Environmental Diplomacy: Tipping Points Between Europe and the Newly Non-Aligned Countries
Sébastian TreyerExecutive Director of IDDRI
The position of many African, Asian, and Latin American countries concerning the war in Ukraine shows a desire not to align themselves with Europe or the United States, which seems to turn Russia, China, and Western countries against each other. But this new non-alignment cannot be explained in political terms alone: it was also very strongly expressed in Glasgow at the COP26 on climate change in December 2021, and was further strengthened at COP27 in Egypt, when a number of countries from the Global South, such as Senegal as well as India, not only demanded that the developed countries keep their promises of financial support from the North to the South, to help them cope with the catastrophic socioeconomic consequences of climate change and inequities in accessing financial markets, but also, more broadly, that the zero-carbon economy that is being built does not again become a way of confining them to the role of extractive economies, and that, on the contrary, it is an opportunity to rebalance the structure of global value chains and the distribution of power in this new stage of globalization.
These demands for a rebalancing of the global economic system are not new; they were expressed by the Non-Aligned Movement 50 years ago, 1 without any link to environmental issues being made at the time, despite the fact that they were being discussed at the Stockholm Conference at about the same time. Shortly afterwards, the effects of the 1973 energy crisis and the industrialized countries’ economic response policies put these demands on the back burner, with international economic relations further reinforcing the centrality of fossil energy resources and the economic power of the countries producing these energies and not that of all the countries of the South.
Beyond the demands for financial support, is it credible to seek a new international economic order?
Why do these demands for a rebalancing have an entirely different impact today, especially in relation to Europe? The countries that are not aligned, but that are not yet an organized movement, have at least two major grounds on which to base their position in negotiations. First, several of them, especially in Africa, have resources that the European Union does not have, whether for the carbon-intensive economy that still prevails today (which has been made very visible by the gas diplomacy practiced by several European leaders) or for the low-carbon economy of tomorrow, where the crucial role of electrification of applications requires, for at least a decade — alongside the rise of a circular economy for critical materials (rare metals for batteries, for example) — a rapid rise in imports of these materials to Europe.
Second, Western countries, and Europeans in particular, need to find allies in international negotiations, a role that the newly non-aligned countries are not ready to play as mere auxiliaries: without promising any strategic exclusivity, African countries are asking, for example, for proof of a rebalancing in the consideration of Southern countries’ needs, in order to believe in the “partnership between equals” that was sought at the summits between the African and European Unions. This rebalancing should concern the method of dialogue as much as the concrete effects of the implementation of new investments in the service of a trajectory of industrialization: they should therefore allow Southern countries to retain more value, innovation capacity, and jobs for their rapidly growing workforces, at a time when the largest economies are talking about relocating these same jobs back to their own regions.
International environmental negotiations therefore provide a key vantage point for better understanding what the non-aligned countries of the South are expressing and demanding beyond the unfulfilled promises of climate financing that were very loud at COP27 — which is why they are doing it with such force today — and to what extent this can open up an opportunity for the European Union, in order to avoid being crushed between rival superpowers, to profoundly overhaul its relations with these non-aligned countries.
To shed light on this subject, we will examine four interrelated trends that are shaping the field of international cooperation on sustainable development, and for which the war waged by Russia in Ukraine has sharpened the contrasts: the essential yet insufficient role of the G20, the inevitable implementation of a zero-carbon economy, the continuation of international environmental negotiations, and the breach of trust between Southern and Western countries concerning the resources available to achieve possible economic convergence. Where these trends intersect, multilateral institutions continue to play a decisive role, particularly in the area of sustainable development. This is particularly strategic for the European Union.
