There is rare unity across the political camps: Greens, conservatives, even liberals criticize Emmanuel Macron’s statements on the Taiwan issue. But the dispute also has advantages, analyze Amelie Richter and Felix Lee. For in the EU, Macron has thus fueled the urgently needed debate on the future course of China and Taiwan policy.
In recent years, the EU has set standards far beyond its own borders with its rules. This is also known as the “Brussels Effect”. Critical voices have come up with an alternative term: “regulatory imperialism”. And those critical voices are getting louder. That’s why we’re devoting a separate series to the debate starting today. We begin with Caspar Dohmen and Till Hoppe, who analyze the status quo.
The EU also wants to set new standards on the subject of reporting requirements. But the timetable for the CSRD standards could be delayed – because exactly which standards are to be introduced is a question that is to be discussed in detail. In an interview with Claire Stam and Leonie Düngefeld, S&D MEP Pascal Durand explains how it could come to this and why a delay would be fatal.
Much excitement – for nothing? In an interview with the French newspaper Les Echos during his trip to China, French President Emmanuel Macron called for Europe to act more independently in the Taiwan conflict. At the same time, Macron hinted that Europe might not stand by Taiwan in the event of an attack by the People’s Republic. “The worst thing would be to think that we Europeans are fellow travelers and have to adapt to the American rhythm and a Chinese overreaction”, Macron said. Now there is outrage in Berlin and Brussels – partly, at least.
“Macron is isolating himself in Europe, he is weakening the European Union, and he is indeed counteracting what the president of the European Commission said in Beijing“, CDU foreign affairs expert Norbert Röttgen criticized on Deutschlandfunk radio. His party colleague Manfred Weber, chairman of the European People’s Party (EPP) in the EU Parliament, was also appalled. The EU states made themselves untrustworthy “if on the one hand you demand sovereignty for Europe and then conclude every economic deal you can with China“, he tweeted. Longtime EU parliamentarian Reinhard Bütikofer of the Green Party used the hashtag “#braindead” on Twitter.
While Macron, with 50 entrepreneurs in tow, flattered host Xi Jinping during a joint visit with Ursula von der Leyen in Beijing last week, the EU Commission president chose more cautionary words: Should China support Russia “directly or indirectly” with military equipment, this would “severely strain” relations with the EU. She described a possible Chinese attack on Taiwan as an unacceptable course of action.
The government in Paris, however, vehemently rejected the criticism of its president on Tuesday. Macron has repeatedly said that France is not equidistant from the US and China, a spokeswoman for the Élysée Palace said, fending off accusations of equidistance: “The US is our ally, we share common values”. China, on the other hand, is a partner, competitor and systemic rival with whom they want to create a common agenda to reduce tensions and address global issues, she said. On Taiwan, France supports the status quo, she stressed. Macron, she explained, had clearly told China’s leader Xi that the Taiwan issue must be resolved through dialogue.
In Brussels, meanwhile, efforts were made on Tuesday to limit the damage. The joint message of Macron and von der Leyen in the trilateral meeting with Xi was quite “consistent and coherent”, stressed EU Commission spokesman Eric Mamer. As far as the rest of the French leader’s trip or his interview statements on Taiwan are concerned, the EU Commission will not comment – as is generally the case.
Von der Leyen had spoken during her trip in the capacity of EU Commission President and had presented a unified line here compared to the keynote speech a week earlier, Mamer said. There had been coordination with the Élysée before this speech as well as before the joint trip. Since the publication of the Macron interview, however, there has so far been no contact between the offices of the EU Commission President and the French head of state, Mamer explained.
But some in France also view Macron’s interview critically. Von der Leyen and Macron certainly discussed the Taiwan issue during their meeting before their joint trip, said French China watcher Antoine Bondaz. The problem, he said, is that Macron has failed to present an agenda that defines the EU’s interests and strategy. “Saying we don’t have the same interests as the US is obvious”, Bondaz criticized. “And distancing ourselves from the US is not a strategy in itself”. The timing of Macron’s pronouncements was disastrous, he said.
“It is a statement that has not benefited French policy”, Stéphane Corcuff, a sinologist at Sciences Po Lyon University, told the France24news platform. “The only thing that can stop China from attacking Taiwan is the knowledge that we will be there to respond”, Corcuff said.
Nevertheless, Washington reacted calmly. There is an “excellent” bilateral relationship with France, said John Kirby, spokesman for the US Security Council. President Joe Biden has a good personal relationship with Macron, he said, and the two work closely together on various issues – including Asia.
