How the geopolitics of the EU will change with the Green Deal
The European Green Deal and the energy transition will also have an impact on EU relations with the US, Russia and China. The analysis by Marta Dassù and Roberto Menotti for Aspenia
To be successful, the European Green Deal will require several conditions, starting with the attempt to moderate the costs – for a part of the industrial system and for European citizens – of the energy revolution. Europe's green bet, predicts the International Energy Agency (IEA), will create new levers for growth and employment; but it will certainly not be painless because it will tend to generate, as always with radical economic transformations, winners and losers. Not surprisingly, the legislative package just presented by the European Commission ( “Fit for 55” ) provides for the creation of a new Social Climate Fund. And it will be the subject of a long and difficult negotiation between national governments and with the Strasbourg Parliament.
Alongside the home front there is an international front. The European energy transition will also have a geopolitical impact, shifting EU priorities towards access to those rare minerals and metals on which renewable energy production depends. It will be a gradual process, given the decisive weight that fossil fuels still have in the energy mix of our continent, which is committed to halving polluting emissions by 2035; but the gradual increase in renewable sources is bound to change European energy security. Relations with oil producers will lose weight; the relative importance of the African continent will increase; technological competition with China will intensify; the energy connections will change. Consequently, Europe's energy transition will need to be supported by foreign policy action.
It should be added that Europe certainly cannot think of becoming the world leader in terms of sustainability in total autonomy and only thanks to its virtuous example. Aiming to set international standards is an excellent strategy, even being the first to act; but it is also indispensable – for the environmental bet to be won – that the other main actors in turn adopt similar policies. You can't be a global leader without having followers, or at least willing partners.
There is therefore, on the management of the Green Deal, a decisive link between the European internal dimension and the EU's international projection. Which will also have to think in a geopolitical key, on four fronts in particular.
The first, unavoidable, is the search for an agreement with the United States, as a condition for making credible the European ambition to define new global environmental standards. With the Biden administration, the conditions are much better than in the past, as evidenced by the close consultations already underway. It is not clear, however, what the impact of one of the instruments envisaged by the “Fit for 55” package will be, ie the famous “carbon tax” at the border. By applying a tariff on the carbon content of imported products, the EU aims to protect its producers from unavoidable competitive disadvantages; but thus risks triggering a protectionist spiral.
John Kerry, the US President's special envoy for climate, has expressed concerns over the “border tax” mechanism in recent months, declaring that he wants to be sure that the possible risks are less than the benefits. However, the budget law just presented by the Democrats to Congress includes for the first time a European "carbon tax", which would primarily affect Chinese products. In theory, the two sides of the Atlantic are getting closer, creating pressure on the most polluting large economies; in fact, the introduction of such a measure remains problematic and may instead complicate global agreements on climate policies.
The second front is Russia: we start from a situation of strong "interdependence" from Russian gas, especially for Germany and Italy among the major European economies, and in reality until 2030 things will not change much in terms of supplies and needs. Natural gas will still be one of the necessary sources of the energy transition, as Minister Roberto Cingolani explains in an interview with Aspenia. But the future will not be easy for Russia and the other "rentier" states, with economies almost entirely entrusted to oil and gas production. And geography won't change as a result of the green transition. A Russian neighbor deprived of his greatest source of income (and power) will need to be handled with particular care.
Thirdly, there is a Mediterranean and African side for sustainability policies. Europe and Africa are potentially complementary in many key sectors: it would be logical to make a real effort on the European side, which for now is seen too little, to develop renewable energy on the other side of the Mediterranean. An effort that obviously requires huge investments, as well as ad hoc agreements with partners to be selected based on the geographical location, the supply of strategic raw materials, and the availability of physical space for the installation of photovoltaic or wind power plants.
The fourth front, but certainly not in order of importance, concerns China, which is now by far the world's largest producer of polluting emissions. As is evident, actively involving China (and India, the world's third largest producer of emissions) in environmental policies is indispensable. China also has a lot to do with the new dimension of energy security: with the possession or control of rare earths and sensitive materials for renewable energy. If the energy transition becomes, as it is partly happening, a pure element of economic, technological and geopolitical competition, the environmental challenge will be lost.
In conclusion, Europe needs a real foreign policy to successfully manage the Green Deal. Tackling internal challenges will require pragmatism and flexibility; managing external ones will require geopolitical vision and a good dose of diplomatic creativity.
(Extract from an article published on Aspenia online ; here the full version)
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/mondo/green-deal-politica-internazionale/ on Sun, 25 Jul 2021 06:05:47 +0000.