Diplomacy & Defense Think Tank News

Le Centre Georges Pompidou à Paris organise son Festival 'Hors Pistes' qui porte sur l'art contemporain et traite de sujets d'actualité. Cette année, il se tient en ligne jusqu'au 14 février avec pour thème "Peut-on imaginer et pratiquer une écologie des images ?".

L'Opéra de La Monnaie à Bruxelles reprend ses concerts et opéras, sans public mais diffusés sur son site. Le mois de février est entièrement consacré à Mozart.

Le Grand théâtre du Liceu de Barcelone propose du 6 au 9 février le spectacle de danse "Solstice", créé par la chorégraphe Blanca Li. Ce spectacle évoque les bouleversements de notre écosystème et la dégradation de la nature, exprimé à travers la danse.

Du 8 au 14 février se tient Das Filmfest, festival de films en langue allemande organisé par l'institut Goethe de Prague et le forum culturel autrichien de Prague pour faire découvrir la culture allemande aux Tchèques. Cette année, l'édition se déroule en ligne et accessible à tous en raison de la pandémie et propose une sélection de 7 films d'Allemagne, d'Autriche et de Suisse. Chaque soir à 19h, un film est mis en ligne et accessible pour 48 heures.

De nombreux musées en Italie ont rouvert leurs portes le 1er février, dont les musées du Vatican et la Chapelle Sixtine, la Galerie des Offices à Florence, le site de Pompéi et son Antiquarium rénové, les Musées Royaux de Turin ainsi que le Colisée de Rome. La Galerie de l'Académie à Venise rouvrira le 8 février.

The departure of the United Kingdom and the prospect of an independent Scotland seeking membership raise fundamental questions concerning the European Union’s future size, geography and polity. Germany’s policy on Europe is traditionally guided by the idea that enlargement and deepening are two sides of the same coin. In reality progress on integration has never matched the pace of (eastern) enlargement. The road to the 2009 Lisbon Treaty was rough, and the spectre of failure haunts any dis­cussion of deeper reforms, especially those requiring changes to the treaties by unanimity. The Scottish question has the potential to energise enlargement policy and spur in­ter­nal reforms – to prepare not just for a new 28th member, but for an EU-34.

It was agreement almost at the last minute: The Trade and Cooperation Agreement (TCA) between the European Union (EU) and the United Kingdom (UK), signed on 30 December 2020, prevented a no-deal Brexit just one day before the end of the transition period. Four and a half years after the referendum, relations between the EU and its former member state have thus been put on a new footing. It is a considerable achievement of the negotiators on both sides that such a complex agreement was reached despite the adverse conditions.

Yet, the end result, due to the British quest for sovereignty, is a (very) hard Brexit. Although the movement of goods will continue with zero tariffs and zero quantitative restrictions, many new non-tariff trade barriers will arise when compared to single market membership. (Financial) services are largely excluded from the treaty, and with very few exceptions, the British are leaving European projects such as Erasmus. London has also excluded foreign and security policy altogether from the institutional cooperation with the EU. Despite the restricted market access, the EU can claim to have achieved the inclusion of comprehensive instruments to ensure fair competition (“level playing field”). This includes the possibility of reintroducing tariffs and other trade restrictions should there be a significant divergence in labour or environmental standards in the future. And so both sides have achieved their remarkably defensive goals: Boris Johnson gets his hard Brexit, and the EU was able to defend its single market and its standards.

An agreement to be built upon

The original idea of an “ambitious and deep partnership” between the EU and the UK, however, has fallen by the wayside. In the first few weeks of 2021, the EU and the UK have already squabbled over vaccines and the status of the EU ambassador in London. Nevertheless, if used wisely, the agreement could represent the low point in British-European relations, from which a new partnership emerges after the difficult Brexit negotiations. For five reasons, the TCA could enable an improvement in relations:

First, the trade deal does not mark the end of negotiations between London and Brussels. The agreement itself provides for a review after five years – that is, just under six months after the likely date of the next UK general elections – in the course of which relations can also be deepened again. There is also a review clause for the Northern Ireland Protocol in 2024, transition periods for energy cooperation and fisheries, and further talks on data exchange and financial market services in 2021. Similar to Switzerland, there will thus be almost constant negotiations between the EU and the UK, albeit at a less politically dramatic level than recently. It is precisely this de-dramatisation of relations that offers an opportunity to restore trust and improve cooperation.

