Climate breakdown shows need for new EU environmental strategy

20/12/2009

 

After the failure in Copenhagen, many must consider what went wrong. Europe needs to rethink its international environmental strategy.

The European Union can look back at a number of green success stories. Working together with developing nations, Europe played an important role at the Rio Conference in 1992, for the Kyoto Protocol in 1997 and for progress in other fields, such as control of dangerous waste under the Basel Convention and the Biosafety Protocol under the Convention on Biodiversity.

But in Copenhagen, European leaders were sidelined by the US, China, India, Brazil and South Africa. When the deal between Barack Obama and the emerging economies was done, the European Union faced the choice either to agree or to be accused of stopping an agreement in Copenhagen. The press conference where José Manuel Barroso and Fredrik Reinfeldt were going to present the European view was delayed for more than two hours – a sign that discussions among EU Heads of Government were not easy.

José Manuel Barroso and Fredrik Reinfeldt at the Climate Summit. Photo: Gunnar Seijbold/Government Offices

Already before EU co-ordination started, Nicolas Sarkozy said that the deal was done. Once again, the big EU countries acted on their own, making the role of the rotating Presidency difficult.

The Swedish Presidency´s disappointment over the Copenhagen Summit was obvious.

Major fiasco, complete mess, totally inadequate, massive disappointment are words that spring to mind twittered Gunnar Caperius, adviser to the Minister for Environment.

The Minister himself, Andreas Carlgren, wrote on his blog under the title `Disappointed over the Copenhagen outcome´: What happened at the climate conference is really not what I and the EU have worked so incredibly hard for…Yesterday the USA, China, India, Brazil and South Africa made a deal on their own.

Of course, the responsibility rests with many players, mainly the US and China. But the Swedish EU Presidency was too weak, with clear divisions between Andreas Carlgren and Prime Minister Fredrik Reinfeldt.

What lesson can the European Union learn from the climate fiasco?

First, the world has changed. China is flexing its economic muscles more than before. India, Indonesia, Brazil and South Africa are taking a self-confident role on the global scene. The European Union must have a more coherent foreign policy in relations to such countries, not allowing them to divide Member States (as Russia has done on energy policy).

Second, Europe must build stronger alliances with poor countries. During the climate negotiations, Sweden as EU Chair categorically refused to discuss new commitments under the Kyoto Protocol. This attitude provoked many developing countries, and in the end the European Union had to revise its position. Now, EU leaders, and the new High Representative Catherine Ashton, must find ways to increase trust among the poor countries.

Third, environment cannot any longer be seen isolated from trade and development policy. The refusal by China and India to move forward on binding climate commitments will certainly increase calls for border tax adjustments and other restrictive trade measures. That is a dangerous route.

The EU should instead use the review of the Common Agricultural Policy and the negotiations on the next long-term budget to reduce trade barriers and subsidies, and use this leverage to convince major partners to move forward on climate.


A Green World Power – But For How Long?

06/12/2009

 

Finally, the Copenhagen Climate Summit starts. Reaching an agreement at the conference is `a very big and important task´ for the Swedish EU Presidency, Fredrik Reinfeldt stated in July. Now it is clear that Copenhagen will not produce a binding agreement, a setback for Reinfeldt´s ambitions.

Without doubt, the European Union has played a leading role in global climate negotiations, saving the Kyoto Protocol and setting the most ambitious emission targets among major economies.

European leverage in Copenhagen depends on how governments solve outstanding issues. There is still no bid from the EU on financial aid to developing countries, although Reinfeldt claimed so after the European Council in October. Sweden is now trying to get pledges from as many EU governments as possible.

Green Ministers. Denmark´s Connie Hedegaard and Sweden´s Andreas Carlgren.  Photo: Gunnar Seijbold/Government Offices

Green Ministers. Denmark´s Connie Hedegaard and Sweden´s Andreas Carlgren. Photo: Gunnar Seijbold/Government Offices

Financial aid has to be additional to earlier promises if Copenhagen is to be a success. Developing countries will not be convinced if the money comes from existing development aid budgets. The European Council on Thursday and Friday has to come up with a substantial offer.

