Transforming the EU economy into the first region of the world as a deterrent to climate change is based on concrete actions and initiatives summarized in the Commission’s Program under the name Green Deal. This program was recently presented by Commission President Von der Leyen in the European Parliament.
The objectives of the Green Deal Program
The objectives of the program and as they were presented are the reduction of atmospheric pollutants by 50%-55% by 2030 with the final objective of obtaining the anticipated climate neutrality by 2050.
In order to achieve this transition, specific measures are needed which will not only ensure their sustainability in terms of the environment, but also in terms of the economy and society respectively, creating growth, new full-time jobs and many business opportunities, etc.
by Thanos S. Chonthrogiannis
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The hidden protectionism and in the deep end trade war
The whole EU project called Green Deal is based on the financial burden caused by polluters operating in the EU and in the rest of the world-international trade. In this way through imposition of the indirect taxes (or duties) that should be paid by the polluting industries, the products that will be produced in the other countries of the world and given that their way of cultivation or production will be polluted the environment will be put off competition and will not be preferred for import into the EU.
Essentially through the planning and implementation of the Green Deal, “taxes” will be imposed (tariffs for non-EU companies) that violate the rules of free trade and free market respectively by creating a protectionist wall for the EU using the objective of protecting the environment.
The President of EU-Commission
Photo by US Air Force Staff Sgt. Jette Carr, Public Domain
Sectors of big investments in the EU for the implementation of the Green Deal
1. Plastic recycling will be enhanced in order to offer more creative options aiming to reduce the timber used in the field of furniture, construction of houses, fishing boats, frames and household items etc.
2. The development of technology for the production, transport and storage of electricity produced by the green energy focusing on the development of battery technology in order to drastically reduce the cost of producing electric cars and public transport, which will pave the way for their mass production in cost frameworks that will be closed near the production costs of today’s conventional cars (please read analysis titled “China’s Comparative Advantage over the US and the EU in Electric-power driven Transport Vehicles”).
3. In addition, investments will take part in the agricultural sector with aim to increase the use of artificial intelligence technology in the primary sector. The aim will be to achieve better quality crops with the minimum use of pesticides (please read analysis titled “The Innovative Technology & the Digitalization Trends in the Agro-food industry”).
As the EU wants to move from the use of coal to produce electricity to green energy, the transition costs are quite high. Because of this, the EU-Commission has chosen the European Investment Bank (EIB) as the main vehicle to finance this Green Deal that is being presented.
In addition, the ECB has proposed proposals-measures which it will implement to further support the environmental protection policies announced in the Green Deal. Such proposals-measures include the purchase of green bonds and always within the framework of the new quantitative easing program to be implemented by the ECB but also changes in the rules governing the types of pawn which an European bank can accept in exchange for the loans it will grant.
The thorns on the Green Deal Implementation Road
1. With an EU budget moving between 1%-1.2% of the EU-27 GDP cannot be financially achieved the green transformation of the EU invoked by the European Commission in Green Deal.
2. Changes in the regulatory framework and taxation will force certain industries to stop them to produce and to lose valuable jobs.
3. Imposition of duties on imported products from abroad produced by polluting production or cultivation methods equally will cause protectionism and may lead to a new trade war with the other countries on the planet.
4. Eastern EU member countries are financially heavily based on the use of lignite for the production of their electricity. The financial sums that will only be required for these areas of the Eastern EU to achieve their green transformation are immense.
The reader who wants to be informed in what way a country can achieve the green transition without losing hundreds of thousands of valuable jobs should read the analysis titled “The Challenges of Climate Change and Global Growth“.
We note, therefore, that in practice the Green Deal of the EU is more like a wish-list, and since its funding suffers in many respects, thus creating only impressions, making most people believe that the Green Deal is likely to stay in place and remain only in the drawers of the EU Commission’s offices.
