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A lack of coherence in the European
Union’s trade and climate policies
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A lack of coherence in the European Union’s trade and climate policies
1
This paper was compiled by Alexia Fouarge for Third World Health Aid with the financial support
of the Directorate-General for Development Cooperation and Humanitarian Aid (DGD)
December 2015
1. Introduction
In its latest report, the Intergovernmental Panel on Climate Change (IPCC)1 is clear: “Warming of the climate system is unequivocal [...] The atmosphere and ocean have warmed, the amounts of snow and ice have diminished,
sea level has risen, and the concentrations of greenhouse gases have increased.”
According to the World Health Organisation2, climate change claims 150 000 victims a year worldwide. However,
climate change doesn’t treat populations equally. Countries in the South are more often hit by extreme climate
events than countries in the North. Ninety-five percent of deaths caused by natural disasters occur in poor
countries.
This situation isn’t going to improve in the future. The IPCC3 warns that if there is no drastic reduction in CO2
emissions, low latitude countries will be even more affected by extreme climate events, which will increase
in scale and frequency. Again according to the IPCC4, this means that recent progress to combat hunger will be
reversed: studies estimate that the number of people suffering from malnutrition will have increased by 49 million (11%) in 2050. Between 2030 and 2050, climate change is expected to cause close to 250 000 extra deaths
a year, due to malnutrition, malaria, diarrhoea and heat stress5. It is estimated that there will be 200 million
climate refugees by 20506.
Our governments urgently need to implement actions to reduce our CO2 emissions and stop the destruction of our
environment in order to start the transition process towards a society that is socially and economically sustainable. In this respect, the European Union is endeavouring to position itself on the international scene as a leader
in the fight against climate change7. Following the international climate agreement signed in Paris in December
2015, the president of the European Commission, Jean-Claude Juncker, stated: “Today the world is united in the
fight against climate change. Today the world gets a lifeline, a last chance to hand over to future generations
a world that is more stable, a healthier planet, fairer societies and more prosperous economies. This robust
agreement will steer the world towards a global clean energy transition. This deal is also a success for the
European Union. We have long been the global leader in climate action, and the Paris Agreement now reflects
our ambition worldwide.” 8 However, there are incoherencies in the European Union’s policies. Pressured by the
industrial lobbies, it promotes free trade policies in order to conquer new markets, mainly in countries in the
South in an effort to favour its multinationals’ activities. The latter often have little respect for the environment
and their activities further impact climate change. Furthermore, these free trade policies strengthen the international division of production systems and increase international trade and the dependence of our societies on
fossil fuels, which once again reinforces climate change. It is high time that the European Union was coherent in
its views and policies and gave priority to the interests of populations and the planet rather than multinationals
and profit.
1. IPCC, Climate Change 2013, [online], http://www.climatechange2013.org/images/report/WG1AR5_SPM_brochure_fr.pdf, Consulted on 29 June 2015
2. W
HO, Climate change and its potential impact on health, [online], http://www.who.int/bulletin/volumes/88/3/10-076034/fr/,
Consulted on 10 February 2016
3. IPCC, Climate Change 2014, [online],
http://www.climat.be/fr-be/changements-climatiques/les-rapports-du-giec/2014-impacts-adaptation-et-vulnerabilite/, Consulted on 29 June 2015
4. O
xfam, Risk of reversal in progress on world hunger as climate change threatens food security, [online],
http://www.oxfam.org/sites/www.oxfam.org/files/mb-ipcc-oxfam-analysis-climate-change-food-security-310314-en.pdf, Consulted on 29 June 2015
5. WHO, Climate change and health, [online], http://www.who.int/mediacentre/factsheets/fs266/fr/, Consulted on 29 June 2015
6. http://www.hm-treasury.gov.uk/d/Part_II_Introduction_group.pdf, [online], Consulted on 29 June 2015
7. E
UROPA, Tackling climate change, [online], http://europa.eu/legislation_summaries/environment/tackling_climate_change/index_fr.htm ,
Consulted on 29 June 2015
8. E
UROPEAN COMMISSION, Historic climate deal in Paris: EU leads global efforts, [online], http://ec.europa.eu/news/2015/12/20151212_fr.htm,
Consulted on 8 January 2016
A lack of coherence in the European Union’s trade and climate policies
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2.What
European Union
urgent situation?
is the
about this
doing
2.1 The EU’s climate and environmental ambitions...
The reduction in greenhouse gas emissions is crucial if we are to avoid exceeding the 2°C limit, or even 1.5°C, for
global warming. The measures aimed at combating climate change and reducing greenhouse gas emissions are,
according to its statements, a priority for the countries of the European Union. To achieve this, European leaders
have committed to transforming Europe into a high energy efficient, low carbon economy9.
