The prospect of engaging China in the ICAO global MBM scheme

The International Civil Aviation Association (ICAO) plans to establish a global MBM (market-based measures) scheme for international airlines in 2016. With substantial interests in the aviation and aircraft manufacturing industries, China is an important player in the implementation of the ICAO’s plan. This article argues that the prospect of China’s participation will be shaped by both normative and economic considerations, including state sovereignty, the principle of common but differentiated responsibilities and industrial interests in aviation and aircraft manufacturing. It suggests that among the options considered by the ICAO, China prefers the ‘baseline-and-credit’ approach, which is to decentralize and incorporate energy-efficiency standards. It highlights that the impact of the ICAO’s plan on the international competitiveness of the Chinese aircraft manufacturing industry might concern China in the long term. With the stances of the EU, the US and other major economies taken into account, it concludes by making policy recommendations for the ICAO to help reconcile the discrepancies between China and the other major players.Policy relevanceWhile a general consensus has been reached on the necessity of using MBMs to reduce international aviation emissions, the details of the ICAO’s global MBM scheme are still subject to further negotiations, which with no doubt will be tough. Engaging China is be crucial to the implementation of the ICAO’s plan. By exploring China’s perception of international norms and its economic interests, this article presents an initial attempt to understand China’s preferences and the direction of its future interactions with the ICAO and other major economies.