2024-04-09 03:18:41
The planet has been the priority in recent years, now it must be European businesses, say the politicians who pushed the Green Deal themselves. The leader of the European Greens wants to pour hundreds of billions of euros into the European elections to help companies, and the Czech Pirates, who belong to the “green” faction in the EU, have their own proposals.
We need to support European industry and invest heavily in it. These words were not spoken by the Minister of Industry of an EU member state, as one might guess, but by the main face of the European Greens in the European elections, Bas Eickhout.
“The main focus must be on European companies. We need an industrial strategy for the EU and massive investment in it. Otherwise, we will not be able to withstand the competitive pressure of the rest of the world,” said Dutch MEP Bas Eickhout in an interview with the daily Aktuálně.cz.
Photo: EU
Eickhout, who came to Prague at the invitation of the leader of the Czech Greens for the European elections, Johanna Nejedlová, he is thus another in a series of key European politicians who calls for a change in EU priorities. While in recent years these were measures to combat climate change, after the new European elections it should be – in addition to strengthening the continent’s defense – the economy. Dutch Prime Minister Mark Rutte, Danish Prime Minister Mette Frederiksen, the leaders of the Baltic countries and others have already made the same appeal.
The European right criticizes the very Green Deal of 2019, which aims to make the continent climate neutral by 2050. That is, to produce only as many greenhouse gas emissions as it can absorb or neutralize.
European populists, conservatives and others say the Green Deal measures are too restrictive for business and prevent EU businesses from succeeding in the world. He is therefore talking about the repeal of some laws that have been voted by European governments and MEPs in recent years.
Most often mentioned is the regulation that requires large companies to monitor how their suppliers from third countries deal with the environment and workers’ rights. Companies claim that this represents too much of an administrative burden for them.
Politicians from Central Europe and especially from the Czech Republic are criticizing the agreement on the end of the production of cars with internal combustion engines after 2035. Everyone is pinning their hopes on the new European elections, which could result in a less “green” European Parliament – critics of the Green Deal are expected to succeed at the ballot box.
Video: Interview with MEP Bas Eickhout
Video: Kateřina Šafaříková, Aktuálně.cz
A big European loan?
Bas Eickhout wants to go a different way than canceling the Green Deal. “The conclusions of science say that we should reduce greenhouse gas emissions even faster than before, not slower. To go against the Green Deal would be to go against the facts,” points out Eickhout, himself a chemist by profession who participated in the conclusions of the IPCC scientific panel on global warming.
“We would risk that our outdated production will not be attractive to the rest of the world. Europe will turn into a fossil museum. I want to prevent that,” he continues.
Specifically, Eickhout proposes that the European Union borrow money from the markets, similar to what it did after the coronavirus pandemic. At that time, the EU collectively went into debt and the European Commission borrowed over 800 billion euros – 9 billion of which the Czech Republic received – which was guaranteed by the common European budget.
A Dutch MEP wants the EU to do the same and invest money in European industry. “We need to invest massively mainly in energy infrastructure. In our interconnection and in hydrogen as a stable clean source,” he claims.
“Today, the EU is a cluster of 27 energy islands. This is a mistake. Our energy is expensive, it is the main reason why European companies lose to American or Chinese competitors,” says the leader of the Greens. He did not quantify the specific amount of business support, but it would be “certainly in the order of hundreds of billions of euros”.
Relief for entrepreneurs
While basically everyone wants to support European business, a number of EU countries do not agree with the idea of further joint indebtedness – there is also talk of a loan to arm Europe. Mainly against is the largest European economy, Germany. Berlin claims that the loan due to covid was “once and for all”. Even the majority of the Czech government does not like the new Eurobonds.
However, it is possible for states to change their minds. Even in the case of a pandemic, many countries were initially against it, but reality forced them to modify their position. The former prime minister of Italy, ex-head of the European Central Bank and respected authority among European politicians, Mario Draghi, is also expected to come up with a plan for massive investments in European industry.
He received an assignment from the head of the European Commission to present an analysis of how to increase the competitiveness of European companies. Draghi estimated the preliminary support at 500 billion euros, while a third should come from public sources.
Before the upcoming European elections, the Czech Pirates, who are part of the Green faction in the European Parliament, came up with their own proposal to revive the economy. Like Bas Eickhout, they do not want to cancel the Green Deal, but to help business on the continent.
In the document “We’ll fix the Green Deal”, the pirates specifically propose that the EU acquire a “European IRA”, i.e. a similar version of the American anti-inflation law from August 2022. It contains tax write-offs and other concessions for American manufacturers of clean technologies. The amount of the reliefs reaches approximately 300 billion dollars and they are very popular among businesses due to their simplicity. Experts point to the IRA as the reason why the US keeps pace in the global competition of “green” economies.
The Czech Pirates want to follow the path of the same tax breaks at the level of the entire EU. However, direct taxes, whether of companies or individuals, are the exclusive competence of individual national governments. The party of Deputy Prime Minister Ivan Bartoš therefore wants to “initiate a change in the treaties that will enable the discussion of corporate tax in the EU through a standard legislative process,” the pirated document claims.
However, changing treaties normally takes years, and previous attempts to transfer the issue of profit taxes to the EU level have always failed. Individual governments opposed it. The ODS has also always strongly opposed any interference by Brussels in direct taxes.
“We are not reinventing the wheel from the beginning. For example, a corporate tax of fifteen percent is already approved within the EU,” responded Pirates boss Ivan Bartoš to Aktuálně.cz. He alluded to the agreement on the minimum amount of corporate profit tax applicable in the EU. However, each country may have a different actual amount, and any decision about it belongs only to the given states.
“We are striving for a tool that will enable the operative approval of exceptions from the already valid rule, when it would be possible to give a company a tax advantage when it invests in clean technologies,” added Bartoš.
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