De-risking from China is necessary, but forging green partnerships with other parts of the world is challenging, argues Mats Engström.
Mats Engström is Senior policy fellow at the European Council on Foreign Relations (ECFR).
Europe’s dependence on China for critical raw materials, solar panels, and other products is the focus of the economic security debate.
De-risking from China, as Commission President Ursula von der Leyen outlined in a recent speech, is certainly necessary. Foreign Ministers will discuss how this can best be done during their informal meeting in Stockholm on Friday 12 May, followed by the EU Indo-Pacific Ministerial Meeting.
But looking at issues related to the green transition, it will not be easy.
Chinese top diplomat Wu Peng made several promises during his recent visit to West Africa. Investments in iron ore processing and a new steel plant in Sierra Leone. Better railways and port facilities.
On other occasions, China has committed to extensive cooperation with Africa on industrial development and innovation.
Since the Belt and Road Initiative (BRI) was launched, there have been many nice words from China in Africa and other parts of the Global South and plenty of investment, but not always to the benefit of local people.
However, the offers use a similar language as policymakers in developing countries, on the need for local industrial development and quick solutions for better infrastructure.
The current geopolitical landscape does not favour Europe in the ongoing competition for influence with China and other powers.
High energy and food prices, unsustainable debt levels and the lingering distrust over access to vaccines are issues the EU needs to address much more forcefully to regain trust in the Global South.
And even if the EU Green Deal is impressive and an example for other parts of the world, the external strategy linked to it is too weak. This can already be seen in for example the resistance to the carbon border adjustment mechanism (CBAM).
To have influence in this changing situation, the EU needs to forge stronger alliances with other parts of the world. It is in Europe’s self-interest of economic security.
In a new ECFR policy brief, Susi Dennison and I outline how the EU can develop its climate relations with other parts of the world in a changed geopolitical situation.
We argue that to offer real green partnerships, the EU needs to put its money and other resources where the mouth is.
Decision-makers in other parts of the world will look at what happens on the ground, not at nice words in declarations. The Global Gateway was a response to the BRI – now it is time also for an EU-Global South partnership on green industrial transitions.
This should include delivering on the Global Gateway promises for investment in infrastructure such as electricity grids, as well as on broader climate finance commitments.
But also greater efforts for joint development of green tech solutions, for example through a co-innovation and green tech diffusion fund. Such efforts should be prioritised within the current development program NDICI-Global Europe and beyond.
Other elements should be stronger research cooperation with the Global South through the Horizon Europe program, more support for research institutes and testing facilities, intensified cooperation on skills development and expanded twinning between institutions in Europe and partner countries.
Strategic Team Europe cooperation between EU institutions and different member states is necessary for such efforts. The EU and member states can also do more together to promote technology transfer in multilateral institutions such as UNIDO and the CTCN.
There will be arguments against helping build industrial capabilities in other countries that might compete with domestic European production. And of course, there is a need for careful analysis of the consequences.
But it would be short-sighted to refrain from such cooperation. First, many European companies need to show their customers and investors that their supply chains are green.
Second, green industrial development in other countries will create a bigger demand for components and infrastructure in areas where European companies are strong.
Third, without offers of real partnerships, resource-rich countries might turn even more to China and others, leaving European industry short of necessary raw materials.
Europe no longer has the power to impose its will on other parts of the world – and partnerships are a better way to build a sustainable world order.
This is an urgent task and ideas about strengthening climate diplomacy now have to be rapidly implemented. In addition to protecting our environment, it is very much in Europe’s economic self-interest.