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Understanding EU’s Carbon War with China and the World

Apr 05, 2012

Helsinki, the capital of Finland has been ranked as one of the cleanest cities in the world. Europe is reputed for clear air and is fighting for it to stay that way. Yet its latest initiative in fighting climate change; a tax on carbon emissions of airplanes flying into the EU, has led to a backlash from a large group of countries including China. In a rare instance, it has even united China and the US against Europe.

EU Climate Change Commissioner, Connie Hedegaard, and carbon emissions crusader par excellence, has been pushing the climate agenda forcefully inside and outside of the EU. Some Europeans never fully recovered after the shellshock of being sidelined at the Copenhagen climate summit in 2009, but Hedegaard has stayed persistent.

Her insistent diplomatic footwork leading up to the Durban conference at the end of last year, was a vital component in securing a deal. While the result certainly fell short of original EU high-flying objectives and disappointed partisans of decisive action, the universal commitment to a legally-binding deal on climate change by 2015 was pushed as a result of European diplomacy. Instead of settling for the implementation of decisions taken in Copenhagen in 2009 and Cancun in 2010, the EU went for more and got it. As Connie Hedegaard stated, “the EU's strategy worked”. Although they did not sign the Kyoto Protocol, China and other emerging emitters agreed to sign a binding legal agreement curbing their emissions from 2020 onwards. EU realizes that co-operation of China – now the world’s largest carbon emitter – is central for a global legally binding global deal on climate change.

Yet the time for harmonious cooperation during Durban was back in November and December 2011, but from January 2012, the EU has introduced a carbon tax for all airplanes flying into the EU. Harsh words have flowed since. Chinese commentators and others now happily label the EU’s move as ‘regulatory unilateralism’ or ‘norms imperialism’.

China has also officially protested and has called the move ‘unreasonable’ and ‘illegal’. An official statement also hinted at possible retaliatory measures and some pending orders of Airbus planes seemed to have been halted by authorities in China taking carbon spats to a new level approaching trade conflict. Connie Hedegaard has responded with little understanding by stating that ‘to trigger a trade war for €1.9 million, if you're China…’and that she imagined that if people can pay for long-haul flights between China and Europe, then they ‘can also afford to pay for their pollution’. The Chinese estimates of the costs are higher with China Aviation Transport Association estimating that the scheme will cost its airlines some €85 million in 2012. On that background, the Chinese government has tasked its airlines not to pay the tax. The situation is at gridlock.

What’s the EU’s rationale for this ‘regulatory unilateralism’? The EU is no military superpower throwing its weight around the world. The EU influences through its norms, values and its economy; the world’s largest. In Europe, the EU has been enormously successful with spreading its norms and standards to every corner of the continent, particularly through enlargement, where new member states have to apply more than 80.000 pages of laws and standards on top of being a rule-based democracy. The EU is used to the successful export of norms as a negotiation strategy. Globally, the EU pursues similar ambitions and sees itself as a protector of global common goods like climate and the environment. The EU has set the EURO standards on cars emissions that have spread as far as Australia and China. In a European world vision, it is a benign way to secure common goods such as the environment.

Yet in this case, the EU has taken it a step further and decided to take action on its own, when it reached the conclusion that international agreement on taxing aviation emissions wasn’t possible. As Connie Hedegaard stated: ‘let's create a global scheme, but it cannot take 100 years to get it done this time’.

Thus even the EU can get impatient, although the EU is otherwise perceived as an indecisive creature when faced with global and quick events. And decision-making with 27- almost a mini-UN- takes time. Nevertheless, when agreement has been reached inside the corridors of Brussels, the bloc sticks together.

Accordingly, it will be difficult to imagine that the bloc completely abandons the tax, notwithstanding the outside pressure for its abandonment. It is also time for the outside partners like China to look for face-saving options for the EU. If negotiations on a global scheme were launched with a deadline for their completion, then the EU should be ready to remove its unilateral tax now and re-enter negotiations for a global deal with assurance that it won’t be a wait for Godot. And there is a third party to these agreements; the climate is a hard negotiator that isn’t waiting for the political will to manifest itself. Consequently, other powers like China and the US have to come up with a decent reply on how to curb carbon emissions on aviation, if EU’s tax isn’t the answer.     


Jonas Parello-Plesner is Senior Policy Fellow at the European Council on Foreign Relations. He has worked as a senior advisor with the Danish government on Asian affairs. He is on the board of editors of the Danish magazine Raeson.

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