EU Green politician Bütikofer has his own reading: Macron had actually not intended to talk about the subject of Taiwan on his Beijing trip, on the grounds that he was a stoic and would only talk about the things he could talk about. Élysée circles also said before the trip that the topic of Taiwan would not be actively addressed.
The fact that he then did get carried away was a success for the Chinese side, who showered him with attention, which he then self-indulgently fell victim to, Bütikofer says. “Macron’s unspeakable remarks were a mixture of one-third tending toward anti-American French tradition, 15 percent fatigue and, above all, a lot of arrogance“.
To what extent has Macron harmed Taiwan with this? “Not so much, effectively”, Bütikofer answers. Macron had given the debate on Taiwan a boost and at the same time marked a position that not many in Europe would find easy to follow. “Macron’s remarks have once again highlighted the need to come to a common European position in support of Taiwan”.
So now Europe is faced with the need to conduct the debate that should ultimately result in a common position. Poland’s Prime Minister Mateusz Morawiecki stressed Tuesday before leaving for the United States that the alliance with the United States would become “the top priority of the upcoming Polish presidency of the EU Council”, as “this is the foundation of our security”. Poland takes over the presidency of the EU Council in early 2025. Other opinions came – unsurprisingly – from Hungary. The EU must “finally wake up” to its own interests and not simply follow the US, Balázs Orbán, close political adviser to Hungarian Prime Minister Viktor Orbán, wrote on Twitter. He quoted his boss with statements seemingly similar to those of Macron.
Macron, von der Leyen and German Minister for Foreign Affairs Annalena Baerbock are not the only visitors from Europe this week: EU High Representative for Foreign Affairs Josep Borrell is also traveling to Beijing. Borrell is expected there from Thursday to Saturday. Borrell’s visit had been planned for quite some time, a spokeswoman of the European External Action Service (EEAS) assured. After last week, however, his trip is likely to receive special attention. The EU foreign affairs envoy has not necessarily been known for critical language toward China. Observers in Brussels and Beijing will therefore listen closely to whether he follows his boss von der Leyen. By Amelie Richter and Felix Lee
The European Union has few instruments of hard power, such as the military. This does not mean that it is powerless: No one else is able to set international rules and standards like the EU, not even the two great powers, the United States and China. What the European Parliament and member states decide for the European Single Market often shapes business practices and laws in other parts of the world. This “Brussels Effect”, says US researcher Anu Bradford, works from data protection rules to chemical regulations for toys.
There has always been criticism of this in other parts of the world. But it is now gaining in volume. In particular, Europe’s sustainability agenda is being “increasingly loudly and clearly criticized by others as green protectionism and extraterritorial regulation”, warned the EU Commission’s trade Director General, Sabine Weyand, recently. She frequently hears accusations of “regulatory imperialism” from interlocutors in Asia, Africa or Latin America.
The cornerstones are as follows:
Whereas the EU had previously left the “Brussels Effect” primarily to market forces, its sustainability agenda is now encroaching more deeply on the regulatory sovereignty of other countries. The loud criticism of this that is echoing back to the Europeans from Brazil, Indonesia and South Africa is also rooted in the growing self-confidence of the countries in the Global South: They are no longer dependent on Europe. In South America, for example, China has recently replaced the EU as the most important trading partner. Beijing is notoriously uninterested in local production conditions. In this respect, the growing criticism is an expression of an increasingly multipolar world.
The Table.Media editorial team will be addressing this complex of issues in a series of articles in the coming weeks. In Africa.Table, we report on the criticism of the new standards that are being imposed on local actors without being asked. Our colleagues at Climate.Table analyze why China and India, for example, see the CO2 Border Adjustment Mechanism as green protectionism. China.Table, in turn, traces how Beijing is trying to enforce its own norms and standards via its new Silk Road. We are bundling these published articles here for you in one place.
The new balance of power allows countries in the Global South to assert their interests more strongly in order to advance their economic development. Indonesia, for example, has banned the export of nickel and thus succeeded in establishing a number of nickel processing factories, thus keeping more value added in the country. Chile enforced price differentiation in its free trade agreement with the EU: If mines there extract lithium from the ground, it may be sold for domestic production at lower prices than if the raw material is exported.
Those responsible in Berlin and Brussels are therefore striking a new tone: He wants to “make it clear that we are a fair partner”, says Chancellor Olaf Scholz. He thinks that the agreement with Chile is “very exemplary, because it also includes independent development opportunities for Chile”.