On 24 October 2014, European decision-makers agreed on the future 2030 climate-energy package aiming to
reduce greenhouse gas emissions by at least 40 % by 2030, compared with 1990. Its goal is also to increase the
share of renewable energy by at least 27 % within the energy mix between now and 2030, and reach an indicative
energy efficiency10 of at least 27 %11. It also plans to reduce its CO2 emissions by 80 % by 2050.
The European Union also signed the first universal and legally binding agreement on the climate in Paris in December 2015. This agreement defines an action plan aimed at keeping global warming below 2°C. According to EU Climate Action and Energy Commissioner Miguel Arias Cañete: “This agreement is a major win for Europe. But more
importantly, it is a major win for the global community. Europe has led the efforts in Paris to get an ambitious
and legally binding global climate deal. [...] The agreement also reconfirms global commitment to continued
support to those in need of assistance. We succeeded. Now, what has been promised must be delivered. Europe
will continue to lead the global low-carbon transition we have agreed.”12
The European Union also intends to support economic growth, social development and the protection of the environment through its trade policy. It believes that coherence and mutual support between these three elements
are key to achieving sustainable development13. Again, it states that, “respect for fundamental workers’ rights
and for environmental protection requirements should be ensured in a context of trade and economic expansion:
the jobs created by open trade shall reflect international core labour standards, and increased trade flows shall
help the rapid spread of green goods, services and technologies around the world and the shift to a low-carbon
economy.”14
For instance, the bilateral trade agreements recently concluded by the European Union contain provisions regarding trade and sustainable development, including, among other things, respect for international environmental
standards and the prudent use of natural resources such as wood and fish, and the promotion of practices favouring sustainable development, such as corporate social responsibility.
9. EUROPEAN
COUNCIL, Tackling climate change in the EU, [online], http://www.consilium.europa.eu/fr/policies/climate-change/,
Consulted on 8 January 2016
10. This means that at least 27 % energy savings must be made.
11. CNCD, C-LIMA-T: Trois dossiers pour la Belgique !, [online], http://www.cncd.be/C-LIMA-T-Trois-dossiers-pour-la, Consulted on 29 June 2015
12. EUROPEAN
COMMISSION, Historic climate deal in Paris: EU leads global efforts, [online], http://ec.europa.eu/news/2015/12/20151212_fr.htm,
Consulted on 8 January 2016
13. EUROPEAN
COMMISSION TRADE , Sustainable Development, [online], http://ec.europa.eu/trade/policy/policy-making/sustainable-development/,
Consulted on 8 January 2016
14. EUROPEAN
COMMISSION TRADE, Sustainable Development, [online], http://ec.europa.eu/trade/policy/policy-making/sustainable-development/,
Consulted on 8 January 2016
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Third World Health Aid | T. 02/209 23 65 | [email protected] | www.twha.be
2.2 ... and their contradictions
Despite the apparent ambition of the Paris agreement, when we take a closer look at it, it won’t succeed in effectively fighting climate change. By ratifying national contributions (INDCs), governments have, in fact, accepted
a level of global warming higher than 3°C. Therefore, we are far from the 1.5 °C limit set in the agreement.
Furthermore, the means to be implemented to reduce CO2 emissions aren’t laid out in the agreement. This opens
the door to the use of false solutions such as carbon storage and sequestration, carbon offsetting and climate
engineering. No mechanism has been clearly defined to facilitate the transfer of technologies to developing countries, in particular to lift the barriers linked to intellectual property rights. According to Claudia Salerno, head
of the Venezuelan delegation at COP21: “The companies who created the climate change problem are also the
ones with the solutions and who want to benefit from them. Capitalism has solutions for capitalism.”15 Finally,
developed countries don’t fulfil their share of responsibility towards developing countries. There isn’t any reference to the historic responsibility of climate change in the agreement.
