Harnessing the power of public activism for European Climate Action

Public activism within countries been a strength of European climate action so far. But non-state actors are each driven by their own priorities—and the challenge will be how to harness their energies while focusing these coherently in support of national and global climate strategies.

This blog reports on the closing session of a virtual conference, European Climate Action: Political Economy Challenges, hosted by the European Studies Centre of St. Antony’s College Oxford, on January 21, 2021, which considered how to engage non-state actors most effectively in climate action.

The panel included Philip Lymbery, Global CEO of Compassion in World Farming; Nick Mabey, CEO, E3G and Alex Clark, Smith School of Enterprise and the Environment, Oxford; it was chaired by Sir David Madden, St. Antony’s College. The conference was then closed by Charles Enoch, ESC Fellow and Head of EuPEP. Click here for the podcast of session 4 and closing remarks.

Investment in climate action—Governments and the private sector must work together

It has been clear for some time that the cost of investment needed in climate action is too great for the official sector alone to bear—and indeed it should not try to, given the profit opportunities for the private sector to invest in new areas. However, the financing landscape is complex, and rapidly evolving; likewise, the rules and boundaries of climate financing are just emerging and continue to shift.

This blog reports on the third session of a virtual conference, European Climate Action: Political Economy Challenges, hosted by the European Studies Centre of St. Antony’s College Oxford, on January 21, 2021, which considered the needs of the various financing players and their appropriate roles.

The panel included Josué Tanaka, Visiting Professor, Grantham Research Institute on Climate Change; Olaf Sleijpen, Executive Director of Dutch National Bank responsible for Climate Change; Isabelle Mateos y Lago, Managing Director, Blackrock; it was chaired by Professor Kalypso Nicolaidis, St. Antony’s College. Click here for the podcast of session 3.

Paying for the European Green Deal—Fiscal and social challenges

Climate action is expensive, and European budgets will be even more constrained in the coming decade by the fallout from covid-19. A key question for governments will be how to pay for climate-related reforms.

This blog reports on the second session of a virtual conference, European Climate Action: Political Economy Challenges, hosted by the European Studies Centre of St Antony’s College Oxford, on January 21, 2021, which tackled this difficult question.

The panel included Jean Pisani-Ferry, Senior Fellow at Bruegel and PIIE, Professor EUI; Dora Iakova, IMF, Assistant Director leading IMF work on European Climate Policies; and Linus Mattauch, Martin School, Oxford; it was chaired by Professor Tim Vlandas, St Antony’s College. Click here for the podcast of session 2.

Europe and COP26—Contribution and expectations

By its early commitment to the European Green Deal, the EU has taken on a lead role in the coming round of climate negotiations, COP26 in Glasgow in November 2021. Next questions are: what it will take, beyond the Green Deal, to make the COP a true success, and then, what it will take for Europe to implement the Green Deal successfully.

This blog reports on the first session of a virtual conference, European Climate Action: Political Economy Challenges, hosted by the European Studies Centre of St. Antony’s College Oxford, on January 21, 2021, which considered these questions.

The panel included Mauro Petriccione, Director General for Climate, European Commission; Emmanuel Guérin, Executive Director, European Climate Foundation; and Heidi Hautala, Vice-President, European Parliament; it was chaired by Professor Thomas Hale, Blavatnik School of Government. Click here for the podcast of this session (which begins at 10.38 after opening remarks).

The fight against climate change is a political economy challenge for Europe and for COP26

Two climate-action milestones are about to shape our future, and social scientists need to be engaged.

• COP26, the next global climate summit, will take place in Glasgow in November 2021. It will stocktake the adequacy of world efforts to contain global warming, and seek commitments from countries to strengthen the ambition of their strategies to cap warming at ‘well below 2 degrees Celsius’. 

• The European Green Deal, the most comprehensive international commitment so far toward combatting climate change, will be a key input to the COP…but not enough by itself to meet the targets necessary for the COP to be a success. Moreover, implementing the Green Deal will require a massive socio-economic transformation of Europe over the coming decade.

A virtual conference, European Climate Action: Political Economy Challenges, discussed the implications of these milestones, asking what will it take—beyond Europe’s Green Deal—to make the COP a true success, and then, what will it take for Europe to implement the Green Deal successfully. The findings are summarized in a sequence of blogs, starting with this overview. The conference programme and a combined report can be accessed on the EuPEP website, with links to podcasts by session.

Regional disparities in Europe: The economic impact of Covid-19

This webinar, held on November 23, 2020 was convened by the European Political Economy Project

Gergely Hudecz (on the staff of the European Stability Mechanism) presented the results of research, undertaken with Edmund Moshammer and Thomas Wieser, on the evolution of disparities across European sub-national regions, over the medium term and in response to the COVID-19 crisis. (Detailed results are available in Hudecz, G., Moshammer, E. and Wieser, T. (2020), “Regional disparities in Europe: should we be concerned?” ESM Discussion Paper 13.) They look at income and employment in individual regions, investigating what factors have contributed to relatively good performance and where there has been convergence or divergence. On this basis they offer suggestions on what policies might be effective in helping weaker regions catch up and share in the benefits of integration.

Regarding developments since the turn of the century, they find a complex picture: there has been a tendency for relatively poor countries to grow relatively quickly, and in particular the “new” EU member states have converged towards the mean. However, performance differences within countries have been pronounced, not least in the “old” member states. The differences do not fall into a simple urban/rural or north/south divide. Rather, the ex-urban areas surrounding vibrant metropolitan centres seem to have been most successful in attracting well-paying jobs in expanding, knowledge-based sectors. The research suggests that education levels and also the quality of local administration contribute to regional success, as does labour force flexibility, but no one factor is sufficient in itself: investment in education, for example, may facilitate emigration if attractive local jobs are not available. A weak region risks entering a vicious circle of poor growth, emigration, and lack of resources for public goods such as human capital, infrastructure, and efficient administration.

ECB debt certificates: The available euro safe asset

 This webinar is convened by the European Political Economy Project

On 2 November 2020, EuPEP hosted a European Studies Seminar series webinar on Daniel Hardy’s proposal for the ECB to issue debt certificates (The underlying paper is available at https://www.economics.ox.ac.uk/materials/working_papers/5342/ecb-debt-certificates-v9.pdf). The event, chaired by Tim Vlandas, brought together the two main agencies that could be involved in such an innovation, with Demosthenes Ioannou from the ECB and Gabriel Giudice from the European Commission acting as discussants.

The development of an EU-level safe asset is a key building block for the capital markets union, which in turn is a priority for strengthening EU architecture and preventing a repeat of Europe’s debt crisis. Hardy’s proposal for ECB debt certificates would create a safe asset with many attractive characteristics, while avoiding many of the objections that have impeded the creation of such an asset in the past. Specifically, Hardy recommends that the ECB regularly issue a large volume of liquid short-term financial paper, along the lines of US T-bills, which might be called “euro liquidity management instrument” (or ELIs).

Currently, the EU has no region-wide financial instrument akin to T-bills, meaning that banks with excess liquidity have few alternatives to piling up large deposits at the ECB, and euro investors and liquidity managers are short of best-quality, usable collateral. The creation of ELIs would give banks more flexibility and would expand the capital market beyond banks by giving investors a new euro-denominated security. Its short maturity (Hardy proposes six months), and capacity for the ECB to issue it in large volume (Hardy envisages an eventual stock of 1.3 trillion euro), would make it safe, liquid, and desirable. Its existence would create a new source of high-quality collateral and help stabilize risk premia across the EU financial system. All of these attributes would enable the euro to expand its role in global financial markets.