The question of social standards in world trade is as old as modern globalization. The International Labor Organization (ILO) was founded more than a hundred years ago because the industrialized countries wanted to prevent some of them from gaining unfair competitive advantages through social dumping.
When the WTO was founded in 1995, the US government failed in its attempt to establish minimum social standards in world trade. The developing countries did not want to give up their competitive advantage of low wages and accused the industrialized countries of protectionism through the back door. But there were also pushes from the Global South to regulate international business: Since 2014, a working group of the UN Human Rights Committee has been negotiating new rules for transnationally active companies. The impetus came from Ecuador and South Africa.
The discussion is being reopened today under new auspices. French President Emmanuel Macron, for example, is calling for farmers in South America to be subject to comparable requirements, for example in terms of pesticide use, as domestic farmers – otherwise Paris will not be able to approve the Mercosur trade agreement. The Greens in Berlin’s traffic light coalition are linking their approval of the agreement to the fact that it must be possible to enforce the climate protection commitments enshrined in the agreement by means of sanctions such as new tariffs, if necessary. But the governments of Brazil and Co. would not agree to this, according to warnings in EU Commission circles.
Proponents such as Maik Außendorf, a member of the Green Party in the German Bundestag, argue that the elites in the countries of the Global South often represent their own interests, while those affected on the ground, such as indigenous peoples in the Amazon region, welcome the standards demanded by Europe.
But there is growing concern among local companies: “We have to be careful not to overburden Small and Medium-sized Enterprises (SMEs) with requirements – otherwise they will be excluded from trade”, says María Fernanda Garza, president of the International Chamber of Commerce (ICC) and head of an 80-employee business from Mexico. These companies would need financial and organizational help to be able to implement the requirements at all.
Mr. Durand, it was only last summer that you reached agreement with the Commission and the Council on the new sustainability reporting requirements. The Commission has now instructed that the development of the standards be partially postponed. Was the timetable too ambitious?
We are in a moment of truth. The European Union is always pretty strong in defining principles, values, and defending the goals it sets for itself, whether it’s climate, environment, or social. After that comes implementation – and that’s where it gets complicated.
The Commission has mandated the European Financial Reporting Advisory Group (EFRAG) to develop and implement reporting standards. The group has already presented some of the drafts. It seemed to work after all, didn’t it?
There is a battle for influence going on within the European Commission. Some people are asking the Commission to slow down on standards, arguing that you shouldn’t make too many standards. Others, however, are asking the Commission to stick to the mandate it has been given. The European Parliament’s position is that the four pillars of climate, environment, social and governance must be advanced simultaneously.
How sould one imagine these struggles for influence?
A French Member of Parliament, who is very concerned about the climate issue, wrote a letter to the Commission and said, “Ah, but wait a minute, maybe it would be good to look only at the climate pillar first and delay the other areas”. I don’t know what prompted him to do that, but I regret it. We parliamentarians have given a mandate to the Commission to come forward with a delegated act that addresses all four pillars. If I now, as a parliamentarian, give the Commission the possibility to adopt several delegated acts, I am giving the executive priority over the legislative.
What’s at stake?
This delegated act is the first important point: we as Parliament will have to approve it or object to it. And that’s what some opponents and conservatives are alluding to. Imagine if the delegated act only contained climate. We would be faced with a terrible dilemma: Do I reject the delegated act because the social, environmental and governance standards are not there – even though I know that the US and China are working on their own climate standards and therefore we must have our own quickly? Or do I say, on the contrary: too bad, but climate is important, so I’ll have to vote for it willy-nilly.
In March, Commission President Ursula von der Leyen announced plans to reduce reporting requirements for companies by 25 percent. The Directorates-General will be working on proposals for this by fall. Will the CSRD plans suffer as a result?
If Ms. von der Leyen believes she has to reduce bureaucracy with the “one in, one out” principle – which would, of course, be understandable – then she has to cut in all four pillars at the same time. One cannot apply this principle for the sake of climate at the expense of environmental, social and governance issues. I do not yet know how and in what form Ms. von der Leyen will take up this principle. There are several ways to deduct 25 percent: Either I assume that, for example, the environmental part, biodiversity, governance and human rights make up 25 percent of the whole – and then I subtract that block. Or I take away a quarter of the whole.
Wouldn’t you agree, then, to keep the reporting as simple as possible?
I am not a bureaucrat in spirit. So if I’m told that the standards need to be simplified, then let’s simplify the standards. But again, only as long as the principles of the standard and the entire text are not touched. NGOs and trade unions have written to Ms. von der Leyen to tell her how concerned they are that European ambitions not be diminished. I am on that line. And we will see what Ms. von der Leyen’s response will be.
