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THE EU IN THE INTERNATIONAL CLIMATE NEGOTIATIONS - LOST AND DEFEATED?

Introduction

The purpose of this short paper is to contribute to the debate about the EU's role, in particular the EU's aspirations for a leadership role, in the international climate negotiations. This has been the subject of interesting projects, including the recent 'EU leadership initiative' launched by IEEP's partner office ECOLOGIC in cooperation with the Wuppertal Institute. This paper aims to help catalyse further debate that could lead to new approaches to an 'old problem'. The key question is how the EU's negotiating approach can be strengthened. Why is the EU not more successful in pursuing its objectives in the climate negotiations? How can the EU overcome internal disagreements in order to operate more effectively?

Climate change is a top priority for the EU. The Sixth Conference of the Parties to the Climate Convention (COP 6) in November 2000 will be a decisive meeting for implementation of the Kyoto Protocol. Important issues, such as rules for emissions trading, are at stake for the global community and for the EU.

EU Member States are clearly seeking to play a leading, positive role in the development of a fair and effective global climate change regime. They have environmentally progressive positions on many issues. However, somewhere in the process of developing EU strategy and taking it forward in the negotiations, the good intentions and initiatives seem to become lost. Unless the EU finds new ways of approaching the climate negotiations in the coming months, an all too likely scenario is a road to defeat at COP 6, paved with unclear objectives, lack of strategy, disagreements and dithering.

This paper first outlines some background issues. It then considers the 'concrete ceiling' on the flexibility mechanisms, meeting the Kyoto Protocol commitments, the EU, the US and developing countries, concluding with a section on ways forward.

Background

The EU should exert the influence of a major power, but consistently manages to negotiate as 'less than the sum of its parts'. The reasons for this seem to be a combination of institutional and political factors. In addition to the problems that are specific to the European context, government approaches to international negotiations tended towards the reactive in the nineties. The proliferation of new international agreements and bodies in the last decade seems to have overwhelmed most governments, resulting in a tendency to make policy as a reaction to the agenda for the next international meeting, rather than developing results-oriented long term strategies.

Some of the EU's difficulties reflect this broad background problem, but the specific European institutional and political circumstances create a more complicated situation, which also makes it more difficult to identify critical intervention points for change. Currently, the Commission seems to struggle to attract sufficient support for initiatives that require Member State or Council action. Diverging views among Member States are a key factor.

The 'Concrete Ceiling' on the Flexibility Mechanisms

The saga of the EU position on restricting use of the flexibility mechanisms (emissions trading, the Clean Development Mechanism and Joint Implementation) as a means of achieving the greenhouse gas reduction targets in the Kyoto Protocol is a good example of disagreement among Member States leading to a weak EU position.

At the Fourth Conference of the Parties (COP4) in Buenos Aires in 1998, the EU maintained that a 'concrete ceiling' would have to be put in place to ensure that domestic action remained the primary means for reaching the reduction targets of the Kyoto Protocol. The EU was only able to agree what that concrete ceiling should be after protracted negotiations in 1999. Then, many NGOs highlighted the difference between the EU's international cap proposal, presented as a 50 per cent ceiling, and the use of the 'flex mex' various Member States would actually be allowed if the EU cap formula were to be applied. IEEP analysis noted that the relevant Council conclusions were also ambiguous in that they refer to defining 'supplementarity' (relevant only to emissions trading and Joint Implementation), while seemingly leaving 'part' (ie a cap on the Clean Development Mechanism) undefined (minutes of Council meeting 17 May 1999).

The '50 per cent' proposal seems to have been based on the level of reductions some EU Member States believe they can realistically achieve at the domestic level. If 50 per cent domestic action is seen as an achievable implementation goal, it seems unfortunate that the opening EU negotiating move at the international level was not significantly stronger. 'Negotiating down' from your own target (always assuming this is the 'real' target) is clearly not a desirable strategy. In light of the EU's earlier insistence on a 'concrete ceiling', this looked particularly weak.

Meeting the Kyoto Protocol Commitments

Defending the EU position on restricting use of the flexibility mechanisms has been made more difficult by the EU 'bubble', which permits the EU to redistribute its 8 per cent reduction target under the Kyoto Protocol among its Member States (see Article 4). If the EU is free to 'trade off' reductions among its Member States, why should similar opportunities not be available at the global level?

The lack of a progressive leadership group has been identified repeatedly as one of the reasons for slow progress in the international climate change negotiations, with the EU usually being identified, by commentators inside and outside Europe, as the group that should take on this role. However, failure to reach internal agreement on the proposed EU framework for energy taxation and difficulties with the proposed Directive on renewable energy sources illustrate the challenges faced by the EU in implementing its commitments. The Commission's strategy Communication Preparing for Implementation of the Kyoto Protocol (COM(1999) 230 final) confirmed that emissions trends are rising. At the international level, the EU's implementation problems, many of which are mirrored by similar problems at national level within the Member States, mean that EU efforts to exert leadership through progressive proposals are not always seen as credible.

