CrisisWatch Newsletter issue 41

Your news on how the economic crisis affects Europe's environment
Issue 41 / March - April 2016
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All eyes are turned on the viability and the future of the European project and EU member states coming even closer together. As Britain, one of the first states to join the European Community back in 1973, is set to decide on the future of its EU membership and the fears of Brexit are now more real than ever, hard evidence on the serious impacts of a possible EU-UK divorce are compelling for both sides. In Britain most of the discussions on the June 26th Referendum have focused on politically burning issues, like immigration, trade and the economy. Yet, the Brexit environmental impact assessment published by The Wildlife Trusts, RSPB and WWF UK reveals that Britain's EU membership has delivered considerable environmental benefits that need to be brought to the political and public debate.

Deeply immersed into an existential quest dominated by the ongoing economic downturn, the fear of Brexit and the refugee crisis, Europe’s leaders downplay the environmental factor and fail to see the
green writing of the wall. Although however the continuing pressures by industry and governments to deregulate crucial green laws and policies in the name of rapid economic growth have pushed the EU to an environmentally lethargic state, evidence that environmental regulations do not harm economies is compelling: a recent report by the OECD concludes that environmental policies and laws do not harm export competitiveness. This conclusion is consistent with the findings of previous OECD studies, which prove that a stringent regulatory framework for the protection of the environment has no negative impact on productivity – instead, they can work together.

As Tony Long, then Director of WWF EU, remarked at an October 2014 conference in Athens, “…politicians are now in the unenviable position of having only a bag of growth indicators to sell to their increasingly skeptical and knowledgeable electorates who want and need to be presented with other indicators of well-being and progress”. It is high time that Europeans stand up and make their voice heard in demand for ecologically and socially sustainable ways out of the crisis.


This newsletter’s news:

  • OECD: Strict green laws do not harm export economies
  • Environmental NGOs on the refugee crisis in Greece
  • UK needs a greener Budget to face high cost of environmental loss
  • Brexit? UK's conservation groups assess environmental impact
  • EU Court of Justice rejects right to free pollution 
  • Policy highlights



OECD: Strict green laws do not harm export economies
Rapid economic growth at all costs being the dominant political mantra since the beginning of the crisis, EU environmental legislation has been the target of unrelenting pressures for easing, on allegations that it prevents businesses from growing and thus hampers economic recovery. A recent study by the OECD however adds evidence to the opposite conclusion: strict environmental regulations and policies do not harm export competitiveness. This conclusion is consistent with the findings of previous OECD studies, which prove that a stringent regulatory framework for the protection of the environment has no negative impact on productivity – instead, they can work together.
According to the working paper, “Environmental policies are not found to be a major driver of international trade patterns, but have some significant effects on specialisation. More stringent domestic policies have no significant effect on overall trade in manufactured goods, but are linked to a comparative disadvantage in "dirty" industries, and a corresponding advantage in "cleaner" industries. The effects are stronger for the domestic component of exports than for gross exports, yet notably smaller than the effects of e.g. trade liberalisation.”
In December 2014, the OECD published another rebuttal to those alleging that green laws undermine competitiveness. According to the 2014 report, “environmental stringency policies do not have to hurt productivity. On the contrary, efforts to improve growth and achieve ambitious environmental goals can go together, and should be stepped up. Environmental policies can and should be shaped to spawn new ideas, mobilise cleaner technologies and encourage new business models that benefit both the economy and the environment”.