How do you see EFRAG’s role?
EFRAG is a specialist in financial standards and the Commission is asking it to do work in the non-financial area – without providing it with additional financial resources. Once again, the EU is relying on volunteer labor here. On the other hand, Germany has allocated £4 million in 2022 to fund the International Sustainability Standards Board (ISSB), an organization that competes with the Europeans. That’s like Germany funding General Motors with millions and giving Volkswagen nothing. Of course, the comparison is exaggerated, but there would never be such a case in the industrial sector, never.
Do you have an explanation for this?
Why start with the standards to fund a foundation under foreign law, which is outside the European Union? I do not know, which is why I ask this question.
The ISSB is developing international standards for sustainability reporting on behalf of the US IFRS Foundation. How do the European standards differ from other standards?
The EU wants to set standards based on European values that balance social, environmental and economic issues. In particular, the principle of double materiality is brought to the fore. For example, if I am founding a lemonade factory in a region where there is a water risk due to climate change, in addition to the risk to my own business (that would be single materiality), I must also consider the risks I am taking as a business to the region. For example, the consequences for the water supply for a particular city or for agriculture. This also relates to human and social rights: If I import products from Bangladesh, am I putting children to work?
This aspect does not interest the Anglo-Saxon, at least the American normativity at all. There, they advocate simple climate standards, while Europe wants general standards on all ESG pillars and double materiality.
Where do the European standards go from here?
The delegated act is scheduled to come in June. We are on an extremely clear line: We want all four pillars at the same time, as we have demanded as a parliament. We would accept that certain standards be delayed in their application. I can completely understand that, for example, with human rights standards, you first have to get the value chain right and look at exactly how it’s done in Brazil or Bangladesh, that you have to have the means to control it and so on. If this can’t be done until 2026 or 2027, I have no problem with that. But I would like the rules and standards to be set now and not wait until 2026 or 2027 to do that. And then we pragmatically take the time to implement them, depending on what the companies tell us.
Why do you think the timing is so important?
Because our term ends in March 2024, after which elections will be held. The term of the Commission and the Council will also end at that time. I don’t know what will happen after that. We have a tight schedule. That’s why there is no time for postponements now.
Spanish Socialist Nicolás González Casares will be the EU Parliament’s rapporteur for electricity market reform. This was announced by the S&D group on Tuesday. Casares will thus be responsible for amending the Directive and Regulation on the internal electricity market, as well as the ACER Regulation and the Renewable Energy Directive (RED). A draft report from Parliament is expected before the end of April or May. The Commission submitted its proposal in mid-March in response to the drastic rise in electricity prices last year.
The Portuguese Maria da Graça Carvalho (EPP) had already been appointed as rapporteur for the REMIT Regulation. Yesterday, the Finnish MEP Miapetra Kumpula-Natri was appointed as shadow rapporteur for S&D.
Casares was already shadow rapporteur for the RED amendment from the Green Deal, he is considered a rather green-oriented socialist. The social democrat belongs to the governing PSOE party of Prime Minister Pedro Sanchéz and Energy Minister Teresa Ribera, under whose chairmanship in the Council the electricity market reform will probably be concluded in the second half of the year.
The Spanish government was still the driving force in the electricity market debate at EU level last year to “decouple” the price of electricity from the price of gas. In the Brussels S&D, however, Casares is seen as a team player who takes on board comments from within the group. However, even within the Socialists, MEPs from the more interventionist member states Spain, Italy and Portugal have a majority.
The German energy industry yesterday again warned against transferring too many elements from the Spanish electricity market to the entire EU. The German Renewable Energy Federation (BEE) advocated strengthening “regional flexibility options” – which means additional market remuneration for flexible generation, storage and demand. “We therefore reject a transfer of the Spanish model with mandatory introduction of rigid Contracts for Difference (CfD) to the entire EU and are counting on Casares to make concessions in the sense of finding a compromise”, BEE President Simone Peter told Table.Media.
S&D also named yesterday the shadow rapporteurs for two other important pieces of legislation. Mohammed Chahim of the Netherlands is negotiating the Critical Raw Materials Act (CRMA) on behalf of his group, while Tsvetelina Penkova of Bulgaria is negotiating the Net Zero Industry Act (NZIA). ber
Negotiations on the AI Act in the EU Parliament are entering the decisive phase. This week, two technical meetings and a meeting of the shadow rapporteurs are scheduled for the AI Act. Next week, another technical meeting and two shadow meetings are scheduled to take place. If negotiators reach an agreement, IMCO and LIBE committee votes are scheduled for April 26. Then the full committee could vote on May 31. Given the rapid developments in generative language models such as ChatGPT, time is of the essence.
