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EU proposes joint borrowing to finance 400-billion euro crisis tool: sources
EU proposes joint borrowing to finance 400-billion euro crisis tool: sources

Business Times

time3 days ago

  • Business
  • Business Times

EU proposes joint borrowing to finance 400-billion euro crisis tool: sources

[BRUSSELS] The 400-billion euro (S$596 billion) crisis tool proposed by the European Commission on Wednesday (Jul 16) would be financed using joint borrowing, according to people familiar with the matter. The European Union's executive branch's new budget instrument for the period 2028-2034 would provide loans to countries so they can react faster to adverse events, said the people, speaking on the condition on anonymity. Brussels told member states that it would borrow money on their behalf to raise money for the instrument, they said. Such speed is required in emergencies like Covid or the energy crisis, which have battered the economy in recent years. The fund is likely to prove one of the most controversial aspects of the EU's budget plans, with a number of countries opposed to pooled liabilities, which they see as subsidising less fiscally prudent nations. The EU's US$2 trillion budget for 2028-2034 was bigger than many expected and drew a stiff rebuke from Germany, who dubbed it 'unacceptable.' In a first discussion with EU envoys on Wednesday evening, the commission admitted the new mechanism would be difficult to accept for some member states. They emphasised the tool would disperse money using loans, not grants. Strict controls Wopke Hoekstra, the EU's climate commissioner, told Bloomberg on Thursday that the mechanism would be funded using joint borrowing but that it would be subject to strict controls, including through unanimity among the bloc's 27 member states before any spending using the tool is signed off upon. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up 'This is something you have in your war chest as a potential option,' Hoekstra said in an interview. 'It can only be specific circumstances and with the explicitly given mandate of the member states. Not just when we finalise the budget, but then again in a specific crisis situation.' The yield on 10-year EU debt has risen since the start of the year to hover around 3.17 per cent, but remains below the peak seen in early March which followed the German government's plans to boost spending. The budget put forward on Wednesday kicks off a laborious process which will see the European parliament and the European Council, representing member states, weigh in. EU leaders need to give their unanimous backing. The budget must be agreed by the end of 2027. Commission President Ursula von der Leyen said on Wednesday that the 400-billion euro mechanism would give the EU a 'shortcut' in times of crisis. The coronavirus pandemic was a seachange in EU policymaking with countries signing off on a roughly 800 billion euro recovery facility, financed using joint debt. But for many countries, like Germany, that was a one-off. 'Crisis is no longer the exception, but the norm,' she said. BLOOMBERG

EU wants to see China taking more ambitious climate action
EU wants to see China taking more ambitious climate action

Business Times

time6 days ago

  • Politics
  • Business Times

EU wants to see China taking more ambitious climate action

[BEIJING] The world needs China to show more leadership on climate action, EU Climate Commissioner Wopke Hoekstra said on Sunday (Jul 13), highlighting the importance of cutting planet-heating emissions and reducing the Chinese economy's reliance on coal. Hoekstra is in Beijing for high-level talks with Chinese officials on environmental and climate issues, at which he also wants to encourage China to stop building new coal-fired power plants and phase out use of the fossil fuel. 'We do encourage China to take more of a leadership role going forward and really hit the road with meaningful emission reductions in the next couple of years, and also move out of the domain of coal,' Hoekstra said. The number of coal power plants in the pipeline has been increasing in China, the world's largest greenhouse gas emitter, according to the World Economic Forum. In the first three months this year, China approved 11.29 gigawatts (GW) of new coal power plants, exceeded the approval rate in the first half of 2024, a June report by environmental group Greenpeace showed. Last week, Hoekstra told the Financial Times the EU was holding off on signing a joint climate declaration with China unless Beijing pledges a greater commitment to reduce emissions. 'We are open to looking into a potential declaration, but ... the thing that is most important about these types of statements is the content that goes into it,' he said when asked about the issue, without specifying what commitment the EU hopes to see from China. Hoekstra said the EU is interested in seeking areas of cooperation with China ahead of the COP30 UN climate conference that will be held in Brazil in November. REUTERS

Hoekstra warns Trump policy is a 'major blow' to climate efforts
Hoekstra warns Trump policy is a 'major blow' to climate efforts

