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1. Building coalitions for climate transition and nature restoration

Author:
Jean Pisani-Ferry, Beatrice di Mauro, and Jeromin Zettelmeyer
Publication Date:
07-2025
Content Type:
Policy Brief
Institution:
Bruegel
Abstract:
Global climate and biodiversity outcomes will largely be determined in emerging and developing economies (EMDEs). We propose a four-pillar strategy to support climate and nature preservation in line with the economic interests of both developing and advanced countries. This would move beyond voluntary pledges to embed climate and nature objectives into the structures of trade, finance and industrial policy, creating a self-reinforcing system of cooperation and reducing the net costs of the green transition. Under Pillar 1, a coalition of advanced and developing countries would link tiered carbon pricing with a common carbon border adjustment mechanism (CBAM). Pillar 2 would create a climate-finance coalition to decarbonise the power sectors of developing countries. Pillar 3 would involve partnerships to develop clean energy-intensive industrial production stages in developing economies with rich renewables endowments; these would feed into the supply chains of the European Union and other energy-importing advanced economies. Pillar 4 would redesign markets to create scalable and credible mechanisms to fund carbon removals. Technology-based removals can be incentivised through the introduction of clean-up certificates into the EU emissions trading system, while nature-based removals would require improved market design centred on a new asset class: nature shares. The four pillars reinforce each other. A multi-country CBAM and carbon pricing coalition (Pillar 1) would reduce the cost of financing power sector decarbonisation (Pillar 2). Linking EMDE membership of the CBAM and carbon-pricing coalition to financial support for the decarbonisation of power sectors would also make it more attractive for EMDEs to adopt carbon prices. Decarbonisation of power sectors (Pillar 2) would be a precondition for developing clean, highly energy-intensive industry in renewables-rich EMDEs (Pillar 3). The Pillar 1 coalition should include the EU, China and as many other countries as possible. Advanced countries and China could underpin the Pillar 2 financier coalition. Pillar 3 would involve the EU and potentially other energy-poor advanced countries, along with EMDEs that are richly endowed with renewables. Pillar 4 would include the main custodians of the planet’s natural capital. Enabling these coalitions will require EU leadership.
Topic:
Climate Change, Economics, Industrial Policy, Trade, Sustainability, Decarbonization, and Green Transition
Political Geography:
Europe

2. European Election: Red Alert!

Author:
Pascale Joannin
Publication Date:
01-2024
Content Type:
Working Paper
Institution:
Robert Schuman Foundation (RSF)
Abstract:
Europeans are being called to the polls between 6 and 9 June 2024 — depending on the country — to renew the members of the European Parliament. These will be the tenth elections by direct universal suffrage since 1979.
Topic:
Elections, Geopolitics, Economic Growth, Crisis Management, COVID-19, Regional Politics, and Green Transition
Political Geography:
Europe