Among the negotiators at the technical level is Kai Zenner from the office of EPP MEP Axel Voss. To achieve a breakthrough, all sides would have to show a willingness to compromise, Zenner tweeted on Tuesday. He also posted an overview on Twitter of which articles the negotiators have already agreed on. These were bundled into batches by the reporters.
There is apparently widespread agreement at the technical level on the controversial definition of AI. This will probably be adapted to the definitions of the OECD and the American standardization authority NIST. However, the negotiators have not yet been able to agree, among other things, on whether free and open source software (FOSS) falls within the scope of the AI Act or not. There is agreement on the establishment of a European AI Office, but not yet on the details. In general, the negotiators at the political level have thus far only ticked a few batches.
In the USA, the government is also preparing for possible regulatory measures for artificial intelligence systems; such as the large-scale voice model ChatGPT. The US IT authority NTIA is launching a public consultation on this. Responsible AI systems could bring enormous benefits, but only “if we address their potential consequences and harms”, according to an NTIA press release.
The goal of the consultation, the statement said, is to find out what measures can support the development of AI audits, assessments, certifications, and other mechanisms to build trust in AI systems. Just as food and cars only enter the market when their safety is assured, the same should be true for AI systems. vis
Lawmakers in the EU and the US have no time to lose when it comes to regulating artificial intelligence, according to a survey by digital association Bitkom. According to the survey, one in six companies in Germany (17 percent) is planning to use language models such as ChatGPT to generate text. Another 23 percent can imagine using them.
AI has the potential to “cushion the massive impact of demographic developments and the worsening shortage of skilled workers”, said Bitkom President Achim Berg. He called for technological development in AI to be driven forward in Germany and for a practical set of rules to be developed for its application in Europe and worldwide. “The current ban discussion, as initiated by the Federal Data Protection Commissioner, is completely going in the wrong direction”, Berg said.
In the survey, the majority (56 percent) of companies see AI for text generation as the “biggest digital revolution since the smartphone“, but 40 percent also see it as hype that will soon pass. Nevertheless, 70 percent expect AI for text generation to be part of everyday work in the future. vis
The Association of European Transmission System Operators (ENTSOG) published the draft of the ten-year network development plan (TYNDP) 2022 on Tuesday. Included in the new version are plans for a European hydrogen network. “The Hydrogen and Natural Gas TYNDP 2022 is the first of its kind to assess the benefits of relevant projects for decarbonized gases and demonstrates that the gas system is a resilient, efficient and cost-effective infrastructure“, ENTSOG President Piotr Kuś said.
According to ENTSOG, the current network development plan also takes into account the goals of REPowerEU from last spring. With the plan, the EU wants to diversify its import sources for natural gas and switch its supply more quickly to low-carbon gases. A consultation on the TYNDP 2022 is open until May 19.
A table on capacities of the future hydrogen infrastructure contains partly surprising data on the supply of the Federal Republic. According to the data set for Germany, Finland would become the most important import source for hydrogen as early as 2030. According to the data, future pipeline capacities from Finland would be 504 gigawatt hours per day (GWh/d), from Norway 414 GWh/d, and from the Netherlands 375 GWh/d. In contrast, the landfall capacities for ship transports of liquefied hydrogen would be significantly lower. For the German coasts, ENTSOG calculates only 228 GWh/d. ber
The deputy prime minister of the Netherlands, Sigrid Kaag, warns of dwindling public support for climate and environmental policies. This is evident, among other things, in the ongoing farmers’ protests in the country, the finance minister told the Financial Times. In times of great uncertainty, it is becoming increasingly difficult to win over the population for intergenerational measures, said Kaag, who chairs the liberal D66 party. This also applies to other EU countries, she said.
After Malta, the Netherlands is the most densely populated country in the EU with the highest livestock density. For every 17 million inhabitants, there are around eleven million pigs alone. The country has to contend with correspondingly high nitrogen emissions, which the government plans to halve by 2030. To achieve this, livestock numbers are to be drastically reduced, which is causing outrage.