Euronews

time10-07-2025

  • Business
  • Euronews

Hoekstra warns Trump policy is a 'major blow' to climate efforts

The Trump administration's reversal of climate policy will have "significant consequences" for the future, EU Commissioner for Climate, Net Zero and Clean Growth Wopke Hoekstra has said. The EU recently outlined its path to attaining 90% net reduction in greenhouse gasses by 2040. Europe is the fastest warming continent with dramatic weather events – from floods to drought -already unfolding across several member states. Hoekstra says the US pulling out of the Paris Climate Accord is a "major blow" to international efforts to tackle climate change. US President Donald Trump fundamentally changed America's climate change policy when, for the second time, he withdrew from the Paris Climate Accord. In addition, the Trump administration reversed an Obama-era clean power plan aimed at reducing carbon emissions from power plants and rolled back emissions standards for vehicles. Although the EU says it is pressing ahead with its plans to deal with global warming, the overall ability for the world to tackle the issue is limited due to the about turn by the US, Hoekstra told Euronews. As the world's second largest emitter of CO2 gas, its "clearly deeply unfortunate and a major blow to international effort", Hoekstra said. "Climate change doesn't discriminate. It doesn't matter for the heating up of the planet where CO2 is being pumped into the air. And if then the second largest emitter, the most formidable power across the globe in geopolitical terms, and the largest economy basically says, well, thanks but no thanks, we no longer play ball. That is, of course, something that has very significant consequences," he said. But Hoekstra says all might not be lost if US investors see the dividends from technologies in the green tech sector. He says the private sector will be useful in paving the way for innovation and delivery of better, greener technologies which will help the environment. "My read is that you will see in the US that whenever an investment in, for example, cleantech pays off, and as a side effect is also something that is good for climate, businesses are not gonna stop it," he said. Hoekstra also points out that Europe needs to grasp this opportunity to win back or attract innovation to the continent in the growing, green technology sector though major European investment and a functioning capital markets system across the EU. "We need to reshape the landscape in such a way that innovation can flourish across Europe and that will take huge steps in terms of the capital markets union," he said. It will take "way more investments from businesses and governments alike in tech and in AI," he said.

INTERVIEW: Climate commissioner says EU needs to be ‘street smart' in how it meets green targets
INTERVIEW: Climate commissioner says EU needs to be ‘street smart' in how it meets green targets

Euractiv

time09-07-2025

  • Politics
  • Euractiv

INTERVIEW: Climate commissioner says EU needs to be ‘street smart' in how it meets green targets

