Partners or Rivals? EU and China’s Competing Models of Climate Finance in the Green Climate Fund

This paper examines the dual role of the European Union (EU) and China as both partners and rivals in the Green Climate Fund (GCF), asking when they cooperate, when they compete, and what is at stake in their engagement. While both actors present themselves as global climate leaders, their approaches to climate finance diverge sharply. The EU promotes a financialised model centred on public-private partnerships, de-risking instruments, and fiduciary safeguards, while China relies more heavily on state-owned enterprises, policy banks, and sovereign wealth funds to expand its green industrial footprint. These differences underpin three dimensions of rivalry: normative competition over governance standards and accountability; economic rivalry over markets, contracts, and technological dominance in renewable energy and electric vehicles; and geopolitical rivalry over legitimacy and influence in the Global South. Yet despite these tensions, the EU and China also act as strategic partners: defending multilateral climate finance against US obstructionism, legitimising the Paris Agreement, and fostering green industrialisation in developing countries. Drawing on GCF board debates, financing instruments, and project portfolios, the paper maps the conditions under which the EU and China act as allies or competitors, and demonstrates how the GCF has become a site of both contestation and cooperation in global climate governance.