Friday

14th Aug 2020

Leaders to battle on climate target and money at summit

EU leaders will attempt to agree on achieving climate neutrality by 2050 on Thursday evening (12 December) in Brussels, but some member states want more clarity on financial assistance on greening their economy, making the deal difficult to reach.

EU countries tried to reach a deal on zero emissions by 2050 in July, but Poland, Hungary and the Czech Republic held out, wanting to see financial incentives.

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The draft conclusions on the summit propose to state that the "European Council endorses the objective of achieving a climate-neutral EU by 2050", EU-jargon for leaving room for member states to achieve that goal on their own terms.

However, the three eastern European countries are worried that the €100bn investment proposed under EU Commission president Ursula von der Leyen's Green Deal and one trillion euros leveraged by the European Investment Bank to help pay for the transition are too vague.

An EU diplomat said on Wednesday (11 December) that these countries want to see "more details on the enabling framework, burden-sharing instruments, financing elements".

"Nothing much was done since July on how to get to the targets, which is a pity, the call to have more clarity on this was not listened to properly," another EU diplomat said, adding that the prospect for reaching a deal was "low".

EU council president Charles Michel, who will chair the meeting for the first time since taking office earlier this month, will try to find a compromise, hoping that the green political momentum in Brussels and globally could put pressure on leaders to agree.

Michel hopes to achieve a political agreement, and work out how to get there in the next months.

"This is not a transactional [issue], this is much more political, where the EU wants to set an example," said a third EU diplomat supporting Michel's approach and the 2050 goals.

"I hope countries see the commission's and the EIB's proposals as a concerted effort to help them," added, hoping that it would be enough to get those hesitant countries across the line.

However, the former Belgian prime minister, well-accustomed to the art of compromise, seems to have little room for manoeuvre.

The issue has also been caught up in the deeply-divisive negotiations about the EU's next seven-year budget (MFF), which will also be discussed by EU leaders on Thursday.

Part of the 100bn in the Green Deal, €20bn, would come from the long-term EU budget, but it is not clear from where, the second EU diplomat said.

Countries that have already seen their EU subsidies slashed in the budget proposal are wary that this amount would also come at their cost.

Money talk

Leaders are not expected to have a breakthrough on the budget as positions have hardened over the last months between the two big group of member states.

Germany, the Netherlands, Denmark, Austria and Sweden want the first post-Brexit budget, which loses an annual contribution of around €12bn form the UK, to stay below 1.0 percent.

Last month 16 leaders from eastern and southern countries insisted on maintaining EU cohesion funds at real terms, and rejected further conditions to the subsidies.

The Finnish presidency proposed a budget cap at 1.07 percent of the EU gross national income (GNI) last month, which was criticised by both sides.

"Net payer countries are repeating 'one percent, one percent', and then it is difficult to move also on the other side," the EU diplomat said.

An extra summit might be needed in early February for leaders to clash before agreeing to a deal later in March or the months after.

"We are getting closer to the beginning of the end," one EU official quipped on Wednesday.

No Johnson

UK prime minister Boris Johnson will be missing from the talks, and will be represented by Michel, as Britons are heading to the polls to vote on Thursday for a new parliament.

EU leaders are expected on Friday (13 December) to state its position that it is ready to start negotiations on the future relationship as soon as Brexit happens.

EU leaders will call for the commission to draw up a negotiating mandate. EU diplomats acknowledge there is not much time to conclude a free trade deal with the UK after the expected Brexit on 31 January.

Talks of that magnitude usually last for years, while the transition period for the UK - if it ratifies the withdrawal agreement with the EU - ends at the end of 2020.

EU officials said that a "basic trade deal" is feasible in 11 months, but a more complex agreement would take more time.

EU leaders will also discuss plans for revamping the EU's structure after Brexit under the so-called conference on the Future of Europe, planned to kick off in next year.

The 27 leaders will be keen to have the conference focus on policies rather than EU institutional issues, a naval-gazing which they fear would alienate EU citizens.

Most member states are not keen to change the EU treaty as a consequence of the conference.

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