3. The German 'Schuldenbremse' crisis: a symptom to be taken seriously in Europe

Author:
Clara Bösche
Publication Date:
01-2024
Content Type:
Working Paper
Institution:
Robert Schuman Foundation (RSF)
Abstract:
The priority to be given to the ecological transition and its practical implementation are dividing Germany and Europe. The European Union is being accused of making the conditions of production for farmers even more difficult: the number of demonstrations across the European Union has been rising after the Germans began their protests on 15 January 2024, as they denounced the ambitions of the European Green Deal, as well as the human and financial costs. At the start of 2024, the German coalition government (SPD, Greens and FDP Liberals) led by Chancellor Olaf Scholz (SPD) is struggling, since its draft budget has been cut by around €60 billion. The origins of the budget cuts to which the government has had to resort lie in a decision taken by the Constitutional Court of Karlsruhe dated 15 November 2023. The latter censured the decision to reallocate 60 billion €, initially intended to cushion the economic impact of the pandemic crisis, to a special fund for the transformation of the economy and the climate. For two months now, opposition has been growing in Germany over the resources allocated, the priorities to be defined and the rules governing public debt. The constitutional appeal was lodged by CDU-CSU members of parliament, who denounced the government's "sleight of hand". As Germany enters a recession, the debate is whether or not it is still appropriate to limit public debt to 0.35% of GDP. Current circumstances no longer justify bending the rule: the pandemic crisis is over, and the exceptional funds earmarked should not be used for the economy or the environment. As a result, since the Constitutional Court's ruling against the federal budget, in addition to opposition over the priority to be given to the green transition in economic and agricultural life, further opposition has emerged: regarding whether the constitutional principle of the debt brake (Schuldenbremse) should be reformed or not. This principle is firmly defended by Friedrich Merz, leader of the CDU and of the CDU/CSU in the Bundestag. In his view, the debt brake is the only way to avoid saddling future generations with debt, and he fears that lifting it might have a knock-on effect in terms of the financial stability of other European Union countries. Within the government, the SPD and the Greens (led by the Vice-Chancellor and Minister for the Economy, Robert Habeck), would like to reform the debt brake to facilitate the necessary investments, in line with the European Green Deal. However, within the same government, the FDP Liberals, led by Finance Minister Christian Lindner, have long refused to challenge this constitutional principle, in the same way as the CDU/CSU opposition. Christian Lindner is therefore in a difficult situation, caught between traditional positions, his coalition partners and the opposition. A hard-won agreement on the 2024 budget, on 13 December 2023, provides for cuts that will result, in particular, in the reduction of tax relief on diesel on agricultural machinery - the main focus of demonstrations in Germany – but also in a postponement of the “climate bonus”. Priorities have had to be set because of this cutback, but they are the source of dissatisfaction both on the part of the farmers, as well as the promoters of the European Green Deal. The debate on Germany's levels of debt, in the light of the demonstrations now rocking the country, is further weakening the coalition - the aim in this paper is not to take position on this - but above all, to consider the problem of the priorities to be identified, not only in Germany but also in Europe.
Topic:
Budget, European Union, Tax Systems, and Green Transition
Political Geography:
Europe and Germany

4. The various causes of the agricultural crisis in Europe

Author:
Bernard Bourget
Publication Date:
02-2024
Content Type:
Working Paper
Institution:
Robert Schuman Foundation (RSF)
Abstract:
The farmers' revolt, which peaked in January and February 2024, has affected most EU Member States. It is motivated by rising production costs, foreign competition, falling incomes, environmental constraints and cumbersome administrative procedures. However, certain causes are more specific to certain countries. This is the case in the Netherlands, where the farmers' revolt began in June 2022, in opposition to the Dutch government's plan to reduce nitrogen emissions by cutting livestock numbers. Dutch farmers had taken advantage of the abolition of milk quotas in 2015 to increase their production, making massive use of cattle feed imported from North and South America, and consolidating the Netherlands' position as Europe's leading exporter of food products. This farmers' revolt led to the creation of a party, the "Farmer-Citizen Movement" (BBB), which made a strong entry into the Senate in the March 2023 elections. In the countries of Central Europe - Poland, Slovakia, Hungary and Romania - it was the fall in cereal prices, due to the influx of products imported from Ukraine following the closure of the Black Sea shipping route and the suspension of customs duties in May 2022, that provoked farmers' anger. It even led to the resignation of the Polish Minister of Agriculture in April 2023. In Germany, as in France, it was the governments' plans to reduce tax rebates on agricultural diesel that triggered farmers' protests and led to motorway blockades in January 2024. Farmers' discontent had already made itself felt quietly in France in the autumn with the turning over of road signs at the entrances to rural communities. Other grievances have been added to the increase in taxes on diesel, notably the growing environmental obligations under the Green Deal of the European Union and hostility to the free-trade agreements under negotiation with Mercosur, Australia and New Zealand. The first measures taken or announced by governments and the European Commission helped to calm farmers' anger, but the farm protests then spread to Italy and Spain. In response to the scale of the farmers' protests across Europe, on 25 January the President of the European Commission launched, a Strategic Dialogue on the future of agriculture in the European Union, led by a German academic, Peter Strohschneider, whose conclusions are due before the end of the summer. The conclusions should inform the next Commission and prepare the programming of the Common Agricultural Policy (CAP) after 2027. Themes proposed to participants include farmers' incomes, the sustainability of their practices, technological innovation, and competitiveness. Beyond the immediate measures taken to calm farmers' anger and with a view to analysing its causes, this agricultural crisis needs to be considered in the context of the long-term development of the CAP and European integration.
Topic:
Agriculture, Social Movement, Crisis Management, Carbon Emissions, Farmers, and Green Transition
Political Geography:
Europe