Second, the agreement is designed to be built upon. It establishes institutionalised cooperation between London and Brussels with an EU-UK Partnership Council and a number of specialised committees, for example on trade in goods, energy cooperation, and British participation in EU programmes. It is explicitly designed as an “umbrella agreement” into whose overall institutional framework further supplementary agreements can be inserted.

A continued interdependence

Third, economic relations will remain important for both sides, despite new trade restrictions. The geographical proximity, the close integration of supply and productions chains in many economic sectors, and the mutual importance in trade will ensure continued economic interdependence. The EU remains by far the largest export market for the UK, which in turn, as the second biggest economy in Europe, will also continue to be a major economic partner (and competitor) for the Union. Added to this are the level playing field provisions of the TCA, with which both partners commit to maintaining existing EU standards, as far as they affect trade and investments, and incentives have been created to keep pace with new standards.

Fourth, the willingness of both sides to make compromises to avoid a no-deal Brexit paradoxically also clearly revealed the common interests, despite the difficult divorce. For example, the TCA declares climate policy to be a shared interest, in which the UK will play a central role in 2021 by hosting the next climate summit, together with Italy. Opportunities will also present themselves here for trilateral cooperation with the new US administration. The continued participation of the British in a small number of EU programmes, such as the EU’s Copernicus Earth observation programme and parts of the data exchange in home affairs and justice policy, is also stronger than expected.

Northern Ireland as a common task

Fifth, with the combination of the Withdrawal Agreement and the TCA, Northern Ireland has become a shared responsibility of the UK and the EU. In order to keep the border open with the EU member state of the Republic of Ireland, the rules of the EU single market will continue to apply in Northern Ireland, whereas a trade border has been created in the Irish Sea between Northern Ireland and the rest of the UK. Any deviation from EU standards will now require the UK government to weigh not only whether this breaks the level playing field rules  – thus allowing the EU to erect trade barriers – but also whether new intra-UK trade barriers with Northern Ireland are created. The EU equally has a responsibility in the interests of its member state Ireland to work with the British government to ensure that these complex arrangements work as smoothly as possible so as not to jeopardise peace in Northern Ireland.

The trade treaty, which came into being under great time as well as political pressures, thus achieves one thing above all – the creation of a foundation on which British-European relationship can be reconstructed. Hard Brexit is now a fact, and the step from EU membership to a third country with a trade agreement has been completed. But negotiations are from over – as neighbours, the EU and the UK will continue to negotiate and renegotiate their relationship in the foreseeable future. It is now up to the political leadership on both sides to determine how this foundation is used. The EU and Germany should be open to building on this foundation with options for deepening cooperation in areas where there were gaps left behind by the TCA due to time or political circumstances.

This text was also published at fairoberserver.com.

Peacekeeping mission mandates now routinely include language on women, peace, and security (WPS). Despite this progress, negotiations in the Security Council on the inclusion of WPS language in mandates have at times been contested, and it is not always clear that more detailed or “stronger” language on WPS in mandates translates to changes in peacekeeping missions. The language included in mandates can even perpetuate stereotypes, including the assumption that every uniformed woman is responsible for implementing a mission’s WPS mandate.

This paper explores the different elements of the WPS agenda that are included in peacekeeping mandates, assesses the factors that influence the inclusion of language on WPS, examines the drivers behind the implementation of the WPS agenda in the field, and assesses the impact that mandate language has on uniformed women peacekeepers. It concludes by considering how the Security Council and other stakeholders could advance the WPS agenda through mission mandates, including by:

• Proposing WPS language early in the Security Council’s mandating process;
• Facilitating engagement between country experts and WPS experts in member states’ permanent missions to the UN;
• Using informal consultations to understand the needs of women affected by conflict;
• Including language in mandates that reflects the contributions of both women and men to operational effectiveness; and
• Ensuring that approaches to WPS in the Security Council consider the full spectrum of gender.