The G20 at a time of conflict between great powers
While the economic and geopolitical rivalry between China and the United States had been seen as structuring tensions, the Russian invasion of Ukraine has placed the focus on brute force and the undermining of borders and international rules, with Europe seemingly crushed in this game between great powers. At a time when cooperation seems more necessary than ever for a sustainable recovery from the Covid-19 crisis, this war is significantly hindering one of the absolutely central forums for global economic cooperation, the G20. Following the Italian G20, the Indonesian presidency of the G20 was expected to be crucial to the success of negotiations on the use of the IMF’s special drawing rights for sustainable recovery in developing countries, especially as the fallout from Russia’s war in Ukraine further adds to their economic fragility by driving up food and energy prices on international markets. Western countries ran the risk of being perceived as blocking key discussions on IMF and World Bank intervention reform by demanding the condemnation of Russia’s invasion of Ukraine as a precondition for any technical or political document. Fortunately for them, the G20 summit in Bali, in the absence of Vladimir Putin, made it possible to take a big step forward in these essential discussions for the countries of the Global South. But, as we will see later in this text, the discussions held at the same time within the multilateral framework of the United Nations Convention on Climate Change at COP27 also required European and Western countries in general to position their support for this initiative in a different context that is more visible to all of the poorest and most vulnerable countries not represented in the G20.
Additionally, the Indonesian presidency of the G20 was also expected to make progress on the mutual understanding between developed and developing countries on the forms of global trade regulations that are compatible with reducing inequalities and achieving ecological transformation. But today, the strategic economic thinking of the major G20 powers seems to be focused as much on the return to domestic markets, the relocation of supply chains within countries (re-shoring) or in friendly countries (friend-shoring), and the relocation of industrial jobs as it is on a more regulated and fairer globalization. This reflects the fact that security of supply is becoming a central issue in these strategic discussions: the transformation of globalized value chains is therefore being increasingly discussed from the perspective of security, and not just economic competition, even though they are also being transformed not only by official and relatively realistic relocation strategies, but also by technological developments that are increasingly substituting technical capital for manpower, as well as by the underlying trends towards decarbonization of the economy.
Here again, comparatively speaking, concrete negotiations on climate change, which deal with the energy transition and international investments in the countries of the Global South to this end, are putting new forms of partnership and value chains to the test, which anticipate the economic relations of tomorrow. They therefore impose on European actors as much as they allow them to demonstrate both symbolically and concretely how they intend to deal with their partners in the Global South in this matter that is so central to Europe, which is the reconfiguration of the energy system and its access to resources, which is as much at the heart of its economic project as its sovereignty and security.
The momentum towards a zero-carbon economy challenged but also strengthened by the priority given to energy security
The COP26 in Glasgow confirmed the global momentum towards a zero-carbon economy as the goal of modernization, of which the European Green Deal is one of the most emblematic, concrete achievements, closely followed by the carbon neutrality commitments of the world’s major innovative economies: China, South Korea, Japan, as well as Joe Biden’s United States, and especially key states such as California within that country. What has the impact of the war in Ukraine been on this ambitious drive, which is based above all on the convergence of expectations? One of the key dimensions is European dependence on Russian gas. The recognition of the risks linked to this dependence reinforces the European Union’s long-term vision that the Green Deal’s decarbonization targets are also about the security and autonomy of a continent that is particularly poor in fossil resources. It is important to note that this war is placing European ecological transition policy — and therefore the Green Deal itself — at the heart of national political debates, whereas European action in this area had been confined to debate among experts.
However, five points of vulnerability must be noted, as the urgent political decisions required in a war economy must absolutely avoid setting up irreversible measures that are incompatible with transition and sovereignty objectives in the medium and long term. The first point to consider is that the political debate on food security and the transformation of the European food system has led to a collision between short-term responses and long-term issues: on the one hand, there are the short-term needs of countries in the Global South which are structurally importers to access food markets, to which the responses in terms of aid must be urgent and financial, and those of the European livestock sector, which will be the hardest hit by price increases on raw materials, and on the other hand, the need to stick to the 2030 targets of the “Farm to fork” strategy, which are key drivers for structural changes that will reduce Europe’s dependence on imported animal feed and nitrogen fertilizers produced from fossil fuels. The decisions of the G7 and the European Council, driven by France, highlight the need for short-term intervention, but should not undermine the European food system’s structural transformation.
The second point of concern is that rising energy and food prices in Europe will require the implementation of emergency solutions to support the poorest households. Again, these measures should help, where possible, to reduce household dependence on fossil fuels (e.g. by supporting access to energy efficiency or heat pumps) rather than weakening the economic signals favoring fossil fuels over non-carbon fuels. The forms of social assistance and compensation implemented throughout the Union will obviously be at the heart of national political debates on purchasing power: if properly framed, they should be able to contribute to political mobilization in favor of the Fit For 55 package’s core measures (particularly in terms of energy taxation or social funds for the climate); however, translating them into policy remains extremely difficult, and risks undermining European decisions rather than demonstrating their consistency.