Moreover, a leaked document presented by the Directorate-General for Energy and Climate Action to the Council’s Trade Policy Committee on 20 November 2015, shows that the EU is against “any explicit reference to trade”
in the climate change agreement, against any reference to intellectual property rights, and promises to “minimise discussions on trade-related issues”16. Hence, trade rules prevail over environmental and climate measures.
Consequently, it is forbidden to touch the principles of free trade, even though they lie at the heart of the current
climate crisis.
3. Free
trade is aggravating climate change
To combat climate change and establish a fair and sustainable society, we need an economic model where the following prevail: respect for the major ecological balances, the relocation of production and consumption systems,
the development of renewable energies and cooperation between citizens to fairly share existing resources. And
yet, the free trade mechanisms promised by the European Union do the exact opposite.
3.1. Destruction of the environment
By concluding free trade agreements, the European Union will not only be allowing its multinationals to increase
their exports by establishing themselves in new markets, but it will also allow the multinationals to move to
countries in the South, where labour is cheap and where the raw materials (wood, ores, land, water, etc.) are
more accessible.
Whether it is a question of deforestation, intensive farming, the depletion of water tables or mining, there are
very few binding rules that prevent the multinationals from massively destroying these resources. For instance,
when the multinational Coca Cola commenced operations in the village of Plachimada in India, the company
began pumping local water supplies at a rate of 1.5 million litres per day and dried up the entire water table17.
Every year, the production of palm oil leads to the deforestation of several million acres of forest. In the Philippines, indigenous populations have been evicted from their ancestral land to allow mining multinationals to set
up their activities there, and thus benefit from the natural resources and pollute the land, air and waterways.
This pillaging of nature and the resulting pollution leads to an increase in CO2 emissions and the aggravation of
climate change.
15. MEDECINE
POUR LE TIERS MONDE, COP21: Le changement se fera par la base, pas lors des COP, [online],
http://m3m.be/news/cop21-le-changement-se-fera-par-la-base-pas-lors-des-cop,
16. CORPORATE
EUROPE OBSERVATORY, Trade trumps climate, [online], Consulted on 8 January 2016
http://corporateeurope.org/climate-and-energy/2015/12/trade-trumps-climate, Consulted on 8 January 2016
17. Rohan
D. Mathews, La lutte de Plachimada contre Coca-Cola, [online],
http://base.d-p-h.info/fr/fiches/dph/fiche-dph-8911.html, Consulted on 29 June 2015
A lack of coherence in the European Union’s trade and climate policies 5
3.2. An outward-looking economy
Free trade policies reinforce the international division of production systems, increase international trade and
the dependence of our societies on fossil fuels. Hence, through international trade, emissions, which are the
fruit of the production of goods and services traded between countries and the intermediate consumption they
require, represent, according to several studies, almost 28 % of global CO2 emissions. In 1990, this figure was only
18 %18. Of course, these CO2 emissions reinforce climate change.
Coal mine
© Stephen Codrington CC BY 2.5
Moreover, by promoting an economy that is completely outward-looking, the European Union remains dependent
on the vagaries of the economy and the climate in other countries. The map below19 shows the EU’s dependence
on food and energy imports, coupled with the risks that these regions run because of climate change.
More than 50 % of the European Union’s energy is imported, making it vulnerable given the current regional
conflicts and future pressures on energy due to climate change. In 2011, it spent EUR 26 billion20 on fossil fuel
subsidies. These subsidies replace those paid to producers and those that reduce the final price for consumers.
There are also the externalities due to the burning of fossil fuels, such as the cost of healthcare to treat patients
suffering from the effects of air pollution. In Europe, these costs amount to EUR 40 billion21. Money it could invest
in the development of sustainable local energy.
The European Union is also the biggest importer of food worldwide, while the regions from which it imports the
food are highly vulnerable to climate change. Drought, storms, monsoons and torrential rain will actually increase
over the next few years, resulting in the destruction of crops and an increase in world food prices. More than
72 % of the European Union’s imports currently come from developing countries and regions vulnerable to climate
change.