Fredrik Reinfeldt must also have the guts to say no to Barack Obama if the US position is too weak. It would be a serious mistake to abandon the Kyoto Protocol without a better binding agreement in place.

In Copenhagen, the European Union will be in the lead. But in five years, the picture might have changed. The new government in Japan has already presented an ambitious climate target. China is moving fast forward, for example on green technologies. The same goes for South Korea and other emerging economies. With Barack Obama as President, the United States can regain the leading role in environmental policy the country had during the 1970s and 1980s.

Europe could quickly lose its pole position if there is not enough progress on new environmental measures. Unfortunately, there has been a slowing down in green policy-making during the last few years, with industry concerns over short-term competitiveness growing more influential.

The new Commission will have a key role in securing that Europe does not fall behind. Connie Hedegaard is a good choice as climate commissioner, but it is also crucial that the new climate directorate has a strong leadership. The ambitious climate targets agreed must be followed by concrete measures to preserve Europe´s credibility.

Other environmental issues are equally important. It will not be possible to find long-term solutions to climate change without adressing the loss of biodiversity. Resource and energy efficiency will climb even higher on the political agenda when conflicts over scarce resources grow stronger.

Thus, Jan Potocnik´s portfolio is as important as Connie Hedegard. The European Parliament should put tough questions to Potocnik on the agenda for the coming years.

The new high representative, Catherine Ashton, also has a key role. The European External Actions Service should have a strong green component.

Being a green world power is an advantage for the European Union, giving credibility both in the world and among its own citizens. The Copenhagen Summit will be a test for European diplomacy and for the Swedish Presidency. However, ambitious Commission proposals on environment during the next few years could be even more important for Europe´s role on the global stage.

Others on the Swedish EU Presidency: DN, Jean QuatremerTony BarberGrahnlawse2009.eu


Russia – a Challenge for the High Representative

15/11/2009

 

Wednesday´s EU-Russia Summit will be the last major foreign policy event under the Nice Treaty. On 1 December, the new President of the Council and the new High Representative will assume their posts. Russia will be one of their main challenges.

Sweden will continue to chair Council meetings until the end of its Presidency, in accordance with conclusions from the EU Summit in December 2008. But that doesn´t mean that the two new top politicians will keep silent. They will surely have a role at the European Council 10-11 December, perhaps appearing at a joint press conference with Reinfeldt and Barroso. The real turf wars will be during the Spanish Presidency. Zapatero will not give away Spain´s six months in the spotlights so easily.

On Wednesday in Stockholm, however, Reinfeldt will run the show together with José Manuel Barroso and Javier Solana. Discussions with Russian President Dmitrij Medvedev in the `Hall of Mirrors´ at Grand Hôtel are likely to focus on climate change, energy security and trade issues. How human rights issues will be brought up is a subject for EU Foreign Ministers´ meeting tomorrow.

Relations to Russia have been difficult for every Presidency to handle. Sweden has done better than most. The Foreign Ministry did a lot behind the scenes to avoid a new Georgia conflict this summer.

True, there is anger in Moscow over Carl Bildt´s outspoken comments on the war in Georgia, and Sweden´s statements on murders of human rights activists. It took a long time for Russia to confirm the date and place for the EU-Russia Summit. But that kind of tensions is better than treating the Kremlin with silk gloves.

Of course, the EU needs Russia, not least for its energy resources. It is perhaps no coincidence that the gas pipelines Nordstream and Southstream were approved by EU Member States just before the Summit. But Russia is also dependent on the EU as its main trading partner.

During Foreign Ministers´discussions tomorrow, there will be hardliners (many from Eastern Europe) and softies (including Germany and Italy). Of course, the European Union needs a constructive dialogue with Russia. In my view, however, it would be a sign of weakness if the EU did not dare to speak up about killings of human rights activists and journalists at the meeting with Medvedev.  The same is true for the rigged regional elections and the continued human rights abuses in Chechnya.

Hopefully, Medvedev will not repeat Putin´s aggressive appearance in Stockholm 2001. Then, Putin chocked the press and his host Göran Persson by saying `If the Albanian UCK-terrorists cannot be disarmed they must be eliminated´. Putin continued: `In Macedonia, we are presently experiencing the same thing as we have experienced in Chechnya´. Fortunately, the EU used its diplomatic skills to solve the conflict in Macedonia, not the brutal strategy of the Kremlin in the Caucasus.