The third point of concern is that the energy security angle often skips over the issues of energy efficiency and reducing demand and focuses solely on energy source substitution. For the time being, it seems that issues of sobriety are nonetheless managing to enter discussions across the political spectrum, preparing public opinion for possible rationing measures for energy in particular. While a clear distinction will have to be made between emergency rationing measures and medium-term demand management, citizens, civil society, businesses, and public authorities will be responsible for drawing lessons from this experience for more sustainable and preferred changes in our lifestyles.
Furthermore, the fourth point of concern is a more uncertain international dynamic. The American fossil fuel sector is looking at the European need for alternative energy sources to Russian gas as an opportunity to massively boost its production, despite the rather poor carbon footprint of liquefied natural gas exports. The war’ consequences for Chinese energy policy are not very visible from the outside, even though support for low-carbon energy seems to be an inevitable feature of the modernization of this huge economy.
Finally, a crucial last point is that while large European and international companies remain committed to contributing to carbon neutrality in the long term, strategies for concretely implementing this ambition may still be overly reliant on large volumes of negative emissions or offsets through voluntary carbon credits, which are supposed to compensate for excessive residual greenhouse gas emissions. This creates a new impetus for carbon finance projects, in particular those based on changes in land use: these could be seen as a potential opportunity to trigger the structural transformations necessary for the agricultural and economic development of Southern countries, but their proliferation also poses a very high potential risk for the food security of local populations concerned and for biodiversity. The report entrusted by the UN Secretary General to a group of high-level experts chaired by former Canadian Environment Minister Catherine McKenna 2 specifies that voluntary carbon credits, which must have high environmental integrity and include benefits for both biodiversity and the development of local communities, will not compensate for unfulfilled decarbonization efforts and must be accounted for through separate accounting.
European and Western economic circles seem to be beginning to doubt the feasibility of keeping the average global temperature below a 1.5°C increase over pre-industrial levels. The difficulties of achieving carbon neutrality, which are necessarily challenging by the standards described in McKenna’s report, could also sway the scale or speed of change in these companies. But many of them, particularly in Europe, have also already invested in the decarbonized economy as a necessary driver of growth (such as the transition to electric vehicles in the automotive sector), thereby cementing the zero-carbon economy as at least one of the key trends in economic relations in the world of tomorrow.
What are the concrete consequences of continuing and expanding multilateral environmental negotiations?
Despite a much lower level of media attention than the war in Ukraine, the whole of 2022 was also marked by very intense activity in multilateral environmental negotiations, particularly on the ground. These negotiations lead both to the launch of new negotiations and to the identification of critical blockages.
The United Nations Environment Assembly, in its 5th session, agreed to launch two new negotiations that should be concluded by 2024: a new treaty on plastics, and a science-policy platform for addressing chemicals, waste, and pollution. While these new negotiations reflect a very accurate analysis of the importance of these issues for the preservation of global ecosystems, they also appear to be overly optimistic about the time needed to create new multilateral institutions, especially given the slow pace of the negotiations on biodiversity in the high seas (BBNJ). The risk is therefore great that these multilateral negotiations will not only signal agreement by the entire international community, including Russia, on the importance of preserving the environmental commons, but that they will become bogged down without having a significant impact on the sectors and public policies concerned.
There is therefore a risk of a major disconnect between the will to continue negotiations and the ability to reach concrete agreements. This risk also reveals two major structural tensions between the world’s major regions. The first structuring tension is that for several major powers, such as Russia and China, the pursuit of environmental negotiations is acceptable so long as they are limited to the purely technical and excluding any political dimension, particularly in terms of human rights and the place of civil society. In contrast, negotiations on biodiversity are experiencing the rise of a growing front of actors and countries who support the importance of the political and technical role that indigenous peoples and local communities must play in order to truly protect biodiversity. And we are seeing more and more concrete examples of how the rights granted to citizen movements, civil society and indigenous peoples are no longer incantations but real levers for transformation. In Latin America, for example, the Escazu Agreement on participation, information, access to justice and the rights of indigenous communities in environmental matters has come into effect. In Europe and other regions, legal action by civil society is one of the levers that can be used to make the international commitments of States a reality. European actors strongly support the inseparable nature of action for ecological transformation and the functioning of democratic institutions. A likely stumbling block in some of these future negotiations, it is also a rallying point that Europe can offer to other regions of the world.
