Greenpeace asks the President of Romania and the other heads of state who are attending tomorrow’s video conference of the members of the European Council, where the budget allocated to respond to the crisis caused by the COVID-19 pandemic will be discussed, to support the allocation of these budgets as a priority for people and nature, for a green and fair recovery, not for the prosperity of fossil industries.
Greenpeace also calls for the establishment of a monitoring and verification mechanism at the level of the European Commission, through which the granting of post-COVID-19 economic incentives to take into account the provisions of the Paris Climate Agreement. The European Commission and national governments want to invest an unprecedented amount of 4 trillion euros in response to the crisis caused by COVID-19, most of which will go to state aid schemes.
Beyond the controversial bailouts of European economies, a Greenpeace analysis revealed that the fossil fuel industry benefits from a wide range of economic measures on a national scale, including through tax exemption mechanisms, reductions in excise duties on fossil fuels, and legislative changes. The European Heads of State meeting at the European Council on 19 June must ensure that all economic measures and funds allocated are used exclusively for a green and fair recovery.
The 4 trillion euro proposed by the European Commission and national governments would account for more than 25% of Europe’s GDP, and would amount to around 9,000 euro for every European citizen. This budget includes a total of 3.4 trillion from the previous recovery packages, plus the instrument called Next Generation EU, worth 750 billion euros. A large part of this budget is expected to be allocated through national state aid schemes. However, the state aid schemes approved by the European Commission are not conditioned by climate objectives and do not guarantee any alignment with the Paris Climate Agreement. Similarly, large amounts mobilized by the European Central Bank are not subject to any environmental guarantees.
The lack of regulations opens up the possibility for the fossil industry to receive state aid in several ways. The most reported example of industry support is the rescue of the aviation sector – investment in state aid has reached almost 33 billion euro so far. The best-known example of this is the provision of 9 billion euro in a mega support for Lufthansa.
“The Romanian government has already offered rescue aid of 130 million euro for Tarom and Blue Air companies and 291 million euro for large consuming electricity Romanian companies to offset the costs of greenhouse gas emissions that are transferred to the price of electricity. We have heard a lot in the last three months from our leaders about the importance of green and fair recovery; indeed, nineteen EU national governments have publicly supported this, including Romania. And yet, it continues to throw public money at toxic industries and provide safety nets to allow the fossil fuel industry to thrive, while 1 million Romanians have been sent to unemployment,” says Alin Tănase, Climate and Sustainable Transport campaign coordinator at Greenpeace Romania.