But even if Medvedev is more soft-spoken than Putin, that does not mean that the politics of the Kremlin has changed much, whether it comes to Chechnya or to human rights in general.

Promoting democracy and freedom of the media in Russia is a strategic task for the new EU High Representative, to be appointed on Thursday. If too little is done, the Russian model will corrupt state power also in parts of the European Union. Look at Italy.

One key to success might be to frame this work in a modern strategy for democratization and media pluralism, to be applied in all EU external relations. Anna Lindh brought up this issue during the Swedish Presidency in 2001. It might be something for the new High Representative to consider.

Others about the Swedish Presidency, EU-Russia meeting: DN, DN2, DN3, EUObserver, Jean Quatremer, Jon Worth, Le Taurillon, SvD, SvD2, SvD3, Tony Barber


Failure on Climate Financing

02/11/2009

 

Read the conclusions, do not trust press conferences. That is good advice when it comes to understanding political decisions – in the EU as well as in domestic policy.

José Manuel Barroso and Fredrik Reinfeldt claimed success on climate after the European Council. `The difficult question of “climate financing” has been resolved and the EU’s climate package is thus complete.´, the Swedish Presidency states on its website.

The text gives another impression. Fredrik Reinfeldt had to weaken key paragraphs considerably. As a result, there is no clear commitment from the EU on financing in the run-up to Copenhagen. This will complicate tomorrow´s talks with Barack Obama, as well as negotiations with other major emitters.

The European Council agreed on the overall amount needed for 2020, including private financing through emission trading and other means. But more importantly, there was no decision on the short-term financing, crucial for a political agreement in Copenhagen.

Before the EU Summit, Sweden had proposed the following wording:

`The European Council appreciates the Commission´s estimate of an overall financing need of EUR 5-7 billion per year for the first three years following an ambitious agreement in Copenhagen and underlines that the EU in this context is ready to contribute its fair share of these costs´

This text met strong resistance from Germany, Poland and others. As a result, there was no agreement on the financing need, in contrast to what the Swedish Presidency claims on its website. The paragraph in the final conclusions is:

`Taking note of the Commission estimate that a global financing of EUR 5-7 billion per year for the first three years is needed following an ambitious agreement in Copenhagen, the European Council underlines that a figure will be determined in the light of the outcome of the Copenhagen conference.´

Der Spiegel is right in describing the outcome as a success for Angela Merkel, who did not want concrete figures decided at the Summit. The Guardian, among others, gives a good overview of the failure to reach agreement on financial commitments.

There was also no agreement on the controversial issue of `hot air´, emission allowances in the Kyoto protocol not used by countries.

What does this mean for Copenhagen?

Fredrik Reinfeldt´s adviser for climate, Lars-Erik Liljelund, rules out a legally binding agreement. `It was somewhat stupid to make Copenhagen a bigger event than it is´, he says to Swedish newspaper Svenska Dagbladet.

How wise is it then to abandon the Kyoto protocol (which does not end in 2013) without securing an alternative?

 

Briefly on other issues at the European Council:

Fredrik Reinfeldt was more successful on institutional issues. The Lisbon Treaty is almost in place, a significant achievement by the Presidency. Another positive result is the progress on guidelines for the External Action Service.

On migration, the Summit agreed wording supporting tough border controls, but did not specifically mention the Geneva convention in a significant step away from earlier EU commitments.

The Baltic Sea Strategy was endorsed, a vague, non-committal document.

If the final hurdles for the Lisbon Treaty are cleared, there will soon be a decision on the new posts. However, dark clouds still loom over the climate negotiations in Copenhagen.


Climate Financing: The 50 Billion-Euro Question

25/10/2009

 

Words can be explosive. Especially if they imply that billions of euro will be transferred from state coffers.

So it should not come as a big surprise that the Swedish government has difficulties in finding agreement on the financing of climate adaptation measures in developing countries. EU Finance Ministers fought about the issue last Tuesday. Now, climate financing is likely to dominate the European Council on Thursday and Friday (together with discussions on the top posts in the Lisbon Treaty).

