The latest edition of our Sustainable Views newsletter
Dear reader,
Chinese President Xi Jinping is visiting the EU for the first time in five years. Economic reasons, including electric vehicles, are one reason behind the visit. China is producing plenty of EVs cheaply and is desperate to export them to boost its economy; the EU urgently needs to advance the decarbonisation of its transport sector to meet climate targets.
The EU, led by certain countries like France, continues to repeat the narrative of a homegrown energy transition and the European Commission has launched an investigation into EV imports from China. The European Court of Auditors has, however, warned the EU’s 2035 vehicle emissions targets will not be met without significant imports, principally from China and the US.
And, as is so often the case, France and Germany are not aligned on the matter. French president Emmanuel Macron said on Monday after meetings with Xi in Paris: “The EU today has the world’s most open market ... but we want to be able to protect it.” Back in September 2023, though, German Chancellor Olaf Scholz voiced scepticism over the EU’s EV probe. He warned against Europe becoming protectionist and said he favoured “global competition”.
In the latest survey by Eurobarometer ahead of the June European parliament elections, support for the economy and the creation of new jobs come in third place as the issues of most importance to voters. If climate targets are to be met, EU politicians and industries need to be able to create green jobs and opportunities around Europe to boost public support for the transition. At the same time, greener technologies and products will have to be affordable if mass take-up is to follow.
The role of China in all of this will be key, but how the future evolves is uncertain. Ursula von der Leyen, the commission president fighting for a second term, remains deeply critical of Beijing. “Chinese subsidised products such as the electric vehicles or, for example, steel — are flooding the European market,” she insisted in a statement published yesterday. “The world cannot absorb China’s surplus production.”
Meanwhile, Paolo Taticchi, a professor in strategy and sustainability at the UCL School of Management, insists on the implications for businesses of the April 9 ruling by the European Court of Human Rights that Switzerland’s failure to meet its emissions reduction targets constituted a violation of human rights.
“As ESG scrutiny intensifies, corporations must upgrade their environmental strategies and re-evaluate their overall approaches to include more thorough risk assessments and anticipation of potential challenges,” writes Taticchi. “This approach involves engaging stakeholders in collaborative efforts to minimise negative impacts and maximise positive ones.”
On Friday, it was the turn of the UK government’s climate plans to be in the spotlight, with the High Court finding them, for the second time in less than two years, to be unlawful. Those campaigners and businesses I spoke to after the ruling insisted robust emissions targets would create jobs and boost the economy.
“What’s absurd is that the green transition only stands to benefit the UK government. It will open up more jobs and create better energy resilience,” says Smart Green Shipping chief executive and founder Diane Gilpin. “It is in the government’s best interest to do better when it comes to meeting these targets.”
Sebastian Peck, managing partner at venture capital firm Kompas VC, says the legal decision wouldn’t deter his company from continuing to invest in the green transition and to back breakthrough technologies, “even if it shows the government’s ineptitude of abiding by its targets, which introduces additional risk into investment decisions”.
Finally, Florence reports on calls from former Irish President Mary Robinson for companies making “billions from fossil fuels”, the aviation and maritime industries and “billionaires” to be taxed to fund climate adaptation measures, while in our knowledge hub, we examine a report from scientists at the International Union of Forest Research Organizations, which suggests forest-related finance instruments could be doing more harm than good.
Until tomorrow,
Philippa
Philippa Nuttall is the editor of Sustainable Views