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Iliana Olivié, Emma Carrasco y María Moreno. ARI 13/2021 - 29/1/2021

España coincide en distintos espacios multilaterales o supra-nacionales de desarrollo con un grupo reducido de donantes de la UE con los que además concuerda en una visión relativamente común del sistema multilateral. Éstos podrían ser sus principales aliados en su estrategia de fortalecimiento del sistema multilateral de desarrollo en la etapa post-COVID-19.

The proposal for a European Health Union is currently being discussed by the Council of the European Union and includes the strengthening of the European Centre for Dis­ease Prevention and Control (ECDC) as well as the extension of its mandate. In light of this, the ECDC and the European Union (EU) member states can make the case for a new role for the ECDC. While the political weight of the member states is needed, the ECDC can seize the opportunity of expanding its regional and bilateral partnerships to promote health systems strengthening through development projects. In doing so, the ECDC would be contributing to sustainable development and the 2030 Agenda.

Félix Arteaga. ARI 12/2021 - 28/1/2021

El Gobierno va a actualizar la Estrategia de Seguridad Nacional en 2021. La reflexión estratégica que se inicia, ¿servirá sólo para mejorar la atención que se presta a los riesgos habituales para la seguridad (luces cortas), o se abrirá a explorar nuevos escenarios de riesgo para la prosperidad (luces largas)?

An important anniversary is coming up in the Kingdom of Denmark: 12 May 2021 marks exactly three hundred years since the Protestant preacher Hans Egede set sail, with the blessing of the Danish monarch, to missionise the island of Greenland. For some Greenlanders that date symbolises the end of their autonomy: not a date to celebrate but an occasion to declare independence from Denmark, after becoming an autonomous territory in 2009. Just as controversial as Egede’s statue in the capital Nuuk was US President Donald Trump’s offer to purchase the island from Denmark. His arrogance angered Greenlanders, but also unsettled them by exposing the shaky foundations of their independence ambitions. In the absence of governmental and economic preconditions, leaving the Realm of the Danish Crown would appear to be a decidedly long-term option. But an ambitious new prime minister in Nuuk could boost the independence process in 2021.

Candida Splett: Im Zuge der Corona-Pandemie sind durch Grenzschließungen und Produktionseinbrüche Lieferketten unterbrochen worden. Was hat das ausgelöst?

Melanie Müller: Vielen Ländern ist bewusst geworden, wie abhängig sie von Lieferbeziehungen sind, sei es beim Import oder beim Export. Und auch die zentrale Rolle Chinas als Zwischenhändler in den globalen Lieferketten ist in den Fokus gerückt. In vielen Staaten, auch in der EU, denkt man nun darüber nach, wie man diese Abhängigkeiten reduzieren und damit die Versorgungssicherheit erhöhen kann.

Heißt das, dass wir die Globalisierung zurückfahren müssen?

Das ist in den meisten Bereichen nicht realistisch. Ein Beispiel: Wir wissen bereits jetzt, dass sich durch die zunehmende Digitalisierung und auch die Energiewende der Bedarf an bestimmten metallischen Rohstoffen in den nächsten Jahren weiter erhöhen wird. Dieser Bedarf kann nicht über Recycling allein gedeckt werden. Da Deutschland selbst keine metallischen Rohstoffe in relevanter Größenordnung abbaut, muss es sie importieren. Umgekehrt sind viele Länder des globalen Südens dringend auf den Export angewiesen, Südafrika etwa als Hauptproduzent von Platin, das in der Automobilindustrie eingesetzt wird. Ohne diese Exporte würden dem Land wichtige Einnahmen verloren gehen. In afrikanischen Staaten wird allerdings darüber diskutiert, wie man die Wertschöpfung vor Ort erhöhen kann, indem man Rohstoffe nicht nur abbaut, sondern selbst weiterverarbeitet. So könnten sie sich unabhängiger vom Export machen.

