The geopolitical consequences of the EU’s green ambitions

As the United Nations Climate Change Conference (COP26) came to a close and resulted in weaker political commitments than expected (or probably as expected if wisdom already comes with younger age), eyes are now turning to China and the United States — of all countries — to lead the way in the fight against climate change. 

The world’s two biggest CO2 emitters pledged to act in a surprise joint declaration on the margin of the climate conference in Glasgow. Both sides recalled their firm commitment to work together to achieve the 1.5C temperature goal set out in the 2015 Paris Agreement and to overall enhance climate action in the 2020s. Among other actions, the two sides intend to cooperate on regulatory frameworks and environmental standards related to reducing emissions of greenhouse gases, to maximize the societal benefits of the clean energy transition and liaise in key areas related to the circular economy, such as green design and renewable resource utilization.

While the Glasgow Climate Pact has already been blasted as business as usual and “blah, blah, blah”, for a European audience the bilateral efforts of the United States and China might sound familiar. They resemble the European Union’s efforts to become the first climate-neutral continent by 2050 — efforts that came to be known as the European Green Deal. With the European Green Deal and the so-called “Fit for 55” legislative package, the EU aims to become the only major economy to reduce greenhouse gas emissions by at least 55 percent by 2030 in a broader attempt to limit global warming. It uses a variety of different objectives across the EU’s economy and society to achieve that broader purpose, including biodiversity, sustainable food systems, sustainable agriculture, clean energy, sustainable industry, sustainable mobility, eliminating pollution and climate action. In doing so, it aims to institutionalize a form of green thinking — one that aims to decouple economic growth from resource use and fosters an inclusive just transition, at least in theory.

However, while the European Green Deal is at its core an effort to transform the European economy, it will also define the EU’s global policy priorities in the decades ahead. As such, the European Green Deal is also a foreign policy tool for the EU with profound geopolitical consequences, both in its immediate neighborhoods and beyond. 

The first stirrings of such transformation emerged in the wake of the most recent update of the EU’s Arctic policy and the proposed aim not to import any Arctic fossil fuels coming from new exploitation. Eventually, the EU also wants to work on a multilateral legal obligation not to allow any further hydrocarbon reserve development in the Arctic or contiguous regions. While the idea of such a proposed moratorium triggered some debate in the Arctic world, the overall question of no more fossil fuels essentially concerns the EU’s global positioning as a leading actor in the fight against climate change, especially in light of the newly found US-China climate friendship. 

As European citizens, grassroots movements, and a small army of environmental lawyers are taking their governments — from France to Norway — to court for failing to implement climate actions, the green shift seems inevitable. Policymakers are slowly realizing that current climate policies might not be enough. More stringent international climate policies are needed. 

For instance, matters of building climate coalitions (so-called “climate clubs”) that combine target carbon pricing and trade sanctions to avoid free-riding are gaining more European attention. Germany’s chancellor Olaf Scholz argued that the EU needs to create a climate club with other countries like the United States, Japan and possibly even China to avoid trade friction linked to green tariffs such as a planned carbon border levy. The basic idea of such a climate club is for countries that are willing to reform to jointly set a faster pace than what has been, for example, adopted and discussed at COP26. In order to protect each other against competitive disadvantages, members are to define a common CO2 price that applies in all participating countries. Imports from third countries should be subject to a climate tariff to prevent free riders and eventually also offer other countries an incentive to join the club. The European Commission has already proposed the introduction of a carbon border adjustment mechanism mirroring the internal EU emission trading system and EU internal climate action, which would account for emissions occurring outside of the EU related to selected imported products and resources.

As climate change disrupts borders, ways of life, food chains, biodiversity and the long-term habitability of many parts of the Global South and Indigenous lands, the EU’s internal environmental commitments to a just transition are more than ever a foreign policy issue. Greenhouse gases reduction, climate mitigation and adaption now need to become key pillars of all industrialized nations’ foreign policy toolbox. 

How do we reach a critical mass of countries needed to make climate initiatives such as climate club successful? Such questions might seem better left to policy wonks in Beijing, Brussels and Washington, but achieving climate justice and fostering transformative change worldwide also require more global and interlinkages cooperation, from high-level diplomacy to grassroots involvement. 

The European Union, backed by the European Green Deal, aims to lead the way toward a more sustainable Earth and, as a result, is positioning itself as the global climate leader. 

Can the United States and China with their newly formed alliance catch up?

Andreas Raspotnik is an Austrian Marshall Plan Fellow at the Wilson Center, Washington DC, and a Senior Research Fellow at the Fridtjof Nansen Institute, Lysaker (Norway). Romain Chuffart is a DurhamARCTIC Ph.D. candidate at Durham Law School, Durham University (United Kingdom), and a Research Associate and Leadership Group member at The Arctic Institute – Center for Circumpolar Security Studies, Washington DC.