The EU, the United States and Developing Countries

The Fifth Conference of the Parties (COP 5) in 1999 confirmed that the main negotiating trends are still in place: the US sets the agenda, while the EU in contrast comes across as reactive, weak and fragmented. As one leading developing country negotiator put it: the US never negotiates near its bottom line, while the EU negotiates consistently below its bottom line.

US positioning in the negotiating process, being willing or able to ratify the Kyoto Protocol only if a large number of conditions are fulfilled, has been a major influence on the EU. It is helpful that the possibility of entry into force of the Kyoto Protocol without the US is now receiving serious consideration. Continued discussion of this option could assist in shifting some of the negative negotiating dynamics based on the assumption that it is necessary for the EU to make the concessions the US requires to ratify.

In contrast to the EU, it is interesting to consider the Group of 77 (G77), which consists of 133 developing countries with widely differing interests and starting points, a majority of which are represented in the UNFCCC process. The G77 has little or no institutional structure and minimal financial resources dedicated to the climate negotiations, but still has managed, for a large amount of the time, to negotiate as a relatively coherent group, in spite of significant tensions. In some situations, the EU, a geographically, politically, economically and legally close group of countries, can come across as strikingly uncoordinated in comparison.

The EU's approach to the G77 appears overly influenced by the US, and has not always seemed very constructive. As far back as the Intergovernmental Negotiating Committee (INC), which preceded the COPs, the EU pursued increased commitments for developing countries. In combination with major questions about implementation of existing commitments in the EU and other industrialised countries, this created an impression that could easily be perceived as a commitment to shift the reduction burden from industrialised countries to the South. The resulting atmosphere of suspicion is now maintained by EU support of the US demand for 'meaningful participation' by developing countries.

Ways Forward?

While some EU discussions are transparent, others, especially those taking place at a high political level, are not, which makes it difficult to assess how much effort may actually have been made to develop a clear strategy for the climate change negotiations. However, it does seem that the EU is lacking a common, results-oriented long term strategy, firmly based on collective priorities.

There have been many calls for global leadership on climate change. Perhaps a leadership group of countries is also needed within the EU. A concerted, positive initiative by a few EU Member States might help to revitalise the Union's approach. On the other hand, as has been seen many times, strong individual Member States can block EU action. This may be a particular challenge in the climate change area, where some EU Member States may well find themselves more at home with the 'umbrella group' on some issues.

The Treaty of Amsterdam introduced the concept of 'flexibility'. A majority of EU Member States can now, in certain strictly limited circumstances, agree to move ahead in 'closer cooperation' (see Article 11, Treaty Establishing the European Community, Articles 43 and 44, Treaty on European Union). It is not clear how broad the provision, which has a large number of conditions attached to it, is from a legal point of view, but it does include environmental policy. 'Flexibility' takes into account that groups of Member States may wish to advance at different speeds within the EU. For example, a majority of Member States could apply stricter environmental rules than a group of new Member States. However, this also raises the idea that in some circumstances a similar approach could serve EU interests in the international negotiating arena. Is there a way of applying a 'flexibility' concept in some international negotiating situations, such as the climate negotiations?

A reality check suggests that the EU may currently not be in a position to exert leadership at COP 6, at least not on issues such as the flexibility mechanisms. Perhaps it is worth exploring a strategy based on defense, rather than leadership. A defensive strategy on issues such as the 'flex mex', could be combined with the selection of a few 'arrowhead' issues, on which the EU is in a position to take a strong approach, as priorities. If that includes issues that are not currently at the top of the international agenda, the EU should work to ensure that they become high priority items. In general, more emphasis on agenda setting, rather than reaction, would help to strengthen the EU's approach.

One of the areas for more proactive agenda setting by the EU could be policies and measures. As described in the IEEP paper Encouraging Implementation of Annex I Country Policies and Measures, and Review Processes under the Climate Convention and the Kyoto Protocol (October 1999), there is a window of opportunity for encouraging in depth exchange of information and experience on policies and measures at the international level, which would help drive effective domestic action. The EU has emphasised the importance of domestic action, and of coordination of policies and measures, but does not seem to have clear objectives or a strategy for the opportunities the UNFCCC process is currently offering.

The international climate negotiations require coordination among many different agencies at the national level, including the usual conflicts between Environment and Finance Ministries. This is a major challenge for most countries. For the EU, national coordination problems are compounded by the need for coordination at the EU level. It is perhaps not surprising that the EU seldom manages to reach 'critical mass' as a negotiating force.

At the moment, the only likely source from which a progressive leadership group of countries could emerge seems to be the G77. However, if the EU did manage to draw together the formidable resources of its Member States in a coordinated effort behind clear objectives this year, it could play a decisive role in the development of the Kyoto Protocol. If that were the case, and if the progressive views within the EU prevailed, COP 6 in the Hague could turn out to be a landmark for EU environmental diplomacy, rather than yet another setback.

Institute for European Environmental Policy (IEEP)
E-mail: JH@ieeplondon.org.uk
_______________________________________ Joy Hyvarinen
E-mail: JH@ieeplondon.org.uk
Web site: http://www.ieep.org.uk