COVID-19 and green ambitions: navigating the mist towards carbon-neutrality - Hanover Communications

Hanover

17 Apr 2020

For the last 18 months, climate and the environment dominated many of the policy discussions at national and EU level. The sense of urgency for climate action has (temporarily) faded due to a more immediate concern: COVID-19. A massive global health crisis, likely leading to a global economic depression. It will take years to recover and rebuild the economy. However, without wanting to make light of any loss or challenge, like every crisis, this one also creates opportunities. If we manage to align our economic and environmental interests – as the European Green Deal already set out to do last December – the current crisis may be a further push to a more sustainable pathway.

The European Green Deal is the EU’s green growth strategy that should lead the continent towards carbon-neutrality by 2050. The Green Deal is a comprehensive strategy of initiatives and measures, addressing among others sustainable finance, circular economy, mobility, energy, biodiversity, agriculture etc. As many of these initiatives impact one another, the strategy sets out a myriad of actions for the coming years – the coming 5 to 10 years are crucial to get us on track for the 2050 goals. An economic recession or even depression urges the question: what is feasible? Are these ambitions still realistic?

In a webinar roundtable organised by Hanover with Diederik Samsom, Head of Cabinet of Commission Vice-President Timmermans, on COVID-19 and the Green Deal, both Mr Samsom and participants agreed that we should not lower our climate and sustainability ambitions in light of the Corona-crisis. If anything, ambitions should be increased (at least maintained) due to an acceleration of certain work streams or investments. As a green growth strategy, the Green Deal should be reflected in our recovery plans. However, the major challenges for a green recovery cannot be ignored:

  • firstly, financing – both recapitalisation of companies (with or without smart conditionality) and investment into new sustainable industries/technologies, in particular at a time where private investors may also have suffered the financial consequences;
  • secondly, timing – there is little time to develop the recovery plan, but what technologies are sufficiently mature to deliver what is expected from them, can they already replace ‘traditional’ industries in the short term, what conditions can be coupled to support those traditional industries?
  • thirdly, political will for coordination and collaboration – any plan can only work when the political back-up is there. Different member states are suffering different impacts and have different needs. Existing infrastructure, different geographies, and societal culture are just a few elements which influence national positions and investment needs. For the recovery plan to work, there needs to be gains for everyone involved.

What these elements highlight is that any recovery plan, as aligned with the Green Deal, needs to be realistic, yet ambitious. The time is now to take decisive action and make concrete investment plans for areas with obvious needs, such as renovation, uptake of the circular economy across sectors, charging infrastructure, long-haul trains. Leverage the opportunities of the digital transformation in these processes. At the same time, one cannot forget the human dimension of (accelerated) transformation – including job losses and job creation – nor the external dimension – what is the impact of our decisions such as ‘bringing production closer to home’ for example on developing countries in global value chains. The challenge is huge – and the decisions that need to be taken are complex, with wide repercussions at social, financial and environmental levels.

Given these complexities, recovery plans should be built together: with input from all stakeholders. A global multi-stakeholder Alliance for Green Recovery as proposed by MEP Canfin is great to coordinate action, but the focus needs to be on ‘action’.  While teleworking and distancing may pose unusual challenges for any engagement activities in Brussels or other policy hubs, it should not be too big a hurdle. It is even more important in these times, where crucial, wide-reaching policy decisions will be taken and realism and feasibility on the short-term is key, to engage with stakeholders and policymakers alike. Share views, projects, ideas, concerns. Let’s not be held back by any virtual impediments – instead make the best of all the digital tools we have at hand.