Environmental policies are simply not the major driver of international trade patterns,” said OECD Chief Economist Catherine L. Mann, presenting the study at the London School of Economics. “We find no evidence that a large gap between the environmental policies of two given countries significantly affects their overall trade in manufactured goods. Governments should stop working on the assumption that tighter regulations will hurt their export share and focus on the edge they can get from innovation.” 
Since the beginning of the economic crisis, strong pressures for relaxation of environmental laws target the European Commission. Key legislation on environmental impact assessment, industrial emissions, climate change and nature conservation has been attacked by certain business lobbies and governments. 
One notable example of this trend to ease environmental legislation is the Juncker Commission’s initiative to revise the two Natura 2000 directives: Habitats 92/43/EEC and Wild Birds 2009/147/EC. In 2012, the European Commission launched the REFIT (“REgulatory FITness” and Performance) programme. In its Communication, the Commission noted that the economic crisis (aka the “current economic situation”) demands “that EU legislation be even more effective and efficient in achieving its public policy objectives”; it must deliver “full benefits at minimum cost”, aiming at a “simple, clear, stable and predictable regulatory framework for businesses, workers and citizens.” In response to this policy crisis, over 100 environmental groups, including WWF, joined forces and launched the #NatureAlert campaign, with the aim of flooding the European Commission’s public consultation facility with pro-nature individual responses. The massive public response of 520,325 people to the consultation was heard by the European Parliament and governments across Europe.
In a report titled “From crisis to opportunity: five steps to European Sustainable Economies”, WWF has shown why a new economic path towards sustainability is both a necessity and a huge opportunity for Europe, and presents a concrete and ambitious policy roadmap to EU decision-makers. In this sustainability framework, a robust, clear, ambitious and coherent corpus of environmental regulations is absolutely vital.
Read more
OECDOECD InsightsThe EconomistBusiness Green


Environmental NGOs on the refugee crisis in Greece
In the midst of the unprecedented humanitarian crisis facing Greece, with over 50,000 desperate refugees seeking safe passage to central Europe, the country's largest environmental groups, including WWF Greece and Greenpeace, issued the following statement:

"The undersigned environmental organisations care for the commons.
In our work for the protection of the environment, humanity always features at the centre. In the midst of the humanitarian crisis happening now in Greece, we cannot be passive observers of the dramatic situation of tens of thousands of uprooted women, men and children who are stranded and desperate all around our country.

Being a refugee is a condition of human suffering, which can be the result of many factors, including environmental ones. The situation with more than 50 thousand refugees now in Greece has unnecessarily developed into a crisis: while the refugees should be welcome to immediately organized shelters and open reception centers, they are left wandering in a chaotic complex of “formal” and informal camps and shelters, in streets and ports, in parks and fields. The now closed borders of Europe intensify the agony and despair of these uprooted people. With the shining exception of the unfortunately few organized reception centres, thousands of people live in conditions that are unacceptable for any EU member state that respects human rights.

In response to this unprecedented crisis, our environmental organisations have voluntarily contributed to saving people in the Aegean Sea, offering hands-on assistance to the improvement of shelter conditions in different parts of the country, or organising activities for the children. We stand in support and solidarity with the humanitarian non-governmental organisations that uphold the fundamental human rights, save lives and offer hope to thousands of people. The term “non-governmental organisation” or “civil society organisation” constitutes a title of honour for us: the systematic work offered for environmental protection, human life and fundamental rights is of paramount significance to the better world we aim for.

At this point in time, we consider it our duty to position ourselves before the refugee issue, as it is clear that the refugees will stay in Greece for a long time, hence any future planning will need to take this fact into account. 

The humanism and solidarity shown by the Greek society is remarkable and makes our world more beautiful. However, now is the time for the state to proceed with the establishment of organised open shelters, which will offer decent conditions of hospitality, medical care and psychological support, education, and familiarisation with Greek society.

In the midst of this humanitarian crisis, which comes on top of the ongoing severe economic depression in our country, we call on the friends and supporters of our organisations to offer moral or material support to those caring for the refugees. At the same time, our organisations will do their best to support the refugees and the communities that provide hospitality.

We also extend a humanitarian call to the state, in order to urgently care for the setting up and management of proper and adequate structures that will welcome the refugees in our hospitable country.

In every crisis, humanitarianism, love and solidarity are the solution.