Was sind die wichtigsten Schritte auf dem Weg zu mehr Versorgungssicherheit in der EU, wenn man auf die Lieferketten schaut?

Nicht die einzelnen Nationalstaaten, sondern die EU muss sich dem Thema Versorgungssicherheit nähern, und zwar mit einer mittel- bis langfristigen Perspektive. Dabei geht es nicht nur um eine Diversifizierung von Lieferketten, sondern auch darum, sie menschenrechtskonform bzw. sozial- und umweltfreundlich zu gestalten. Denn Störungen in Lieferbeziehungen entstehen nicht nur in Pandemien, sondern auch durch politische Unruhen oder durch die Verletzung von sozialen oder Umweltstandards, die zum Beispiel zu Streiks führen können. Ebenso können Umweltprobleme Produktionskosten erhöhen – etwas, das uns als Abnehmer auf die Füße fällt. Wenn wir uns nun also mit der Widerstandsfähigkeit von Lieferketten beschäftigen, sollten wir auch die Situation im globalen Süden in unsere Strategien mit einbeziehen.

Was muss nun also geschehen?

In den letzten zehn Jahren hat sich schon viel getan: Dass in der EU und in Deutschland heute über Lieferkettengesetze diskutiert wird, ist das Resultat einer längeren Entwicklung. Die Vereinten Nationen etwa haben 2011 bereits Leitprinzipien für Wirtschaft und Menschenrechte verabschiedet, die OECD setzt schon länger entsprechende Standards. Entscheidend ist, dass wirtschaftliche Akteure nicht mehr nur für das Handeln im eigenen Unternehmen verantwortlich gemacht werden. Sie sollten vielmehr gesetzlich verpflichtet werden, sich mit der Menschenrechtslage in Zulieferbetrieben und deren staatlichem Umfeld zu beschäftigen.

Was steht einer Einigung über das deutsche und das europäische Lieferkettengesetz noch im Wege?

Da geht es um Fragen wie: Welche Unternehmen sollen in die Pflicht genommen werden, müssen Unternehmen sich eine Menschenrechtsagenda geben, wer evaluiert deren Erfolg und werden die Berichte der Öffentlichkeit zugänglich gemacht? Das ist eine ganze Reihe technischer Fragen, die enorme politische Implikationen haben. Streit gibt es auch über das Verhältnis des deutschen zum europäischen Lieferkettengesetz. Manche sagen, wir brauchen das europäische Gesetz zuerst. Ich meine, dass Deutschland sich bereits jetzt einen gesetzlichen Rahmen geben sollte. Wir sind ein zentraler politischer Akteur in der EU und können Vorreiter sein. Sollte die EU-Verordnung dann weitreichender ausfallen, können wir nachbessern.

Worauf kommt es bei der Umsetzung des Lieferkettengesetzes an?

Die Unternehmen müssen mehr darüber lernen, worauf sie konkret achten müssen. Wie kann man überprüfen, ob in einem Land Rechtsbrüche stattfinden, was kann ich überhaupt nachvollziehen und was nicht? In unserem Projekt »Transnationale Governance-Ansätze für nachhaltige Rohstofflieferketten im Andenraum und im südlichen Afrika« untersuchen wir Lieferketten, die zum Teil so intransparent sind, dass die Endabnehmer sie nur schwer nachvollziehen können: In einer Weltregion wird das Metall abgebaut, in der nächsten geschmolzen, in einem Land in Europa wird daraus dann vielleicht ein Draht hergestellt, der im nächsten Land in ein Produkt eingebaut wird. An jeder der zahlreichen Stufen der Bearbeitung kann es zu Menschenrechtsverletzungen kommen. Das ist selbst bei einfacheren Produkten wie Computermäusen kaum nachvollziehbar. In unserem Projekt wollen wir komplexe Lieferketten bei metallischen Rohstoffen zunächst nachvollziehen, um dann Vorschläge machen zu können, wie sie transparenter und vor allem nachhaltiger gestaltet werden können. Die Transparenz ist also ein wichtiges Ziel. Und schließlich müssen wir Staaten, von denen wir wissen, dass dort regelmäßig Menschenrechte verletzt werden, dazu bewegen, das Problem einzudämmen.

