Euro Split on Carbon Emissions.

The European Union had committed itself to a 20% cut in Carbon Emissions by 2020, and in the face of the deepening financial crisis that decision has been reneged upon. Italy and several east European countries could not accept the proposals and insisted upon their right to veto the proposal.

There is more at stake here than national economies. The European Union had gained some credibility within the international world for its commitment. It now questions how Europe will be able to negotiate with any new regime in America which is committed to cutting emissions.

The French wanted the 27 European Union countries to commit themselves by December, and tried to get agreement on that date. The reduction package also caused some criticism as they consisted of a series of draft laws which dictate how these proposals were to be introduced. To make maters worse the European Parliament loses its mandate in July and an agreement has to be reached by then.

An added problem is that the presidency of the European Union is passes to the Czech Republic in January. The government of the Czech Republic is made up of a coalition, and that coalition is divided by the issue of climate change.

Remarkably, Silvio Berlusconi claimed, that as he was not in office when the agreement was made, therefore, he was not bound by the decision. The European Union has been divided over several issues, but it was always accepted that one government was bound by any previous government’s decisions within the Union. Berlusconi argued that they did not need to go forward by themselves and that they could afford to wait. His gripe was that the reforms would cripple Italian industry. Nor is he a man who likes to be pushed into a corner, and he reacted very strongly against the French for trying to pressurize him into making a decision.

Poland, with support from Bulgaria, Hungary, Latvia, Lithuania, Romania and Slovakia were able to weaken the text of the summit conclusions which had stressed the need for a conclusion by December. They also took the view that they could not support a policy decided upon before they were elected to office.

Part of the problem for Poland is that they still have coal powered power stations, where France have more nuclear power stations. They claim that they are being asked to close down their power stations, but nobody is telling the French to close down their nuclear power stations

The British accused their fellow members of wriggling out of decisions they agreed upon last year. They are expecting an agreement in December and felt that there could be no going back. In Britain the reforms are to be written into the Climate Change Bill. They have taken the position that climate change is too important to be hindered by the financial crisis.

This view has angered the Germans who feel that it would be economically damaging to any country that introduced reforms, while others stayed out of the agreement. The Latvians wanted concessions to the newer countries of the European Union.

The countries that oppose the changes form a big enough block to stop the changes going through. However, if the European Union unanimity rule was invoked, the reforms may get it through. In this case, there just has to be a majority decision rather than all countries supporting it.

As a consequence there are a lot of negotiations to be held. Concessions and opt outs are going to be offered to get everyone on the same side. However, if countries can opt out it will undermine the overall package. We feel that this is a depressing result. If there is to be an economic decline, can’t it be combated by creating jobs in the alternative energy sector? Or is that too simple a solution?