European Green Deal beyond Europe’s Borders?
The EU’s Green Deal negotiators are getting closer to the final accord, which will lay out the legal foundation. So, with the process moving along, it’s time to look at the Agreement from a more holistic perspective. What are the repercussions of the EU Green Deal for developing countries and the global efforts against climate change?
When discussing the EU Green Deal, the domestic dimension is often the focus. This flagship initiative is putting Europe on track to climate neutrality by 2050. One key issue is the change towards renewables in the domestic energy system. However, the external dimension, the EU Green Deal beyond Europe’s borders, is often forgotten. So, we are here to give you a brief introduction!
Why is the European Green Deal Geopolitical?
You may now think: ‘it is a European initiative; with domestic goals, why does it matter globally?’ Well, consider aspects such as the disappearance of oil and gas from European markets. This affects countries globally and has significant impacts on producing economies. These are amongst others located in the Global South. On the other hand, the planned green energy innovations require new imports of raw materials, which includes negotiations with other producing areas.
Furthermore, the goal of the Green Deal is, obviously, to contribute to the overall reduction of emissions. To fight climate change, if you will. Europe, however, emits only 10% of global GHG emissions. So, just sticking to Europe won’t be enough to tackle the climate crisis.
Good old Paris Agreement
Development policy can be a valuable tool when it comes to promoting sustainable development. The EU, its institutions, and the European investment bank can organize development assistance around sustainability globally. And frankly, with the 30% of the general budget directed at climate finance, they certainly are.
The Paris Agreement includes the principle of common but differentiated responsibilities. This acknowledges the difference between countries in capabilities and responsibilities in terms of addressing climate change. The Global North committed to climate finance to foster clean energy and sustainability projects in the Global South. And the EU Green Deal beyond Europe’s borders is trying to address these climate partnerships.
Global green energy transition
The European Union aims to also make the European Green Deal a roadmap to a green recovery from COVID. To facilitate this, we must reach climate partnerships. These revolve around three primary policy foci: sustainable energy, system development and climate resilience. As we discussed in one of our older articles,energy can be fundamental in providing opportunities, inclusive growth, and job creation. The EU is now trying to support underserved areas in their green electrification efforts.
Follow the money
There is a financial instrument called the Neighbourhood, Development and International Cooperation Instrument(NDICI). It supports the EU’s external actions, and 79.5 billion euros have been allocated to it for the next seven years.
Overall, this investment also means that the EU will seize to finance non-sustainable activities (i.e. fossil fuels). As such, there is a “phasing out” of finance for coal, gas, oil and the like. This phasing out period goes hand in hand with the “just transition mechanism” and the “leaving no one behind” principle. These ensure that the EU supports partners, with financial and technical assistance, in their shift to renewable energy.
Africa vs Europe clashing priorities?
However, the EU Green Deal focuses more on climate mitigation than climate adaptation. This is not great news for developing countries that don’t emit much but are disproportionately affected by the adverse effects of climate change. After all, developing countries activities are only responsible for a small share of global GHG emissions. Africa, for instance, is only responsible for 2-3 % of GHG emissions worldwide. Mitigation is clearly not a priority for Africa that faces endemic poverty, hardships, and poor living conditions. Economic diversification is another essential aspect for Africa.
However, there are opportunities in the EU Green Deal beyond Europe’s borders. Some countries such as Chile are investing in “green hydrogen” as they view it as a good investment opportunity in the changing markets.
Post-Cotonou
To reach beyond Europe with the Green Deal, the EU needs to engage with partners meaningfully. One communication channel is the Post-Cotonou negotiation. The Cotonou Agreement was born in 2000 between the European Union (EU) and the Organisation of African, Caribbean and Pacific States (OACPS). Formerly the OACPS was the African, Caribbean and Pacific Group of States (ACP).
The Cotonou agreement’s primary objective is poverty reduction, and it centres around three pillars: Development Cooperation, Trade, and Political Dimensions. The states agreed on the new Post- Cotonou Agreement this year, supplementing the agenda of poverty reduction with climate protection, human rights, migration, and other factors. The Agreement has been reached in 2021; however, it is yet to be signed and ratified. It will be named after the city where the respective states will sign it. Once we know, we can finally stop referring to it as Post-Cotonou.
Why does Cotonou matter for the Green Deal? Well, it is a significant move away from donor-recipient relations and their inherent power dynamics. Instead, it is an attempt at a political dialogueframework, especially in terms of the African Union – European Union relationship.
EU green deal beyond Europe’s borders & Confusing Fragmentation
The Green Deal could also address another critical issue. The fragmentation of initiatives in the climate sector. The confusion of who is doing what is not helpful for fruitful decarbonization projects. Similarly, the EU should address some overlaps and inefficiencies. One proposed solution to tackle both the wish to extend the Green Deal beyond its borders and the fragmentation problem is to create a single sustainable development finance entity to coordinate the climate initiatives of the EU. This suggestion stems from a group at the European Financial Architecture for Development. They suggest a European Climate and Sustainable Development Bank as the external investment arm of the European Green Deal.
Conclusion
The European Green Deal and its new priorities will not leave the development sector untouched. Firstly, a rethinking towards adaptation would be helpful to make climate finance coherent with partner countries’ priorities. Secondly, keeping the basics of successful initiatives and partnerships in mind will be crucial. This means: go bottom-up, make the deal inclusive and equitable and ensure local acceptance. Lastly, it needs to be less confusing and less fragmented. One potential solution being the suggested external investment arm of the European Green Deal.