Inwieweit engagieren sich Staaten des globalen Südens bereits für nachhaltige Produktionsprozesse?

Der Erkenntnisprozess ist bereits da, viele Staaten im globalen Süden haben eigene Verpflichtungen und Regelungen verabschiedet. Zudem gibt es eine lebhafte Zivilgesellschaft, die sich genau dafür einsetzt, und auch einen von Ecuador und Südafrika angestoßenen Prozess auf UN-Ebene mit dem Ziel eines »Binding Treaty on Business and Human Rights«. Einige Länder haben allerdings Angst, Wettbewerbsvorteile einzubüßen, wenn sie nicht so billig wie möglich produzieren. Dabei vergessen sie, dass auch schlechte Produktionsbedingungen häufig Kosten verursachen.

Was kann Deutschland tun, um sie zu unterstützen?

Wir können Staaten und Firmen vor Ort direkt dabei unterstützen, bestehende Regelungen umzusetzen, ebenso wie zivilgesellschaftliche Akteure, die auf Missstände aufmerksam machen. Man kann auch helfen, die Informationsbasis zu verbessern. Und schließlich ist Prävention wichtig: Wenn zum Beispiel eine neue Mine eröffnet werden soll, kann man von vornherein darauf achten, Risiken abzuschätzen und zu reduzieren. Da geht es zum Beispiel darum, die relevanten Institutionen und Verwaltungen in den Ländern zu stärken oder Korruption im Rohstoffsektor einzudämmen.

Melanie Müller leitet das Projekt »Transnationale Governance-Ansätze für nachhaltige Rohstofflieferketten im Andenraum und im südlichen Afrika«.

Das Interview führte Candida Splett von der Online-Redaktion der SWP.

Ondanks recente economische groei in veel Afrikaanse ontwikkelingslanden, en zowel overheidsinterventie op nationaal niveau en grootschalige ondersteuning op internationaal niveau, blijft structurele transformatie van deze economieën grotendeels uit. Een groot deel van de productie, handel en investeringen blijft geconcentreerd in lage value-added activiteiten die weinig werkgelegenheid genereren. In dit artikel laat Kasper Vrolijk zien dat dit komt omdat overheden in deze landen industriepolitiek inzetten om output te verhogen, maar innovatie en technologieoverdracht daarbij onvoldoende benadrukken.

Ondanks recente economische groei in veel Afrikaanse ontwikkelingslanden, en zowel overheidsinterventie op nationaal niveau en grootschalige ondersteuning op internationaal niveau, blijft structurele transformatie van deze economieën grotendeels uit. Een groot deel van de productie, handel en investeringen blijft geconcentreerd in lage value-added activiteiten die weinig werkgelegenheid genereren. In dit artikel laat Kasper Vrolijk zien dat dit komt omdat overheden in deze landen industriepolitiek inzetten om output te verhogen, maar innovatie en technologieoverdracht daarbij onvoldoende benadrukken.

Ondanks recente economische groei in veel Afrikaanse ontwikkelingslanden, en zowel overheidsinterventie op nationaal niveau en grootschalige ondersteuning op internationaal niveau, blijft structurele transformatie van deze economieën grotendeels uit. Een groot deel van de productie, handel en investeringen blijft geconcentreerd in lage value-added activiteiten die weinig werkgelegenheid genereren. In dit artikel laat Kasper Vrolijk zien dat dit komt omdat overheden in deze landen industriepolitiek inzetten om output te verhogen, maar innovatie en technologieoverdracht daarbij onvoldoende benadrukken.