The potential for alliances and rallying is exactly what is at stake, given that the most striking incident in the recent environmental negotiations was the insistence with which Southern countries, and in particular the African group, chose to mark the end of the biodiversity negotiations in the spring with by emphasizing the discrepancy between their financing needs and the promises made by developed countries in this matter, just as they did with regard to climate financing. This is the second structuring tension, which is expressed in relation to the environment and reveals a deeper breach of trust, as we have seen above, and which will be discussed in the last section of this article.
Why, then, are multilateral environmental negotiations the focus of so much investment by European countries; why must they receive the full attention of geostrategic analysts? Quite simply because what is at stake is the setting of key standards that could define tomorrow’s economic champions and economic relationships within value chains, well beyond critical materials and energy resources. This is illustrated by the battle over defining sustainable agriculture and food, highly visible at COP27, yet already in 2021 in the form of a report by the USDA criticizing the European Farm to Fork strategy for its economic effects in Europe and around the world: through sometimes barbed exchanges, European and American experts are competing, before the rest of the world at United Nations conventions on climate or biodiversity, to ensure that the prevailing model of agriculture is either carbon-optimized and compatible with vast, specialized spaces and the forms of value extraction through economies of scale and massification used by the United States agri-food industry or, on the other hand, a model that aims to protect biodiversity and the quality of water and soils as much as the climate, and that presupposes profound transformations of business models and large production zones by focusing on re-diversification, which is not only a source of quality improvement but also of resilience. Besides this “food diplomacy”, we could also mention the efforts to define green hydrogen or green steel, which are radically decarbonized. All these definitions and concepts debated among experts, which are ready to move towards forms of standardization or regulation, cannot be reduced to specifications of production or processing techniques: they also bring into play, in a much more profound way, the division of power to prescribe, create value, and innovate and thus, ultimately, the division of jobs and income among the various actors within sectors and among the major regions that are interconnected in the global economic system. This is especially the case with regard to forms of investment and the institutional and contractual arrangements that underpin them.
Repairing trust between North and South through climate negotiations?
Although COP26 in Glasgow was a success in terms of the commitment to carbon neutrality, it was also a resounding failure in terms of reaching the target of $100 billion per year in financial support from the North to the South, which was supposed to begin in 2020. Added to this was the warning of the most vulnerable countries about their inability to cope on their own with the damages linked to the effects they are already experiencing as a result of climate change: in making claims for reparation of ecological debt, these Southern countries are also pointing out, more broadly, the shadow that the colonial era casts over the global economic system’s current structure, whose value chains are controlled by the richest countries.
When India indicated in Glasgow that beyond the promise of 100 billion per year, it is 1,000 billion per year that this country spends on climate matters, or when Gabon indicated in Geneva during the preparatory negotiations for COP15 that rather than the 10 billion currently under discussion, it is 100 billion per year that Southern countries need, two things must be understood. Firstly, the countries mentioned above are increasingly distrustful of the financial promises made by OECD countries, and Europe in particular, whereas it is clear that the United States is the furthest away from fulfilling its part of these climate funding promises. Second, and more importantly, the countries of the South have highlighted a striking gap between their investment needs and their own financing capacities: they are subject to the pressure of a rapidly growing workforce in the coming decades, which will require an investment trajectory for an unprecedented form of rapid industrialization that will provide jobs and income at a time when industrial jobs are being whittled away by technological progress, successive and prolonged crises are bringing these countries to their knees, and climate change is causing them to be hit by more serious and more frequent disasters. These countries also point to the huge gap between the funds mobilized by Northern countries for their own recovery and those they mobilize to support recovery in the South.
