Global green investment surge needs new guardrails

GOVERNMENTS around the world are engaged in a race to dominate green technologies – the batteries, wind turbines, heat pumps and more needed to combat climate change. This competition could descend into counterproductive trade wars, or it could accelerate progress toward net-zero emissions.

If world leaders want the latter outcome, they’ll need to establish some ground rules.

In September, the European Commission moved in the wrong direction when it announced an investigation into state subsidies of Chinese electric cars, which have been rapidly gaining market share in Europe. If the probe finds the subsidies to be unfair, it could result in countervailing duties. This would likely prompt retaliation against European manufacturers, some of which are major exporters to China. The upshot would be fewer and more expensive cars, in Beijing and Berlin alike.