Die »Takfiristen« sind eine stark sektenartige Strömung des Jihadismus, deren An­hänger glauben, dass fast alle Muslime außer ihnen selbst ungläubig sind. Aufgrund ihrer geringen Zahl hatten viele von ihnen die Hoffnung aufgegeben, einen erfolg­reichen »Jihad« gegen die Feinde des Islam führen zu können. Dies änderte sich mit der Ausrufung des Islamischen Staates (IS) im Juni 2014, als viele Takfiristen aus Europa, den Kaukasusländern, Saudi-Arabien und Nordafrika nach Syrien und in den Irak zogen und sich dem IS anschlossen – während andere diesen Schritt ablehnten, auf den bewaffneten Kampf verzichteten und in ihren Heimatländern blieben. Seit­dem stellt sich die Frage nach der Gefährlichkeit der Takfiristen erneut. Der Anschlag in Wien am 2. November 2020 hat der Debatte neue Nahrung verschafft, denn der Attentäter verkehrte vor seinem Ausreiseversuch nach Syrien im Jahr 2018 in einer takfiristischen Moschee in der österreichischen Hauptstadt. Er ist das jüngste Beispiel dafür, dass die Takfiristen ein integraler Bestandteil der jihadistischen Bewegung sind und eine teils unterschätzte Gefahr darstellen.

To avoid catastrophic effects on natural and human systems, bold action needs to be taken rapidly to mitigate climate change. Despite this urgency, the currently implemented and planned climate mitigation policies are not sufficient to meet the global targets set in Paris in 2015. One reason for their current inadequate rollout is their perceived negative distributional effects: by increasing the price of goods, climate mitigation policies may increase both poverty and inequality. In addition, they may disrupt labour markets and increase unemployment, especially in sectors and areas dependent on fossil fuels. As a result, public protests in many countries have so far blocked or delayed the implementation of climate policies.
New avenues of research, discussed in this Briefing Paper, are turning the tide. First, it has been shown that carbon pricing may not be regressive in developing countries, contrary to the evidence in advanced economies. In a similar positive direction, findings from global-level and cross-country studies assessing the effects of climate mitigation policies on labour markets estimate that reaching climate goals will actually generate a small net increase in jobs. Nonetheless, the price effect of carbon pricing and the impact on the labour market of climate policies will both create losers: increases in prices would worsen poverty as lower-income households would need to pay more to purchase the same goods; similarly, specific countries, sectors, areas and workers (such as low-skilled ones) will witness job disruption or loss.
Second, social protection policies can be implemented to compensate households and workers negatively affected by climate policies and to address negative distributional effects. Compensation for higher prices can be achieved through the use of cash transfers to households, which can be funded by revenues from climate policies such as carbon taxes. Full compensation can be achieved by using only a small share (about 30%–50% according to case studies) of the tax revenues generated. The remaining share could be used for other purposes, such as climate-friendly investments. Similarly, when looking at labour market effects, social protection, especially labour market policies such as retraining and unemployment relief, become critical in addressing the needs of negatively affected workers.
Clearly, the achievement of environmental and social goals need not be mutually exclusive. With appropriate policy mixes, both poverty and environmental degradation can be reduced. This policy implication needs to be communicated more widely to increase the acceptance of climate polices. This is partially already achieved by recent plans such as the European Green Deal. From a research and policy perspective, more studies in developing countries are needed, including evidence on non-market climate policies and extending beyond the short-term effect of higher prices on the purchasing power of households. Finally, international cooperation can play an important role in policy coordination, financing and building social protection systems in lower-income countries.