One of the key reports discussed at COP27 was the one produced by British economist Nicholas Stern, African economist Vera Songwe, and Indian economist Amar Bhattacharya, on the massive need for scaling up development and climate finance. 3 This report underlines the difference in magnitude between the promise of 100 billion dollars per year and the immense needs of Southern countries for climate action, both in terms of reducing greenhouse gas emissions and adaptation, as well as in terms of dealing with the catastrophic impacts that have already occurred: the need for financing is estimated at 2,000 billion dollars per year, of which at least 1,000 billion dollars should come from public or private financing from Northern countries.
Faced with these amounts, which may seem excessive, the same report indicates the need for a profound reform of not only the use of the IMF’s special drawing rights, as already put on the G20 agenda, but also, more broadly, of the treatment of debt and of the mandate and forms of intervention of the World Bank, the multilateral banks linked to it, and the IMF itself. Who other than these institutions created at the end of the Second World War would be able to allocate such sums to the countries concerned? Wouldn’t the deep and prolonged crisis affecting countries that were previously emerging economically also be the last chance for these institutions — whose governance is still dominated by Western countries — to prove their relevance and effectiveness?
The Prime Minister of Barbados, Mia Mottley, has reached out to these institutions and to the G7 countries with the creation of her Bridgetown Agenda 4 which aims specifically at this reform of Bretton Woods, guided less by the issue of justice in governance (which could be dealt with later) than by the justice in the effects it could have to avoid a major economic decline of vulnerable countries, including the least developed countries, but also the lower-middle-income countries.
If this reform was discussed and moved forward at the G20 in Bali, it was also at COP27 that the French President was able to officially commit, before all the countries gathered by this multilateral body, to support the Prime Minister of Barbados to achieve this reform as soon as possible, in other words, for the spring meetings of these international financial institutions based in Washington.
But more broadly, as we have seen, the countries that have not aligned themselves are also calling for a different governance of economic relations that are rapidly changing, of power relationships, and the distribution of value and jobs in value chains that are actively undergoing reconfiguration. Where is this governed? It is probably not a matter of trade policy or tariff regulation, discussed at the WTO. Perhaps it is more a matter of the rules governing international investment, framed by international agreements linked to the WTO or dispute settlement mechanisms, such as those China has just set up in the framework of the New Silk Road to challenge the dominance of the mechanisms established by Western countries. However, these generic investment rules do not define to what extent the various operators can be considered innovators and creators of value, or merely suppliers of raw material. China made no mistake by focusing the China-Africa cooperation forum not on the issue of infrastructure financing, but on that of productive investment in Africa.
This is indeed the key issue at stake in many of the specific institutional arrangements discussed during climate negotiations, and in particular in the transformation of energy systems, in both the North and the South. For example, the German strategy of importing green hydrogen on a large scale was widely criticized and discussed during a workshop organized by the Ukama dialogue platform between European and African think tanks, which aims to bridge the gap between the needs of ecological transformation and those of structural economic transformation on both continents. In Europe’s vision, how can the zero-carbon economy of tomorrow make room not only for the economic sovereignty of the European continent but also for African economic actors as drivers of innovation, industrialization, and therefore, massive providers of employment for the African continent’s young people? How can Europe guarantee that, in the current geostrategic turbulence, it will not try to confine Africa to a purely extractive model of raw material producers? What these debates between experts 5 reveal is that conditions for rebuilding trust in this regard are clearly being discussed around European development policy — renamed “international partnerships” in its trade policy — but also much more concretely in investment decisions and contractual arrangements between public and private operators on the two continents. One example is by choosing to support not only the export of hydrogen from renewable energy sources produced on the African continent, but also by ensuring that the hydrogen is used primarily to develop the industrial sector locally.
European actors are rightly focused on setting up concrete and effective mechanisms with dual benefits for socio-economic development and the climate, such as the Just Energy Transition Partnership (JETP) signed with South Africa in Glasgow, and are seeking to set up new ones with a few key countries, such as the one announced at COP27 with Indonesia. In this context, it is essential that the notion of justice reflects not only the priority attention given to employment issues in the planned transformations of energy systems and economies of countries as a whole, but also the conditions for negotiating these partnerships, which must be rooted in Southern countries’ needs and, above all, the concrete forms of investment that the involvement of a public donor from the North makes it possible to guarantee, thereby ensuring that economic operators in the South and their trajectory of industrialization have their rightful place. 6
This year Europeans are sending conflicting messages regarding the development of gas infrastructure, something that has been widely noticed and commented on by African heads of state, such as the Nigerian president: 7 while European public financial actors such as the EIB or the AFD have announced that they will no longer finance infrastructures linked to fossil fuels, gas terminals are nevertheless being developed in Europe and subsidies for the use of gas are being put in place to help European consumers cope with soaring prices, sometimes with no extra care to discourage a shift away from fossil fuels. It is therefore a high-risk discussion that has begun and that COP27 will have allowed to advance without finalizing it. Either the JETPs are an opportunity to demonstrate a new, more just way of building investments and value chains between the two continents, or they confirm the radical criticism of Southern countries of what they call the hypocrisy of the Europeans.