5. Re-energising Europe’s global green reach

Author:
Giovanni Sgaravatti, Simone Tagliapietra, and Cecilia Trasi
Publication Date:
06-2024
Content Type:
Policy Brief
Institution:
Bruegel
Abstract:
The goals of decarbonisation, competitiveness and strategic autonomy will underpin the implementation of the European Green Deal during the 2024-2029 European Union institutional cycle. To strike the right balance between these sometimes conflicting objectives, EU policymakers should focus on both domestic and international aspects of the Green Deal. Domestically, they must ensure implementation of the agreed climate plan, avoiding inaction or delay. Internationally, they must establish a new green-diplomacy and partnerships strategy, which will support global decarbonisation while addressing competitiveness and strategic autonomy concerns. The current EU approach to green diplomacy is uncoordinated, lacking a clear strategy and appropriate resources. Given the EU’s limited share of annual global emissions, supporting decarbonisation abroad is fundamental to meet the global net-zero emissions goal. The EU’s green diplomacy and partnerships need to be strengthened and expanded in a pragmatic and coherent manner. The main priorities include focusing on the implementation of international emissions reduction pledges, a new diplomatic push for carbon pricing and international green taxation, the creation of streamlined partnerships for green industrialisation with major partner countries and the promotion of new global trade and climate agreements. To succeed in these, a revision of the current governance of EU global green action will be required.
Topic:
Climate Change, European Union, Partnerships, Carbon Emissions, and Green Transition
Political Geography:
Europe

6. Assessing the International Interlinkages and Dependencies of the EU27 ‘Energy-renewables’ Ecosystem

Author:
Francesca Guadagno and Robert Stehrer
Publication Date:
05-2024
Content Type:
Working Paper
Institution:
The Vienna Institute for International Economic Studies (WIIW)
Abstract:
The energy-renewables ecosystem (ERES) plays a particularly important role in the green transition. This paper analyses its relevance in EU member states and the competitiveness for the EU27 as a whole vis-à-vis other global players and identifies structural dependencies and vulnerabilities. It does so by drawing on the Joint Research Centre’s FIGARO dataset and detailed trade data, and by developing a novel approach that adapts input-output indicators to the analysis of industrial ecosystems. A number of key findings emerge from our analysis. First, the ERES is particularly relevant in new member states, Austria and Germany. At the global level, the EU27 is the second most important exporter after China. Second, in 2020 the EU ecosystem was dependent on imports of coal and lignite from Russia, as well as on a variety of other products from China (including medium- and high-tech electronic products). Third, analysis on the basis of detailed trade data indicates that a few products in the ERES supply chain are delivered by only a handful of countries, which could indicate some vulnerability. Most of the partner countries supply some products that may be characterised as ‘risky’, but China is a main source of such products.
Topic:
European Union, Trade, Renewable Energy, Strategic Autonomy, Green Transition, and Dependency
Political Geography:
Europe

7. Foreign investments, de-risking and the EU’s green transition: Mining critical minerals in Finland

Author:
Elina Sinkkonen and Marco Siddi
Publication Date:
02-2024
Content Type:
Policy Brief
Institution:
Finnish Institute of International Affairs (FIIA)
Abstract:
The EU is highly dependent on imports of critical and strategic raw materials, both at the extraction and the processing stages. Many of the key supply chains for these materials are dominated by China. In addition, the EU is also dependent on China for many green technologies, such as battery production. The EU’s Critical Raw Materials Act (2023) sets concrete targets for reducing dependencies in the green transition by 2030. Considering both the level of existing dependencies in critical and strategic raw materials and the fact that the Act does not provide any new funding instruments, the feasibility of reaching the set targets is questionable. The Finnish mining sector presents an interesting case that illustrates the scarcity of domestic financing. Most metal ore mines in Finland are owned by foreign companies, and similar trends apply to the refining and recycling of materials. If the EU wishes to mitigate the risks of becoming dependent on authoritarian countries, foreign investments in sectors relevant to the green transition should be subject to investment screening. For example, the Finnish Act on the Screening of Foreign Corporate Acquisitions does not cover greenfield investments such as investments in building battery factories.
Topic:
European Union, Mining, Supply Chains, Green Transition, Raw Materials, Critical Raw Materials (CRM), and De-Risking
Political Geography:
Europe and Finland

