Beijing - China voiced its deep concern and opposition on
Thursday to a European Union plan to counter airline emissions, and called for
talks to resolve the issue a day after China's major airlines refused to pay
any carbon costs under the new law.
From January 1, all airlines using EU airports fall under
the EU’s Emissions Trading Scheme (ETS), and could be forced to pay fines of
€100 for each tonne of carbon dioxide emitted for which airlines have not
surrendered carbon allowances.
“China opposes the European Union’s unilateral legislation.
China has expressed to the EU our deep concern and opposition many times on a
bilateral level,” Foreign Ministry spokesperson Hong Lei said.
“We hope the EU can take careful precautions with a cautious
and practical attitude, and regarding those aspects involving China,
appropriately discuss and handle this matter,” Hong told reporters during a
The scheme was launched in 2005 as one of the pillars of
Europe’s efforts to combat climate change, and if airlines persistently flout
the law the EU has the option of banning the operator.
Following a December ruling from Europe’s highest court that
inclusion of airlines in the ETS was valid, China’s official Xinhua news agency
warned of a trade war.
Spokesperson Hong said that other countries had taken an
equally negative view of the legislation.
The United States has warned of possible retaliation, while
a draft law in the US Congress proposes to make it illegal to comply with the
Cai Haibo, deputy secretary-general of the China Air
Transport Association (CATA), told Reuters on Wednesday that China would not
cooperate with the EU on the scheme.
“If governments like the US, China and Russia, can launch
strong and forceful retaliatory measures, this will form enormous pressure we
hope could make the EU to turn its head,” he said.
CATA represents the country’s four major airlines:
flag-carrier Air China, China Southern Airlines, China Eastern Airlines and
The association estimates the scheme will cost Chinese
airlines 800 million yuan ($123m) in the first year and more than triple that
Cai said Chinese airlines would consider legal action
against the EU in response to any charges for carbon emissions.
The European Commission has assessed the impact on air fares
at €2 to €12 per passenger. For airlines, the cost is gradual as 85% of carbon
allowances are handed out for free this year and bills would be due only next
year after emissions are calculated.
Kelvin Lau, a Hong Kong-based airlines analyst at Daiwa
Securities, said if Chinese airlines refused to pay the ETS charges it would
have little immediate impact, but that ultimately the EU would not allow China
to just walk away.
“It is still in a negotiation phase and maybe it’s just a
political gesture for Chinese airlines to say they won’t pay - showing that
China strongly opposes the rule,” Lau said.
“But it may not work as this is a law with legislative power
and the EU would not easily let go,” he said.