“We have to deal with our decades-long inability to address the issue because it was either too sensitive or underestimated”, Kaag said. This is not a matter of partisan politics, she said, but a scientific necessity. “This is a crisis, and pretending it doesn’t exist doesn’t bring the solution any closer”. til
When classical music can be heard in the corridors of the European Parliament late at night, MEP Dennis Radtke is still in his office. There, the CDU politician has installed speakers that play Wagner, among other things, while he goes through files. Reconciling different things is part of everyday life for Radtke, who belongs to the CDU’s workers’ wing and the Christian-conservative EPP Group.
The 43-year-old sees himself in the tradition of politicians like Karl-Josef Laumann and Norbert Blüm, who made their careers in the party via the CDU social committees. Radtke, a father of two, is the contact person for the Union’s social policy in Brussels: he was co-rapporteur on the European Minimum Wage Directive, and he is the Group’s coordinator on the Committee on Employment and Social Affairs (EMPL). He is also head of the CDA in NRW and head of the CDA at EU level.
Born in Bochum, he comes from an SPD family. Both of his grandfathers were comrades for over 50 years and were active in IG Metall. Until 2002, Radtke himself held the red party member card. He later joined the CDU and the Christian Democratic Employees’ Association (CDA). After training as an industrial clerk, he became trade union secretary at the Mining, Chemical and Electronics Industrial Union (IGBCE) in Moers.
The balancing act between the Union and the CDU is not always easy for Radtke: “In the Union you’re always the black guy, and in the party you’re always the red guy”. To this day, school classes regularly ask him why he switched to the CDU. His answer: “Some of them broke windows in their youth, and my mistake was that I used to be in the SPD”.
What drives Radtke to this day are the issues of his grandfathers’ SPD, which pragmatically stood up for people with low to medium incomes. Unfortunately, that era is over. Today, he says, the SPD is too much about marginalized groups like transgender people and gender-sensitive language. “There’s nothing there for industrial jobs anymore”, Radtke says. He moved up to the EU Parliament in 2017, when Herbert Reul became interior minister of North Rhine-Westphalia. In 2019, he made it back via the state list.
On the EMPL committee, Radtke advocates for contemporary labor law issues. One major issue for him is the regulation of platform work: More than five million people are misclassified and currently registered as pseudo self-employed, he says. They would be denied access to minimum wage and social security. In addition, he says, big players like Uber have a competitive advantage over local cab companies. “It’s quite adventurous that we are only now starting to regulate these things“, says Radtke.
In the discussion on the Green New Deal, Radtke took on the Dutch Social Democrat and EU Climate Commissioner Frans Timmermanns in February. Radtke has nothing against setting ambitious climate protection targets, but worries about industrial jobs and the affordability of mobility: “The Green Deal has to happen with industry as a partner, as a driver, not as an opponent”. Leonard Schulz
There is rare unity across the political camps: Greens, conservatives, even liberals criticize Emmanuel Macron’s statements on the Taiwan issue. But the dispute also has advantages, analyze Amelie Richter and Felix Lee. For in the EU, Macron has thus fueled the urgently needed debate on the future course of China and Taiwan policy.
In recent years, the EU has set standards far beyond its own borders with its rules. This is also known as the “Brussels Effect”. Critical voices have come up with an alternative term: “regulatory imperialism”. And those critical voices are getting louder. That’s why we’re devoting a separate series to the debate starting today. We begin with Caspar Dohmen and Till Hoppe, who analyze the status quo.
The EU also wants to set new standards on the subject of reporting requirements. But the timetable for the CSRD standards could be delayed – because exactly which standards are to be introduced is a question that is to be discussed in detail. In an interview with Claire Stam and Leonie Düngefeld, S&D MEP Pascal Durand explains how it could come to this and why a delay would be fatal.
Much excitement – for nothing? In an interview with the French newspaper Les Echos during his trip to China, French President Emmanuel Macron called for Europe to act more independently in the Taiwan conflict. At the same time, Macron hinted that Europe might not stand by Taiwan in the event of an attack by the People’s Republic. “The worst thing would be to think that we Europeans are fellow travelers and have to adapt to the American rhythm and a Chinese overreaction”, Macron said. Now there is outrage in Berlin and Brussels – partly, at least.
“Macron is isolating himself in Europe, he is weakening the European Union, and he is indeed counteracting what the president of the European Commission said in Beijing“, CDU foreign affairs expert Norbert Röttgen criticized on Deutschlandfunk radio. His party colleague Manfred Weber, chairman of the European People’s Party (EPP) in the EU Parliament, was also appalled. The EU states made themselves untrustworthy “if on the one hand you demand sovereignty for Europe and then conclude every economic deal you can with China“, he tweeted. Longtime EU parliamentarian Reinhard Bütikofer of the Green Party used the hashtag “#braindead” on Twitter.