8. Critical Minerals and Great Power Competition: An Overview

Author:
Jiayi Zhou and André Månberger
Publication Date:
10-2024
Content Type:
Special Report
Institution:
Stockholm International Peace Research Institute (SIPRI)
Abstract:
With global politics increasingly fractured, states are rushing to secure critical and strategic mineral supply chains. Each state conceptualizes mineral security differently, driven by a mix of imperatives that range from national development and industrial policy to technological and military dominance. Great power competition pervades all of these issue areas, and that competition may also pose risks at the global level: risks for the pace of green transition, risks of geoeconomic escalation and risks of conflict. This report provides an insightful overview of the mineral security policies of four key powers: China, the European Union, Russia and the United States. It describes the distinct ways in which they conceptualize mineral security, comparing their priority lists of critical and strategic minerals. It considers the wider imperatives that motivate their policies and assesses the implications for developing countries. The report concludes by reflecting on the need to mitigate the worst of the resultant risks through expanded dialogue with a wider set of stakeholders. The goal is a form of mineral security that can serve more broad-based, global developmental interests.
Topic:
European Union, Strategic Competition, Green Transition, Critical Minerals, and Great Powers
Political Geography:
Russia, China, Europe, and United States of America

9. Winds of change: The EU’s green agenda after the European Parliament election

Author:
Susi Dennison, Mats Engström, and Carla Hobbs
Publication Date:
05-2024
Content Type:
Policy Brief
Institution:
European Council on Foreign Relations (ECFR)
Abstract:
The next European Commission and Parliament are likely to place security and competitiveness at the centre of their quest for a more geopolitical Europe. With concerns about the costs of the green transition, growing trade tensions between the US and China, and uncertainty surrounding the outcome of the US presidential election and Russia’s war on Ukraine, the EU will probably find it much harder to make further progress on climate action over the next five years. These geopolitical developments – and the way the EU responds to them – will have far-reaching consequences for the EU’s trade and technology decisions, fossil fuel phase-out, and climate diplomacy. The case for climate action remains clear, including its role in European security and competitiveness. In this challenging context, climate progressives will have to deploy compelling narratives, strategic resourcing, and diplomatic engagement to advance the best possible climate agenda during the EU’s next institutional cycle.
Topic:
Climate Change, European Union, Geopolitics, European Parliament, Decarbonization, and Green Transition
Political Geography:
Europe

10. Trust and trade-offs: How to manage Europe’s green technology dependence on China

Author:
Alexander Lipke, Janka Oertel, and Daniel O'Sullivan
Publication Date:
05-2024
Content Type:
Policy Brief
Institution:
European Council on Foreign Relations (ECFR)
Abstract:
“De-risking” is the guiding motif of the EU’s new approach to China, particularly in green technologies where Chinese companies are striving for full dominance. For Europe, these same industries are supposed to generate future prosperity, enable the green transition, and enhance security through greater energy independence. As economic growth, climate goals, and national security cannot all be maximally achieved together in these sectors, European policymakers need to weigh these up and decide which to prioritise, when, and how. Instead of individually using incentives and trade tools ad hoc, at random, and in insufficient doses, member states should revolutionise their approach with: a real push in political leadership, enhanced coordination at the EU level, and clear prioritisation backed up by credible arguments. Policymakers need to define politically where the risks are greatest and what constitutes a tolerable dependency, actively seek partners in the world to preserve competition, and communicate clearly about the necessary trade-offs. A key question for Europeans to ask immediately is whether they trust Chinese companies to form the backbone of Europe’s green transition. The answer will determine the options available to them.
Topic:
Science and Technology, Green Technology, Trust, and Green Transition
Political Geography:
China, Europe, and Asia