To avoid catastrophic effects on natural and human systems, bold action needs to be taken rapidly to mitigate climate change. Despite this urgency, the currently implemented and planned climate mitigation policies are not sufficient to meet the global targets set in Paris in 2015. One reason for their current inadequate rollout is their perceived negative distributional effects: by increasing the price of goods, climate mitigation policies may increase both poverty and inequality. In addition, they may disrupt labour markets and increase unemployment, especially in sectors and areas dependent on fossil fuels. As a result, public protests in many countries have so far blocked or delayed the implementation of climate policies.
New avenues of research, discussed in this Briefing Paper, are turning the tide. First, it has been shown that carbon pricing may not be regressive in developing countries, contrary to the evidence in advanced economies. In a similar positive direction, findings from global-level and cross-country studies assessing the effects of climate mitigation policies on labour markets estimate that reaching climate goals will actually generate a small net increase in jobs. Nonetheless, the price effect of carbon pricing and the impact on the labour market of climate policies will both create losers: increases in prices would worsen poverty as lower-income households would need to pay more to purchase the same goods; similarly, specific countries, sectors, areas and workers (such as low-skilled ones) will witness job disruption or loss.
Second, social protection policies can be implemented to compensate households and workers negatively affected by climate policies and to address negative distributional effects. Compensation for higher prices can be achieved through the use of cash transfers to households, which can be funded by revenues from climate policies such as carbon taxes. Full compensation can be achieved by using only a small share (about 30%–50% according to case studies) of the tax revenues generated. The remaining share could be used for other purposes, such as climate-friendly investments. Similarly, when looking at labour market effects, social protection, especially labour market policies such as retraining and unemployment relief, become critical in addressing the needs of negatively affected workers.
Clearly, the achievement of environmental and social goals need not be mutually exclusive. With appropriate policy mixes, both poverty and environmental degradation can be reduced. This policy implication needs to be communicated more widely to increase the acceptance of climate polices. This is partially already achieved by recent plans such as the European Green Deal. From a research and policy perspective, more studies in developing countries are needed, including evidence on non-market climate policies and extending beyond the short-term effect of higher prices on the purchasing power of households. Finally, international cooperation can play an important role in policy coordination, financing and building social protection systems in lower-income countries.

To avoid catastrophic effects on natural and human systems, bold action needs to be taken rapidly to mitigate climate change. Despite this urgency, the currently implemented and planned climate mitigation policies are not sufficient to meet the global targets set in Paris in 2015. One reason for their current inadequate rollout is their perceived negative distributional effects: by increasing the price of goods, climate mitigation policies may increase both poverty and inequality. In addition, they may disrupt labour markets and increase unemployment, especially in sectors and areas dependent on fossil fuels. As a result, public protests in many countries have so far blocked or delayed the implementation of climate policies.
New avenues of research, discussed in this Briefing Paper, are turning the tide. First, it has been shown that carbon pricing may not be regressive in developing countries, contrary to the evidence in advanced economies. In a similar positive direction, findings from global-level and cross-country studies assessing the effects of climate mitigation policies on labour markets estimate that reaching climate goals will actually generate a small net increase in jobs. Nonetheless, the price effect of carbon pricing and the impact on the labour market of climate policies will both create losers: increases in prices would worsen poverty as lower-income households would need to pay more to purchase the same goods; similarly, specific countries, sectors, areas and workers (such as low-skilled ones) will witness job disruption or loss.
Second, social protection policies can be implemented to compensate households and workers negatively affected by climate policies and to address negative distributional effects. Compensation for higher prices can be achieved through the use of cash transfers to households, which can be funded by revenues from climate policies such as carbon taxes. Full compensation can be achieved by using only a small share (about 30%–50% according to case studies) of the tax revenues generated. The remaining share could be used for other purposes, such as climate-friendly investments. Similarly, when looking at labour market effects, social protection, especially labour market policies such as retraining and unemployment relief, become critical in addressing the needs of negatively affected workers.
Clearly, the achievement of environmental and social goals need not be mutually exclusive. With appropriate policy mixes, both poverty and environmental degradation can be reduced. This policy implication needs to be communicated more widely to increase the acceptance of climate polices. This is partially already achieved by recent plans such as the European Green Deal. From a research and policy perspective, more studies in developing countries are needed, including evidence on non-market climate policies and extending beyond the short-term effect of higher prices on the purchasing power of households. Finally, international cooperation can play an important role in policy coordination, financing and building social protection systems in lower-income countries.