ΑΝΙΜΑ, Archelon, Mediterranean SOS Network, Elliniki Etairia – Society for the Environment and Cultural Heritage, Hellenic Ornithological Society (Birdlife), Callisto, MΟm, Ecological Recycling Society, Organisation Earth, Greenpeace, WWF Greece"
WWF Greece


UK needs a greener Budget to face high cost of environmental loss

The Budget must work harder to tackle the growing risks from environmental degradation, natural resource scarcity and climate change if the UK is to enjoy resilient economic growth in the future, states WWF-UK in its recent report. Unless the Government act soon, the consequences for Britain’s prosperity are likely to be costly in the long-term.

In its new 2016 report ‘A Greener Budget: choices for a prosperous future’, WWF-UK sets out a suite of practical policy recommendations that the Treasury could implement through the 2016 Budget to help tackle these risks and put the UK on a more sustainable and resilient economic footing.



WWF-UK is calling on the Chancellor of the Exchequer to put a ‘natural capital stress test’, which highlights the potential risks that the economy faces from environmental damage, at the heart of the Budget. 

The report outlines how the Treasury could use such a stress test to assess, for example, the potential future consequences for business productivity if soil erosion is allowed to continue at current rates or if water stress were to worsen - and to help identify the most appropriate course of action.

Evidence shows that economic costs of neglecting our natural assets can no longer be ignored:

  • Mismanagement of river catchments is a major contributing factor to flooding, which is estimated to have cost the UK at least £5 billion this winter alone
  • The economic value of the eect of small particulate (PM2.5) air pollution on mortality in the UK was around £16 billion in 2008 alone, equivalent to 29,000 premature deaths
  • £1.4 billion in additional annual UK revenues could be expected if UK fish stocks recovered to the average levels seen before the 1970s.

Drawing on the latest evidence, the report shows how tackling these issues through decisive policy action would be a win-win for the environment and the economy - insulating the economy and businesses from growing risks, cutting public sector costs, generating hundreds of thousands of new jobs, creating new market opportunities and improving UK competitiveness.

WWF also proposes that a business-focused Natural Capital Task Force is needed to identify how the private sector can lead better management of natural resources, incentivising innovation and investment in a business-friendly way. It also calls on the Treasury to make disclosure of environmental risks a legal requirement for financial institutions, enabling investors to better understand their risk exposure and to evaluate which investment options deliver the most sustainable returns.

Trevor Hutchings, Director of Advocacy at WWF-UK, said:

George Osborne recently spoke of an economic ‘cocktail of threats’ related to short-term falls in commodity prices and stock markets - and yet he’s said little of the trinity of longer-term risks posed by environmental degradation, resource scarcity and climate change. “

Τhe Chancellor should use the Budget to report on the contribution that the natural environment makes to the UK economy, the risks to businesses and individuals associated with environmental damage, and the measures needed to maintain the healthy natural environment upon which our prosperity depends.

WWF Ambassador Lord Adair Turner (senior fellow at the Institute for New Economic Thinking and former chairman of the UK Financial Services Authority), said:

In the wake of the Paris agreement, and with the impact of climate change on homes and businesses becoming impossible to ignore, creating a green economy through smarter use of taxes and targeted public spending should be a far higher priority for government. Free markets won’t deliver this on their own. The Treasury needs to take a hard look at how we can use all available policy levers to drive this change, starting with this year’s budget.”

Read more: Report by WWF-UK


Brexit? UK's conservation groups assess environmental impact

As the Referendum of 23 June on the future of Britain's EU membership is nearing, Britain's leadeing conservation NGOs informed the political dialogue with a much needed environmental impact assessment of the pros and cons of each vote. On March 8, WWF UK, RSPB and the Wildlife Trusts issued the report "The potential policy and environmental consequences for the UK of a departure from the European Union".

The report has concluded that "on balance, Britain’s membership of the EU has delivered benefits for our environment – such as reduced air and water pollution, reduced carbon emissions, increased recycling, clean beaches and protected areas for rare species and habitats - that would be hard to replicate in the event of the UK leaving. The report also goes on to highlight the risks and uncertainty associated with likely exit scenarios."