18. ATTAC FRANCE, Climat ou TAFTA,[online], https://france.attac.org/nos-publications/notes-et-rapports/article/climat-ou-tafta-il-faut-choisir,
Consulted on 8 January 2016
19. O
XFAM, THE EU’S 2030 ENERGY AND CLIMATE CHANGE PACKAGE, [online],
http://www.oxfam.org/sites/www.oxfam.org/files/ib-eu-2030-energy-climate-change-food-security-030614-en.pdf, Consulted on 29 June 2015
20. E
URACTIV, Why is Oettinger scared of fossil fuel subsidy figures?, [online],
http://www.euractiv.com/energy/oettinger-scared-fossil-fuel-sub-analysis-531291, Consulted on 29 June 2015
21. O
XFAM, The EU’s 2030 Energy and Climate Change Package, [online], http://issuu.com/0xfam/docs/eu-2030-energy-food-security-030614,
Consulted on 29 June 2015
6
Third World Health Aid | T. 02/209 23 65 | [email protected] | www.twha.be
Norway
Russia
USA
nafta
12 %
Algeria
Arabia
Saoudi
asean
11 %
Colombia
Mercosur 22 %
Climate vulnerabilities
Heavy rainfall
Drought
Extreme temperature
Sea-level rise
Developing Africa
Caribbean & Pacific13 %
Top three EU
energy suppliers
Oil
Coal
Gas
Major EU agricultural
suppliers (% total)
Top agricultural imports are:
fruits & nuts, soyabeans, animal feed,
coffee & tea, fats & oils (including
palm oil)
Storms
Instead of developing its economy locally by using methods that respect the environment (renewable energy,
agroecology, etc.), Europe has chosen to invest in false solutions such as fracking22 and supporting an outwardlooking economy which, guided by profit, increases CO2 emissions and negatively influences climate change.
3.3. Arbitration between investor and state
The mechanisms contained within the free trade treaties attempt to weaken the governments’ power as much as
possible and give almost total freedom to multinationals. Governments no longer have the possibility of choosing
what is or isn’t good for our country. The arbitration mechanisms between investors and states (ISDS – InvestorState dispute settlement) which are often included in the free trade agreements, are mechanisms that allow
investors to file a complaint against countries when they take measures that hamper their current or future
profits.
22. Fracking,
or hydraulic fracturing, is the process of drilling and injecting fluid into the ground at high pressure.
This technique is designed to recover gas and oil from dense shale rock, where a classic well wouldn’t produce anything or very little.
A lack of coherence in the European Union’s trade and climate policies 7
These ISDS prevent states from choosing and implementing policies that are in the interest of the planet and the
population. For instance, Argentina was ordered to pay almost EUR 400 million to the multinational Suez because
it broke a contract and renationalised the water supply in Buenos Aires. However, public management has brought
water to 3 million extra inhabitants23.
In El Salvador, communities have succeeded in persuading the government to retract a mining permit for a goldmine which would have seriously damaged the environment. The Canadian company that was going to operate
the mine, took the state to court and demanded compensation of CAD 315 million for the loss of expected future
earnings.
The Swedish energy giant, Vattenfall, also demanded that Germany pay more than EUR 4.7 billion in compensation owing to the country’s decision to phase out nuclear energy24.
Investors’ interests come before those of the environment and democracy.
4. What
are we asking for?
Introducing effective policies and laws to curb climate change on a long-term basis requires, at the very least,
accepting a certain hierarchy in terms of emergencies and legitimacies, and putting the interests of human beings
and the environment before the interests of trade and investors.
4.1. Democratic trade agreements
We demand the transparency of European trade agreements and their inspection, by the population, on a mandatory basis. We no longer want a Europe that is led behind closed doors by a political and economic elite.
The European Commission must make the negotiations it holds, concerning the conclusion of trade agreements,
totally transparent. It is important for civil society to be able to access the contents of the negotiations and give
its opinion on these crucial issues, which can have an impact on public interests.
We are therefore asking for a reinforcement of the population’s participation in these negotiations and their
control of them. It is an essential step towards the democratization of the governance of a Europe under the
influence of lobbies. To achieve this, Europe must adopt structures that allow or facilitate significant civil participation, on a national and European level. First of all, the population should have the right to propose initiatives
to the Parliament, and not just to the Commission25, as is currently the case. Secondly, it is essential to organise
a public debate in the countries concerned before concluding any trade agreement, including the organisation of
mandatory popular referendums on the major treaties and trade agreements such as the TTIP, CETA or TISA. This
public debate would allow social movements and the population to voice their fears and give their opinion on the
negotiated agreement, with full knowledge of the facts.