The draft conclusions for the Summit (prepared for the COREPER meeting last Wednesday) mentions both short-term and long-term costs. Two key sentences illustrate the stakes involved:

 “The European Council appreciates the Commission´s estimate of an overall financing need of EUR 5-7 billion per year for the first three years following an ambitious agreement in Copenhagen and underlines that the EU in this context is ready to contribute its fair share of these costs”

 “The European Council considers that the overall level of the international public support required could lie in the range of EUR 22 to 50 billion per year by 2020, subject to a fair burden sharing at the global level in line with the distribution key agreed by Parties…”

Poland is refusing to agree on concrete numbers without promises that the burden sharing will to a large extent be based on GDP, not only on carbon emissions. Negotiations are further complicated by the fact that Germany is forming a new government.

Billion Euro Baby: Finance Minister Anders Borg is keeping a firm grip on climate negotiations. Photo: Pawel Flato/Government offices

Billion Euro Baby: Finance Minister Anders Borg is keeping a firm grip on climate negotiations. Photo: Pawel Flato/Government offices

Thus, the conclusions are likely to be watered down. That may come at a high price. Climate negotiations are already in crisis, with a close adviser to Fredrik Reinfeldt ruling out a legally binding agreement in Copenhagen. If the EU Summit does not mention ambitious figures on climate financing, it will be even more difficult to achieve a political deal in December that is strong enough.

There are a number of other open issues. What should happen to the `hot air´, the emission allowances not used by countries primarily in Eastern Europe? How will the new system of flexible mechanisms work in practice and how will it be controlled? What criteria should apply for the distribution of financial support to developing counties? Will climate financing be additional to current development assistance?

Agreement at the European Council is further complicated by internal conflicts in the Swedish government. `I hope the rumour is true, that Anders Borg is running the government´, former Finance Minister Pär Nuder said at a seminar about the Government Offices last week. But when it comes to conducting the EU Presidency, a strong Finance Ministry is not always a good idea.

Regarding climate, Finance Minister Anders Borg seems to lack the diplomatic skills needed to find agreement among 27 Member States. Dogmatic instructions from Stockholm are making things difficult in Brussels. Unfortunately, the Prime Minister´s office is weaker this time than in 2001, when State Secretary Lars Danielsson was able to give negotiators clear guidance.

Agreement on climate change in Copenhagen is the Swedish government´s first priority for the EU Presidency. It would have been easier to achieve if Fredrik Reinfeldt had been more active from the start. Instead, the Swedish Prime Minister already in December last year stated that it would be difficult to agree new commitments for emission reductions by developed countries. The government negotiators are accused of trying to accommodate every divergent view instead of showing leadership in the way former chief negotiator Bo Kjellén did. In the important area of `policies and measures´, Sweden has not put forward any innovative proposals.

Some of the criticism might be unjustified. The task is difficult. However, the government has made a number of strategic mistakes. Fredrik Reinfeldt might have to pay a high political price for the lack of a strong agreement in Copenhagen.

Note: The excellent Arte blog on Europe also highlights climate and the Swedish EU Presidency.


A decisive week for Latvia

11/10/2009

 

`Let´s hope for the miracle save´

That was the response from a high-level official at the Swedish Central Bank in December 2008 when former IMF senior economist Torbjörn Becker questioned the policy towards Latvia. The comment was made public last week, when the Supreme Administrative Court gave me access to some of the official Swedish documents regarding Latvia´s economy.

Not as friendly as it seems. Swedish Prime Minister Fredrik Reinfeldt and Latvian Prime Minister Valdis Dombrovkis. Photo: Gunnar Seijbold/Swedish Government Offices

Not as friendly as it seems. Swedish Prime Minister Fredrik Reinfeldt and Latvian Prime Minister Valdis Dombrovkis. Photo: Gunnar Seijbold/Swedish Government Offices

Torbjörn Becker, Director of the Stockholm Institute of Transition Economics, had sent an e-mail first to Christoph Rosenberg at the IMF, then to the Swedish Central Bank (Riksbanken). In his e-mail, Becker criticized the painful defense of Latvia´s fixed exchange rate with argument he and others have later used in the public debate (although with somewhat more diplomatic language):

`It seems that (the IMF statement on Latvia) mostly is a way of defending the honour of their politicians and central bank, as well as protecting the Swedish banks, when nothing is done about the currency in a situation when every normal person understands that an overvalued currency does not help the necessary adjustment of the current account balance. Now they will instead get a meltdown of the real economy, if there is not a miracle save of the world economy´ (my translation).