While Macron, with 50 entrepreneurs in tow, flattered host Xi Jinping during a joint visit with Ursula von der Leyen in Beijing last week, the EU Commission president chose more cautionary words: Should China support Russia “directly or indirectly” with military equipment, this would “severely strain” relations with the EU. She described a possible Chinese attack on Taiwan as an unacceptable course of action.
The government in Paris, however, vehemently rejected the criticism of its president on Tuesday. Macron has repeatedly said that France is not equidistant from the US and China, a spokeswoman for the Élysée Palace said, fending off accusations of equidistance: “The US is our ally, we share common values”. China, on the other hand, is a partner, competitor and systemic rival with whom they want to create a common agenda to reduce tensions and address global issues, she said. On Taiwan, France supports the status quo, she stressed. Macron, she explained, had clearly told China’s leader Xi that the Taiwan issue must be resolved through dialogue.
In Brussels, meanwhile, efforts were made on Tuesday to limit the damage. The joint message of Macron and von der Leyen in the trilateral meeting with Xi was quite “consistent and coherent”, stressed EU Commission spokesman Eric Mamer. As far as the rest of the French leader’s trip or his interview statements on Taiwan are concerned, the EU Commission will not comment – as is generally the case.
Von der Leyen had spoken during her trip in the capacity of EU Commission President and had presented a unified line here compared to the keynote speech a week earlier, Mamer said. There had been coordination with the Élysée before this speech as well as before the joint trip. Since the publication of the Macron interview, however, there has so far been no contact between the offices of the EU Commission President and the French head of state, Mamer explained.
But some in France also view Macron’s interview critically. Von der Leyen and Macron certainly discussed the Taiwan issue during their meeting before their joint trip, said French China watcher Antoine Bondaz. The problem, he said, is that Macron has failed to present an agenda that defines the EU’s interests and strategy. “Saying we don’t have the same interests as the US is obvious”, Bondaz criticized. “And distancing ourselves from the US is not a strategy in itself”. The timing of Macron’s pronouncements was disastrous, he said.
“It is a statement that has not benefited French policy”, Stéphane Corcuff, a sinologist at Sciences Po Lyon University, told the France24news platform. “The only thing that can stop China from attacking Taiwan is the knowledge that we will be there to respond”, Corcuff said.
Nevertheless, Washington reacted calmly. There is an “excellent” bilateral relationship with France, said John Kirby, spokesman for the US Security Council. President Joe Biden has a good personal relationship with Macron, he said, and the two work closely together on various issues – including Asia.
EU Green politician Bütikofer has his own reading: Macron had actually not intended to talk about the subject of Taiwan on his Beijing trip, on the grounds that he was a stoic and would only talk about the things he could talk about. Élysée circles also said before the trip that the topic of Taiwan would not be actively addressed.
The fact that he then did get carried away was a success for the Chinese side, who showered him with attention, which he then self-indulgently fell victim to, Bütikofer says. “Macron’s unspeakable remarks were a mixture of one-third tending toward anti-American French tradition, 15 percent fatigue and, above all, a lot of arrogance“.
To what extent has Macron harmed Taiwan with this? “Not so much, effectively”, Bütikofer answers. Macron had given the debate on Taiwan a boost and at the same time marked a position that not many in Europe would find easy to follow. “Macron’s remarks have once again highlighted the need to come to a common European position in support of Taiwan”.
So now Europe is faced with the need to conduct the debate that should ultimately result in a common position. Poland’s Prime Minister Mateusz Morawiecki stressed Tuesday before leaving for the United States that the alliance with the United States would become “the top priority of the upcoming Polish presidency of the EU Council”, as “this is the foundation of our security”. Poland takes over the presidency of the EU Council in early 2025. Other opinions came – unsurprisingly – from Hungary. The EU must “finally wake up” to its own interests and not simply follow the US, Balázs Orbán, close political adviser to Hungarian Prime Minister Viktor Orbán, wrote on Twitter. He quoted his boss with statements seemingly similar to those of Macron.