23. RTBF,
Suez contre l’Argentine : la bataille de l’eau, [online],
https://www.rtbf.be/info/emissions/article_suez-contre-l-argentine-la-bataille-de-l-eau-l-edito-de-robin-cornet?id=8955618,
Consulted on 29 June 2015
24. LE
FIGARO, Vattenfall réclame 4,7 mds EUR à l’Allemagne, [online],
http://www.lefigaro.fr/flash-eco/2014/10/15/97002-20141015FILWWW00280-vattenfall-reclame-47-mds-eur-a-l-allemagne.php,
Consulted on 3 December 2015
25. E
TUDES EUROPEENNES, Pascal Durand: “L’initiative législative ne doit plus relever du libre choix de la seule Commission”, [online],
http://www.etudes-europeennes.eu/actualite-europeenne/pascal-durand-llinitiative-legislative-ne-doit-plus-relever-du-libre-choix-de-la-seulecommissionr.html, Consulted on 29 June 2015
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Demonstration against TTIP in Brussels organized by the platform D19-20
© Alliance D19-20
4.2. Fair, equitable and sustainable agreements
We expect the European Commission to pursue a trade policy that will result in profitable trade relations on both
sides (win-win relations). In this respect, the trade agreements concluded for the European Union, or currently
under negotiation with developing countries, are unjust and unfair agreements, whose outcomes aren’t beneficial
to developing countries. The European Union must take note of the demands of social movements who put the
interests of the people and the environment before those of the market economy.
In this sense, it is crucial for the European Union to respect the sovereignty of every state and its democratically
designated authorities. The European Union must subsequently cease to impose its own norms and standards,
which bear its liberal vision, on its trade partners under the pretext that only full trade liberalisation would lead
to significant and sustainable development. No ISDS clause should be included in the trade agreements between
the EU and these countries. It is important for the EU to allow them to define their best possible path, according
to their particular economic and social situation, since it may not necessarily be free trade.
We would like it to follow the principles that meet the stakes of food sovereignty, the protection of workers,
human rights, natural resources, the fight against climate change, public services, etc.
A lack of coherence in the European Union’s trade and climate policies
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4. 3.Mandatory rules for European multinationals
It isn’t possible to stop the mechanisms of free trade, and the logic of profit above all, from one day to the next.
However, it is possible to begin by imposing certain rules on the activity of multinationals so that they show
greater respect for the environment and nature’s cycles in their activities. That is why we are asking the European Union to implement mandatory laws in order to control the activity of multinationals and set up penalty
mechanisms if the latter don’t respect these laws.
4. 4.Nationalisation of key sectors and sustainable local investment
In order to have control over the key sectors that have a considerable impact on the environment and the climate, we would like the European Union not to prevent its Member States from nationalising sectors such as
water, energy and public transport. We want these sectors to serve the people, not profit certain multinationals.
The trade agreements concluded by the European Union must exclude these sectors from their scope. In general,
public and social sectors (health, education, access to water and energy, etc.), which are fundamental to the
population, must remain in the hands of the public authorities so that they can be accessible to everyone at the
lowest cost. The European Union must stop imposing their liberalisation.
In order to effectively fight climate change and reduce CO2 emissions, we are also asking the European Union to
invest in the development of its local economy by promoting the development of renewable energy, local agriculture, local citizen-based initiatives and local jobs.
It is important that it invests in sustainable alternatives to effectively fight climate change. We want the European Union to leave fossil fuels in the ground. We don’t want a Europe that invests in false solutions (in terms
of health and environmental risks, energy consumption, costs, etc.) such as carbon storage and sequestration,
carbon offsetting, climate engineering or fracking and the exploitation of oil sands promoted in the TTIP and CETA
agreements in negotiation.
5. Conclusion
We have shown that the European Union is incoherent in its discourse and its policies. It must take ambitious
measures in terms of reducing CO2 emissions and tackling climate change. But that is not all. It is the economic
system overall that needs to be changed. To achieve this, it is important to put an end to free trade agreements
as they are currently defined because they don’t serve the interests of populations or the planet, only profit and
the economic elite.
It is high time for social movements fighting climate change and free trade to converge their actions in order to
put pressure on our governments so that they act in favour of populations and the planet, not the multinationals
and their profits. That way, they can set in motion the transition required to effectively fight climate change!
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