The fact that the climate pact mentions the role fossil fuels play in the climate crisis, is itself unprecedented. There is also the call for the phasing down of unabated coal and inefficient fossil fuel subsidies and these can clearly be considered as progress. It is indeed encouraging that the US and China declared that they want to boost climate cooperation between them. These two countries are the world's two biggest CO2 emitters.
Planet earth is changing and we can limit these drastic changes. However, these are not the only occurring changes. Climate diplomacy is also ushering in changes at the global-political level. We ignore these changes at our own risk.
Prime Ministers and Heads of State have pledged a way or a plan to achieve an overall balance between the amount of carbon the country is emitting and the carbon that it is removing from the atmosphere. This is what is commonly known as net-zero. The EU has set this net-zero target for 2050, other continents have chosen later dates.
So the Climate Summit, broadly speaking, has set the direction of travel for all countries across the globe to move away from carbon as a source of energy until they stop using carbon indefinitely. And this comes at a time when technology is advancing at a rapid pace, possibly heralding a new era fuelled by new sources of energy like hydrogen, not to mention the potential of making renewable sources like solar and wind more affordable.
Innovation, research, digitalisation and decarbonisation hold the promise for our future. Let this be abundantly clear and this is where we, Europeans, have to be very careful.
The challenge before us Europeans is not just to save planet earth, but also to remain competitive on the global stage. Decarbonisation and digitalisation will help the planet but they are also emerging massive markets.
The global race for decarbonisation and digitalisation has started and Europe is losing out already. We need to act now. We owe it to our people.
EU industry employs around 35 million people and accounts for around 16 per cent of EU economies. A competitive industry environment means the creation of high-quality jobs.
China and the US are clearly our main competitors. The Biden Administration is taking the digital and green transitions very seriously and they see these transitions as an opportunity to strengthen US global competitiveness.
While the US is pouring huge sums of money into these transitions, Europe continues to see these transitions as purely regulatory issues. The EU is asking our industry to jump through hoops, whereas the US is directly investing in its industry.
Just this summer, the US Senate proposed to invest $250bn in the next 5 years under the US Innovation and Competition Act. This includes $120bn for the Endless Frontier Act, which invests in science and research. The Build Back Better Act, even if it gets watered down in Congress, will be an unprecedented investment towards developing green and digital solutions.
No matter how good our new EU rules end up being, like the Digital Markets Act, the Digital Services Act and the Fit For 55 Package, our regulation cannot compete with such investments.
If Europe only regulates and does not invest, we are going to lose out in the global race.
Any plan for Europe's green and digital transition will only work if European industry is an integral part of the plan and if EU member states (not only EU Commission) with their public investment money and EU funds, available for them, would heavily invest into digital transition and into the development of new technologies and industries related with this transition. It is very important that we treat green, digital and industrial objectives on an equal footing, as they are all dependent on each other. All these objectives must be brought together in concrete measures for the industrial ecosystem.
We are in favour of very ambitious targets, like cutting emissions to net-zero by 2050. However, it is imperative that we remain realistic and empower our industry to develop world-leading decarbonisation technology in Europe. We must make sure that our climate rules do not push certain industry sectors to other continents.
Public spending and incentives should be aligned to the priorities we set up in our industrial strategy.
Saving the planet is a matter of urgency but we want European industry to stay and thrive in Europe. This is the only known way of securing high-end jobs for our people and our new generations. Let’s not lose this foresight.