According to the report:

  • "Membership of the EU has had, and continues to have, a significant positive impact on environmental outcomes in the UK as well as other parts of Europe, with cleaner air, water and oceans than otherwise could be expected.
  • This is because of a range of legislative, funding and other measures with the potential to work in combination. EU environmental legislation is backed up by a hard legal implementation requirement of a kind that is rarely present in international agreements on the environment; and which is more convincingly long-lasting, and less subject to policy risk, than national legislation.
  • Complete departure from the EU (Brexit Scenario 2) would create identifiable and substantial risks to future UK environmental ambition and outcomes. It would exclude the UK from decision making on EU law and there would be a risk that environmental standards could be lowered to seek competitive advantage outside the EU trading bloc.
  • Departure from the EU whilst retaining membership of the EEA (Brexit Scenario 1) would lessen these risks, as most EU environmental law would continue to apply. However, there would be significant concerns related to nature conservation and bathing water, as well as to agriculture and fisheries policy. In addition, the UK would lose most of its influence on EU environment and climate policies.
  • Under both exit scenarios, significant tensions would be created in relation to areas of policymaking where responsibility is devolved to the governments in Scotland, Wales, and Northern Ireland, but where a broadly similar approach has been required as a result of EU membership, including environmental protection, agriculture, and fisheries.
  • The uncertainty and period of prolonged negotiation on many fronts caused by a UK decision to leave would, itself, create significant risks both for environmental standards and for the green investment needed to improve the UK’s long-term environmental performance."

WWF-UK’s Director of Advocacy Trevor Hutchings said: “As we debate the UK’s future relationship with the EU, it is important that both camps – IN and OUT - consider the impact on the environment. In particular we want to hear how they would set about reversing the decline in species and habitats upon which our economic and social wellbeing depend.  Not everything that comes from Europe has been good for the natural world, but on balance membership of the EU has delivered benefits for our environment that would be hard to replicate in the event of the UK leaving. Whatever the UK’s future relationship with the EU it must not be at the expense of our natural resources, wildlife and wild places.” 

The call comes as a new analysis prepared by the independent Institute for European Environmental Policy, illustrates how EU measures have safeguarded birds such as the bittern, nightjar and Dartford warbler, protected habitats that are essential for butterflies and bees and have delivered cleaner air, rivers and beaches.

The report is also clear that there should be changes and improvements. The Common Agricultural Policy has driven an intensification of agricultural systems across the EU, which has directly driven wildlife declines.  Conservation groups have been campaigning for many years for reforms of the CAP so that it prioritises the protection and enhancement of public goods (such as wildlife), and not just intensification of production. 

Read more: WWF-UK's position on the Referendum, RSBP on the Referendum.



EU Court of Justice rejects right to free pollution 
In a landmark decision, the EU Court of Justice ruled that the free carbon emissions allownaces handed to carbon intensive industries were too much. Jointly judging six cases referred by national courts for preliminary rulings, the CJEU declared invalid the maximum annual amount of free allowances for greenhouse gas emissions determined by the Commission for the period 2013-2020.

According to the Court's 28 April press release': "“In today’s judgment the Court finds, first of all, that the Commission’s 2011 decision, which precludes the taking into account of emissions from electricity generators in the determination of the maximum annual amount of allowances, is valid. It is apparent from the directive that, unlike emissions generated by industrial installations, emissions from electricity generators are never taken into account to determine the maximum annual amount of allowances. The Commission is granted no discretion in that respect. Such asymmetrical treatment of emissions, which limits the number of available allowances, is consistent with the objectives of the directive.