The EU needs to be "pragmatic" and "street smart" when figuring out how to meet its self-imposed climate targets, even if it means outsourcing action to the developing world and tweaking previously agreed laws, Climate Commissioner Wopke Hoekstra told Euractiv in an interview. Last week, the European Commission proposed a 2040 greenhouse gas emissions reduction target of 90% below 1990 levels – a full year after the deadline set in the EU Climate Law, which commits the bloc to achieving climate neutrality by 2050. Hoekstra used the delay to build support among member states for the target, as political momentum behind the Green Deal – the hallmark of Ursula von der Leyen's first term – began to slow. 'There is exceptionally strong support for the true north of a 100% emissions reduction by 2050,' Hoekstra told Euractiv. At the same time, he acknowledged it was 'a very fair ask of many member states' to ensure climate policies are more tightly linked to competitiveness than before. Hoekstra also said the many conversations he has had with European leaders and MEPs in recent months had convinced him there was still "overwhelming support" for "ambitious climate goals." One outcome of this shuttle diplomacy, he said, was a recognition that the target would only be politically viable if governments were granted some flexibility, notably, the option to outsource part of their climate action to the developing world. Open to carbon credits Hoekstra said he has always been 'intellectually open' to the idea of using carbon credits – a concept codified at the UN level at last year's COP29 conference in Baku – to monetise climate action in the developing world. 'We know how not to do it,' he said, acknowledging that past offsetting schemes had been marred by accusations of greenwashing. It would only work if the system is 'credible, verifiable and additional,' he added. 'Humanity has pulled off, even in the way of climate action, way more complication things that planting trees, or CCS, or renewables at scale,' Hoekstra said. Planting trees and deploying renewables are widely accepted solutions, especially in Europe, which lacks domestic fossil fuel reserves. Yet carbon capture and storage (CCS) remains controversial – and politically dormant in Brussels until recently. Now, the oil and gas industry, long a backer of CCS, is required under EU law to jointly develop infrastructure - typically using depleted gas fields - capable of permanently storing 50 million tonnes of CO2 a year from 2030. The idea is that with nowhere to store it, no one will invest in carbon capture technology. But industry players now say the target is unfeasible, prompting speculation that the Commission might revisit the rules as part of its regulatory 'simplification' push. Failing that, it might have to take action against petroleum firms for missing the target. Clear on tech neutrality 'Let's not run into hypotheticals now,' Hoekstra said, insisting the Commission maintains 'a completely neutral view' on which technologies will ultimately prevail. 'We very much embrace renewables. We also embrace nuclear,' he said. 'We embrace CCS,' he added, citing a €180 million EU-backed carbon capture project he recently visited in Sweden. The EU's climate chief also rejected claims that the Commission's efforts to reduce red tape amount to deregulation or the dismantling of the Green Deal. 'We are in one of the largest transitions, certainly in the domain of energy, that humanity has ever gone through,' he said. 'We have a very clear true north, and we're also very clear on our overall approach.' 'But does it then make sense to be pragmatic and to be street smart on the how? I think it does.' Acknowledging the cost of transition Hoekstra also acknowledged the scale of investment and social costs tied to the planned energy transition – the EU's decarbonisation agenda he now describes as a combination of 'a climate strategy, competitiveness strategy, and an independence strategy'. 'Let's not make the mistake of confusing costs with investments,' he added, pointing to the €400 billion Europe would still spend annually to import oil and gas 'even if you kick out the Russians'. 'This only happens if [there is] the predictability that pension funds and other large investors are looking for,' he said. Hoekstra rejected the idea that amending recently adopted laws through a series of 'omnibus' proposals would undermine that very predictability. Citing the EU's Carbon Border Adjustment Mechanism (CBAM) – the import tariff based on the carbon footprint of certain staple commodities – he noted that 90% of companies originally included had been removed from scope while it still captured 99% of emissions. 'Why did we include them in the first place?' Hoekstra asked. 'Couldn't it be true that our design was, maybe, good but not do you then choose?' 'Do you course keep running against the same wall all the time?' (de, jp)

U.S. ambassador expects Carney weighing growth options, including public service cuts
U.S. ambassador expects Carney weighing growth options, including public service cuts

Ottawa Citizen

time04-07-2025

  • Business
  • Ottawa Citizen

U.S. ambassador expects Carney weighing growth options, including public service cuts

Article content Pete Hoekstra, the United States ambassador to Canada, said that he thinks the prime minister is considering all aspects to create growth, including public service cuts. Article content The Ottawa Citizen sat down with Hoekstra at a picnic table outside the ambassador's residence. Small American flags rested in little buckets as workers scuttled to put the finishing touches on the annual Fourth of July party held on the lawn at the ambassador's house. Article content Article content Article content The party is one of the marquee events of the summer, with more than 1,000 attending with live music, food and more elbow-brush-schmoozing than ' elbows up.' Article content Hoekstra wore a red tie with cartoons of American faces instead of stars on the U.S. flag. The ambassador also spoke with a personable and disarming touch, but stayed firm on U.S. government priorities. Article content Article content When asked if Prime Minister Mark Carney would follow a similar program of slashing and cutting to improve government efficiency, similar to Elon Musk's Department of Government Efficiency, Hoekstra said he wouldn't speculate, but expects Carney is considering all avenues, including government clawbacks and cuts. Article content Still, even with public service cuts and other economic measures, Hoekstra does not think Carney will outpace U.S. economic growth. Article content Article content 'I'm disappointed that he won't meet that objective, because America will have a faster growth rate than Canada will have,' Hoekstra said. 'But I'd be excited if Canada was No. 2.' Article content Hoekstra argues that President Donald Trump's legislative victory around the passing of his so-called big, beautiful tax bill and cutting regulations will balloon growth despite critics, including inside the Republican party, worried about deficits. Article content The future of DOGE Article content Reflecting on the work of DOGE, he said that the work was precise, 'short-term focused emphasis' searching for waste. The difference now, he says, will be focused spending cuts through Congress rather than an outside government focus on those spending cuts. Article content He said the work and legacy of DOGE will go through Congress to pass spending rescission bills to put in law cuts and expenditures.

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