A group of European companies say they are “supportive” of a moratorium on environmental laws

A group of European companies say they are “supportive” of a moratorium on environmental laws

As the signs of recession become more apparent every day, BusinessEurope, the EU employers’ association, has called on the European Commission to reconsider the environmental legislation that is currently being drafted and to press for the “one in, one out” principle be applied more strictly.

In unveiling its economic outlook for summer 2022 last week (7 July), BusinessEurope sounded the alarm: the EU “Facing a very difficult time”characterized by high energy costs and the war in Ukraine that threaten to push the economy into recession.

“We are heading into a very difficult situation”said Fredrik Persson, a Swedish business leader who took over from Pierre Gattaz as president of BusinessEurope on July 1 for a two-year term.

“I have never been faced with such uncertainties in my entire career”said the entrepreneur, a member of the board of six companies, including white goods maker Electrolux and the holding company of Swedish furniture giant Ikea, Interogo Holding AB.

The economy of the European Union is increasingly threatened. Last week, the euro hovered near a two-decade low against the dollar, as squeezing energy costs in Europe cast a shadow over the bloc’s economic outlook.

BusinessEurope’s latest economic forecasts predict a growth rate of 2.6% for 2022, which represents “a drop of 1.3%” compared to its previous fall forecast.

“However, growth in the year 2022 is expected to be only 0.6%, suggesting that some member states may experience at least ‘technical recessions’ in the year 2022”warned the association in a press release.

Faced with the risk of recession, the EU employers’ association calls on policymakers not to adopt environmental legislation in order to ease the pressure on European businesses.

“We should be careful not to increase the regulatory burden in these difficult times”said Mr Persson, reminding the European Commission to “always check competitiveness” before putting new laws on the table.

And if the EU executive decides to legislate, it should strictly adhere to its “one in, one out” principle, whereby new rules are balanced by the removal of equivalent regulatory constraints in the same policy area, Mr Persson continued. .

“And if you can do ‘one for one’, honestly you can do ‘one for two’”he added.

In Parliament, the EPP calls for a moratorium on regulation

In the European Parliament, Conservative lawmakers have taken this logic a step further by calling for a “regulatory moratorium” with regard to environmental legislation after the EU adopted the current ‘Fit for 55’ climate legislative package.

Christian Ehler, a German MEP from the European People’s Party (EPP), said it was a request “recurring” of the EPP in talks with the European Commission, the EU body that has the exclusive right to introduce legislation on behalf of the bloc.

“We have asked the Commission to consider a regulatory moratorium” for certain industrial sectors until 2030, Mr Ehler told reporters during a press conference on June 15 on the reform of the EU’s carbon market, the emissions trading system (ETS ).

“We must adapt to the realities of the industry”he said, calling on the EU executive to carry out economic impact studies for specific sectors such as plastics or chemicals, which are directly affected by EU climate laws.

Mr Ehler insisted that European industry supports the green transition, with many companies already leading the way and seeing the change as an opportunity.

“But what the industry has asked us to do is make [la transition écologique] achievable” for them and to give them “a space to invest”added the German MEP, saying that European companies are facing unprecedented uncertainties.

“We are in a Bermuda triangle of challenges: on the one hand, we want a transformative change in our economy in Europe to achieve our CO2 reduction ambition. And on the other hand, we are faced with war. And third, we are still in the throes of a post-Covid economic crisis, where global markets are disrupted and supply chains are still not working”explained Mr. Ehler.

Against this backdrop of uncertainty, Mr Ehler said the EPP’s aim was to “to enable industry and the economy to achieve” the EU’s ecological objectives.

No additional charge

BusinessEurope calls for there to be no more “bureaucracy or additional burden”.

Mr. Ehler’s remarks echo a prevailing sentiment at BusinessEurope.

Businesses across the EU are currently facing a “shortage of components”Has “damaged supply chains” after the Covid, as well as at the risk of seeing a “harmful wage-price spiral” caused by inflation, Mr. Persson warned.

Given the current uncertainty, “I don’t think there is a single meeting room where investments are not reconsidered”he pointed out.

Markus J. Beyrer, Managing Director of BusinessEurope, was more blunt: “We should not impose bureaucracy or additional burden when it is not necessary, in a situation where companies are in difficulty”.

Yet the EU employers’ organization has not officially endorsed the EPP’s call for a regulatory moratorium on EU environmental laws. “We, BusinessEurope, have no position to say that we formally support this EPP moratorium”Beyrer told EURACTIV.

“But we are certainly in favor of this idea”he added.

Mr Beyrer cited the revision of the Industrial Emissions Directive as an example of unwelcome regulation. “Why does this fall on our heads, creating insecurity, when we don’t need it? » he asked.

“It comes at the wrong time and will inevitably make industrial activities more complex at a time when we need the opposite”the group said in a statement released earlier this year.

Another example is the upcoming revision of the REACH (Registration, Evaluation, Authorization and Restriction of Chemicals) regulation on chemicals. According to BusinessEurope, this regulation will not only affect the chemical industry, but also “many downstream sectors that depend on chemicals, such as transport, electronics or textiles”.

“Obviously there is the big question of whether this is necessary at the present time”Mr. Beyrer said.

The way the review of the REACH regulation is carried out could have far-reaching consequences for European businesses, he warned. “That could mean you take 12,000 chemicals off the market, but it could also mean it’s 1,500 or 1,100. very difficult. »

“So if you ask me, maybe now is not the best time to come up with such a piece of legislation”he added.

BusinessEurope aligned with EU strategy?

Yet BusinessEurope rejects any suggestion that it opposes the EU’s environmental strategy, which Commission President Ursula von der Leyen has presented as the “new growth strategy” from Europe.

“We fully support the Green Deal, we fully support the ambition[écologique]»said Mr. Beryrer. “But we need to find a way to do this to decarbonize Europe without deindustrializing it. »

“I honestly think corporations are ahead of politicians in a lot of ways now. And I see businesses transforming at a very rapid pace.”added Mr Persson when asked for his opinion on the EU’s climate targets for 2030.

Despite this, BusinessEurope’s support for the EU’s climate agenda has probably not been very enthusiastic.

When the EU executive presented more ambitious climate targets for 2030 two years ago, the employers’ association questioned “value and credibility” of the economic analysis underlying the proposal.

Two years earlier, an internal memo revealed that the association planned to ” to oppose “ to any reinforcement of the EU’s climate ambition for 2030 by “using traditional arguments” that Europe must first rally China and the United States before taking action “unilateral” in terms of climate policy.

The EPP campaign

Since then, BusinessEurope has tempered its opposition to climate policy. However, the EPP seems to have picked up the slack by making it clear that the moratorium on EU environmental laws was going to be a recurring theme for them.

“This will now be the ongoing work of the EPP”after the adoption of the ‘Fit for 55’ legislative package, said Esther de Lange, a Dutch Christian Democrat MEP who spoke alongside Christian Ehler at the June press conference.

“Ecology is not just about writing goals into legislation” she said, insisting that EU climate legislation “does not happen in a vacuum”and has important implications for businesses.

She added that Europe also needed “an industrial policy that makes sense and that allows the cleanest and most innovative industries to stay in Europe and continue to create jobs”.

“The EPP will be lobbying the European Commission on this, so it’s not the last time you’ll see us, I’m afraid”said Ms. de Lange.

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