As regards the Commission’s 2013 decision, namely the one determining the correction factor, the Court notes, first, that the scope of the directive has been broadened from 1 January 2013 onwards so as to include, inter alia, emissions from the production of aluminium and from certain sectors of the chemicals industry. Next, the Court points out that, according to the directive and in spite of the various language versions – which have affected the uniformity of its interpretation and its application by the different Member States – the Commission, when calculating the maximum annual amount of allowances, is required to refer only to the emissions of the installations included in the Community system from 2013 onwards, and not to all of the emissions included from then onwards. Thus, the Commission should have ensured that the Member States communicated the relevant data to it. At the very least, in so far as that data did not enable it to determine the maximum annual amount of allowances and, consequently, the correction factor, it should have requested the Member States to make the necessary corrections. However, the Commission took account of data of certain Member States which, unlike others, communicated to it data concerning emissions generated by new activities carried out in installations already subject to the allowance trading scheme before 2013. The Commission’s decision is invalid in that respect.

The EU ETS needs to be reformed in order to make polluters pay, rather than paying polluters, as today’s ruling confirms. Policy makers must ensure that the European carbon market delivers more and faster emission reductions, and commit to phasing out free pollution permits”,  commented Imke Lübbeke, head of climate and energy at WWF European Policy Office.

€24 billion in pollution permits - or ‘emissions allowances’  - were handed out by the European Commission to the most polluting industries, such as chemicals, steel and refineries in 19 European countries from 2008-2014. Yet several companies from those industries went to court to demand even more free pollution permits in order to reduce the perceived risk of job losses to regions with less stringent pollution rules - so-called ‘carbon leakage’ - even though there has never been any evidence of such carbon leakage.

“We must not allow scaremongering by a handful of large polluters to undermine the ETS, and its ability to deliver a high level of environmental protection,“ said Lübbeke.

Read more: WWF EU


Policy highlights

1European Commission (ECFIN), April 2016: Economic sentiment picks up in both the euro and the EU (28 April 2016)“In April, after three consecutive months of decline, the Economic Sentiment Indicator (ESI) picked up in both the euro area (by 0.9 points to 103.9) and the EU (by 0.5 points to 105.1).

2. European Commission (ECFIN), Council conclusions on the fiscal sustainability report (8 March 2016).

"The Council (ECOFIN),

1. WELCOMES the Commission's "Fiscal Sustainability Report 2015", which updates and enhances the multidimensional approach for assessing fiscal sustainability, based on short-, medium- and long-term challenges.

3.  WELCOMES the inclusion of the debt sustainability analysis to enrich conclusions on public debt sustainability in the medium-term. STRESSES that 11 of the 26 EU countries analysed face high medium-term fiscal sustainability risks and 5 countries facing medium risk under the assumption of no policy changes, mainly due to elevated government debt levels, exacerbated in some cases by projected age-related public spending."

3.European Commission, The April infringements package (28 April 2016)“The key decisions taken by the Commission (including, 2 letters of formal notice, 35 reasoned opinions and 6 referrals to the Court of Justice of the European Union) are presented below and grouped by policy area. The Commission is also closing 113 cases where the issues with the Member States concerned have been solved without the Commission needing to pursue the procedure further”.

4.OECD Environment Working Papers. Long-Term Productivity Growth and the Environment. (12 April 2016).
"The natural environment provides crucial inputs and services for economic development, but its role for productivity growth is insufficiently explored. Environmental scarcities can pose a drag on productivity growth and a risk for its sustainability. At the same time productivity growth is often seen as the solution to environmental challenges. Methodological problems abound, overall the literature suggests that environmental issues are a potentially important risk factor. Theoretical models tend to focus the role of resource-augmenting technical progress in the long run, in light of environmental constraints. Macroeconomic studies suggest the contribution of the natural environment to productivity growth has been modest overall. Microeconomic studies focus on partial equilibrium impacts, which in many cases have been found larger than expected. Finally, case-studies of historical civilisation collapses suggest the risks may be significant."


This bi-monthly newsletter is produced by WWF Greece.
For further infοrmation, please contact Τheodota Nantsou, Head of Policy (This email address is being protected from spambots. You need JavaScript enabled to view it.).
Copyright © WWF Greece




Last modified onMonday, 02 May 2016 10:33
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