channels, even if formal cooperation is limited. A functional climate hotline or mechanism for modest engagement between Washington and Beijing can still serve as a symbol of global commitment.
The panelists reminded the audience that the U.S. and China together account for about 40% of global greenhouse gas emissions. If these two countries stop engaging meaningfully on climate, it would severely delay the global agenda. Their joint announcement prior to the Paris Agreement helped lay the foundation for that breakthrough, and similar leadership is still needed.
The conversation also turned to the role of third-party countries. The panelists jointly agreed that low-income countries, which contribute little to climate change but face disproportionate impacts, need expanded access to climate finance. International organizations have a key role in filling this gap. They also pointed to the growing significance of the European Union, both as a cooperative partner and as a regulatory force shaping China’s climate engagement.
The panel concluded with a call for responsibility-sharing and greater dialogue across sectors and borders. While U.S.–China relations remain strained, participants agreed that mutual understanding, steady engagement, and inclusive platforms are essential to delivering the ambitious climate outcomes the world urgently needs.