Despite the current focus on the war that is happening on European soil, Europe must continue an extremely active dialogue with the least developed and most vulnerable countries of the South, and not only for the purpose of countering China, as in the Indo-Pacific dialogue, but in the service of rebuilding concrete strategic partnerships, allowing Europe and its partners to avoid being crushed between the rivalries of Chinese, Russian, and American powers. In this respect, environmental multilateralism is an inevitable step, but also an opportunity to demonstrate new ways of negotiating and new ways of building economic partnerships.
In order for this partnership to be viewed as sincere and based on trust, Europe must continue to show that it is truly listening to the demands, views, and needs of its partners, even when taking them into account seems difficult: calls for reparations, calls for taking into consideration the post-colonial legacy, highlighting European contradictions in the treatment of recent wars in Iraq, Libya, Yemen, or Ukraine, these must be heard… because what these countries are also expressing is the need to concretely test the sincerity of European commitments in implementing concrete partnerships for Southern countries to meet the targets of the 2030 Agenda, as much in terms of climate as in prosperity.
This does not mean, on the contrary, that Europe should not clearly assert its position and its values, particularly in terms of democracy and human rights, both for their intrinsic value and as an instrument to support the necessary transformations: without the possibility of a political dialogue open to civil society and counter-expertise, there can be no credible path of investment to achieve economic prosperity while respecting the planet’s limits. We therefore need to show that Europe’s offer in this area is not a conditionality or a brake on the mobilization of investments, but rather a pledge of long-term viability and sustainability of investments, and therefore a pledge of stability, predictability and attractiveness for investors.
Is the massive access of Southern countries to global financial flows facilitated rather than hindered by the demands of governance and democracy, as well as environmental and social impact? Is the reconfiguration of global economic relations made even more unjust by the transition to a low-carbon economy, or is it instead an opportunity to concretely demonstrate new power relations in value chains? It is absolutely essential, and quite strategic in the current geopolitical context, that European actors and their many allies in other regions continue to use multilateral environmental negotiations to tip the balance in the right direction for the prosperity of non-aligned countries as much as for that of Europe and for the protection of global environmental public goods.
- See the declaration of the United Nations General Assembly of May 1, 1974, concerning the establishment of a new international economic order, which reiterates very similar considerations to those invoked today in a time of global economic crisis.
- United Nations, Integrity Matters: Net Zero Commitments by Businesses, Financial Institutions, Cities and Regions United Nations’ High Level Expert Group on the Net Zero Emissions Commitments of Non State Entities.
- Vera Songwe, Nicholas Stern and Amar Bhattacharya, Finance for climate action: scaling up investment for climate and development, Novembre 2022.
- See the text by Avinash Persaud in this issue.
- Sébastien Treyer, Chukwumerije Okereke, John Asafu Adjaye, San Bilal, Ann Kingri, Imme Scholz, Youba Sokona, Africa’s transition from a provider to a key actor of the global energy transition, IDDRI, February 2022.
- ege, E., Okereke, C., Treyer, S., Sokona, Y., Kingiri, A., Keijzer, N., Denton, F. (2022). Just Energy Transition Partnerships in the context of Africa-Europe relations: reflections from South Africa, Nigeria and Senegal. Ukȧmȧ.
- Chiamaka Okafor, Climate Change: Western countries are hypocrites, can’t dictate to Africa – Buhari, Novembre 2022.
Sébastian Treyer, Environmental Diplomacy: Tipping Points Between Europe and the Newly Non-Aligned Countries, Jan 2023, 82.
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