This article was published before we became the Chartered Institute of Export & International Trade on 10 July 2024, and this is reflected in references to our old brand and name. For more information about us becoming Chartered, visit our dedicated webpage on the change here.

EU Climateissues

Yesterday (6 February) the EU rolled back several key environmental targets in a bid to quell protests among farmers.

For several weeks, protests in Germany, France, Belgium and the Netherlands have caused disruption, as farmers blockaded motorways and port access roads.

Concessions are believed to reflect fears among EU leaders that the upcoming parliamentary elections in June will see a rightward shift from voters.

Fergus McReynolds, Institute of Export and International Trade’s (IOE&IT) director of EU public, said the decision "is confirmation of the tight political negotiations that will characterise EU policy making in the coming months ahead of EU parliamentary elections".

"With many European countries facing national elections this year, as well as the EU Parliamentary elections in June and likely protracted confirmation of a new EU Commission, policy development across Europe will not be immune from influence by external events."

"It will be interesting to see the direction and strategy mandate the next EU Commission (2024-2029) is given by the end of the year."

Green rollbacks

Officials in Brussels rolled back draft proposals as they finalised a road map to cutting emissions by 90% by 2040 – a key milestone en route to achieving net zero targets by 2050.

Among the abandoned measures were a 30% cut in methane, nitrogen and other gas emissions linked to farming, shelved despite a previous draft identifying that 10% of “core emissions” are produced by agriculture.

Draft documents did acknowledge the role that reducing food waste, changing the chemical composition of fertilisers and promoting less carbon-intensive foods could contribute to these targets.

This isn’t the first such concession made by the EU in the wake of the protests. Since January, other rollbacks include concessions on land earmarked for conservation – now available for farming – and increased support for farmers amid the liberalisation of Ukraine’s grain trade.

Commission president Von der Leyen also announced the proposed target to halve the use of pesticides has been removed, calling it a “symbol of polarisation” and adding:

“I know that they are worried about the future of agriculture and their future as farmers. But they also know that agriculture needs to move to a more sustainable model of production so that their farms remain profitable in the years to come.”

Agri-riots

The concessions follow a wave of protests across several EU countries, most notably France, Germany, Belgium and the Netherlands in recent weeks, although they began as early as last spring with Polish farmers blockading roads from Ukraine.

Farmers have been airing frustration over a slew of issues, including cheap imports, increasing costs, diminishing revenue and increasing regulation, as reported by Politico.

Analysis from the outlet showed that across 11 EU countries, prices paid to farmers fell by more than 10% between 2022 and 2023.

On Monday (5 February), Belgian and Dutch farmers used tractors to obstruct the Dutch-Belgian motorway border that connects Maastricht and Liege, with Dutch police later called to incidents along highways, including fires.

This followed Thursday’s protests in Brussels, which saw farmers bring Brussels city centre to a stand-still as they egged the European parliament. The tactic originated with French protests which effectively blockaded Paris at the end of January.

Political fallout

EU concessions to farmers have been interpreted as a response to fears of a rightwards swing in June’s upcoming European parliamentary elections.

Experts have projected that the parliament’s far-right Identity and Democracy group, made up of Germany’s AfD party and France’s National Rally, could become the third-largest bloc.

With a climate-sceptic position one of the key policies offered, questions have been raised about how the EU would push ahead with its green agenda.

Far-right figures have taken the opportunity to praise the farmers while attacking the bloc’s leaders. Italian transport minister Matteo Salvini said:

“Long live the farmers, whose tractors are forcing Europe to take back the nonsense imposed by multinationals and the left.”

Net Zero Industry Agency (NZIA)

Away from the protests, another of yesterday’s key talking points was the manufacturing of clean tech to support net zero goals.

As part of the drive to zero emissions, one of the EU’s targets is to produce 40% of the equipment required to support the green transition by 2023, such as solar panels and wind turbines, while reducing its dependency on China amid fraying relations.

If passed, the NZIA, spearheaded by Belgium during its presidency of the bloc, would facilitate this by supporting local production.

Measures include simplifying the permit-granting process for projects that could boost EU manufacturing and introducing environmental criteria for public bodies awarding green contracts, with non-cost measures required to account for 30% of criteria.

Agreement on the Act’s terms has been hailed as a proactive response to the US Inflation Reduction Act (IRA), a package of green subsidies which many feared would encourage EU manufacturers to relocate.