No one seems to have listened. The laconical response was: `Let´s hope for the miracle save´.

Swedish Finance Minister Anders Borg had already decided to support the Latvian government´s efforts to preserve the exchange rate of the currency, lats. According to several sources, one reason was the heavy losses Swedish banks would suffer if there was a devaluation in Latvia (although Anders Borg denies this).

The rescue package put together almost a year ago is now close to failure. Developments next week will be crucial.

Tomorrow, the Latvian government is supposed to agree further reinforcements of the budget with 175 million lats. At the latest ECOFIN meeting, Anders Borg threatened Latvia with serious consequences unless the budget target was achieved. After some friction between the Latvian and Swedish government, the aim is now to have a budget decision ready when EU Commissioner Joaquín Almunia visits Riga on Tuesday.

Whether all parties in government can agree to further budget cuts and a property tax remains to be seen. Drastic reductions of social welfare and public salaries are already taking a heavy toll. Latvian Prime Minister Valdis Dombrovskis is right in saying that further budget cuts would hurt the economic recovery and increase social unrest.

Still, Latvia will be forced to close even more schools and hospitals, because of the rigid policy of the EU and the IMF.

I have written extensively earlier about Sweden and the crisis in Latvia, and many others (including the Financial Times) have criticized the approach by international lenders.

The question now is whether the Swedish EU Presidency will continue along a path that could led to economic collapse in Latvia and dangerous political instability in a strategic part of the European Union.

Do all EU governments believe in miracles or is there still some strategic thinking left?


The crisis is not over

04/10/2009

 

A feeling of relief was evident among EU policy-makers when the result of the Irish referendum was made public yesterday. The revised Lisbon Treaty had cleared the most significant hurdle.

Everybody is now looking at the Czech Republic, wondering what the next step of Vaclav Klaus will be. Fredrik Reinfeldt will meet his Czech counterpart on Wednesday, at the same time as Cecilia Malmström visits Prague.

The signature of Vaclav Klaus is crucial for the institutional development of the EU. Hoever, there is a risk is that an even more fundamental problem is forgotten. The gap between citizens and EU institutions still remains.

It has taken seven years to get this far with institutional reform – and it will not be enough if the EU is really going to play a strong role on the international scene. More urgently, hard decisions on climate change, reform of the common agricultural policy and enlargement will be difficult to take as long as citizens do not feel connected to policy-making in Brussels.

That is why Margot Wallström´s communication portfolio in the present Commission has been so important.

Critics are partly right. Progress has not been quick enough and there is a tendency (more by Barroso than by Wallström) to reduce communication to PR. The task was never going to be easy.

That does not mean that the basic idea was wrong. On the contrary, opening up EU institutions and creating a `democratic infrastructure´ should be an even more important task for the next Commission.

Margot Wallström has been successful in a number of areas. Interactive communication on the Internet, Citizens´summaries for new proposals, EU Youth Summit, European citizens´ consultations.

However, other developments in the EU have not been as encouraging.

The Commission proposal for a revised regulation on access to documents has been critized for not going far enough, even weakening some of the current provisions.

Although a voluntary register for lobbyists has been established, many remain outside the system. EU regulations on lobbyism still lags far behind the US, where Barack Obama has recently established even more stringent rules.

The Council of Ministers is still lacking in transparency, to some extent because openness has never been Javier Solana´s favorite theme. Sometimes, statements from the Council are politically insensitive and further decrease the trust in EU institutions. ECOFIN´s threat to Latvia this week is one such example.

Even if Lisbon is finally approved, the fundamental crisis of confidence remains. The next Commission should build on the new Treaty and move quickly to implement the articles on citizens´ intiatives and on civil society.

Barroso should appoint a new Commissioner with a stronger mandate to improve transparency and consultation with citizens, and to strenghtening pan-European civil society.

Relaxing is not the right answer to ratification of the Lisbon Treaty.