Macron, von der Leyen and German Minister for Foreign Affairs Annalena Baerbock are not the only visitors from Europe this week: EU High Representative for Foreign Affairs Josep Borrell is also traveling to Beijing. Borrell is expected there from Thursday to Saturday. Borrell’s visit had been planned for quite some time, a spokeswoman of the European External Action Service (EEAS) assured. After last week, however, his trip is likely to receive special attention. The EU foreign affairs envoy has not necessarily been known for critical language toward China. Observers in Brussels and Beijing will therefore listen closely to whether he follows his boss von der Leyen. By Amelie Richter and Felix Lee
The European Union has few instruments of hard power, such as the military. This does not mean that it is powerless: No one else is able to set international rules and standards like the EU, not even the two great powers, the United States and China. What the European Parliament and member states decide for the European Single Market often shapes business practices and laws in other parts of the world. This “Brussels Effect”, says US researcher Anu Bradford, works from data protection rules to chemical regulations for toys.
There has always been criticism of this in other parts of the world. But it is now gaining in volume. In particular, Europe’s sustainability agenda is being “increasingly loudly and clearly criticized by others as green protectionism and extraterritorial regulation”, warned the EU Commission’s trade Director General, Sabine Weyand, recently. She frequently hears accusations of “regulatory imperialism” from interlocutors in Asia, Africa or Latin America.
The cornerstones are as follows:
Whereas the EU had previously left the “Brussels Effect” primarily to market forces, its sustainability agenda is now encroaching more deeply on the regulatory sovereignty of other countries. The loud criticism of this that is echoing back to the Europeans from Brazil, Indonesia and South Africa is also rooted in the growing self-confidence of the countries in the Global South: They are no longer dependent on Europe. In South America, for example, China has recently replaced the EU as the most important trading partner. Beijing is notoriously uninterested in local production conditions. In this respect, the growing criticism is an expression of an increasingly multipolar world.
The Table.Media editorial team will be addressing this complex of issues in a series of articles in the coming weeks. In Africa.Table, we report on the criticism of the new standards that are being imposed on local actors without being asked. Our colleagues at Climate.Table analyze why China and India, for example, see the CO2 Border Adjustment Mechanism as green protectionism. China.Table, in turn, traces how Beijing is trying to enforce its own norms and standards via its new Silk Road. We are bundling these published articles here for you in one place.
The new balance of power allows countries in the Global South to assert their interests more strongly in order to advance their economic development. Indonesia, for example, has banned the export of nickel and thus succeeded in establishing a number of nickel processing factories, thus keeping more value added in the country. Chile enforced price differentiation in its free trade agreement with the EU: If mines there extract lithium from the ground, it may be sold for domestic production at lower prices than if the raw material is exported.
Those responsible in Berlin and Brussels are therefore striking a new tone: He wants to “make it clear that we are a fair partner”, says Chancellor Olaf Scholz. He thinks that the agreement with Chile is “very exemplary, because it also includes independent development opportunities for Chile”.
The question of social standards in world trade is as old as modern globalization. The International Labor Organization (ILO) was founded more than a hundred years ago because the industrialized countries wanted to prevent some of them from gaining unfair competitive advantages through social dumping.
When the WTO was founded in 1995, the US government failed in its attempt to establish minimum social standards in world trade. The developing countries did not want to give up their competitive advantage of low wages and accused the industrialized countries of protectionism through the back door. But there were also pushes from the Global South to regulate international business: Since 2014, a working group of the UN Human Rights Committee has been negotiating new rules for transnationally active companies. The impetus came from Ecuador and South Africa.
The discussion is being reopened today under new auspices. French President Emmanuel Macron, for example, is calling for farmers in South America to be subject to comparable requirements, for example in terms of pesticide use, as domestic farmers – otherwise Paris will not be able to approve the Mercosur trade agreement. The Greens in Berlin’s traffic light coalition are linking their approval of the agreement to the fact that it must be possible to enforce the climate protection commitments enshrined in the agreement by means of sanctions such as new tariffs, if necessary. But the governments of Brazil and Co. would not agree to this, according to warnings in EU Commission circles.
Proponents such as Maik Außendorf, a member of the Green Party in the German Bundestag, argue that the elites in the countries of the Global South often represent their own interests, while those affected on the ground, such as indigenous peoples in the Amazon region, welcome the standards demanded by Europe.
But there is growing concern among local companies: “We have to be careful not to overburden Small and Medium-sized Enterprises (SMEs) with requirements – otherwise they will be excluded from trade”, says María Fernanda Garza, president of the International Chamber of Commerce (ICC) and head of an 80-employee business from Mexico. These companies would need financial and organizational help to be able to implement the requirements at all.
Mr. Durand, it was only last summer that you reached agreement with the Commission and the Council on the new sustainability reporting requirements. The Commission has now instructed that the development of the standards be partially postponed. Was the timetable too ambitious?
We are in a moment of truth. The European Union is always pretty strong in defining principles, values, and defending the goals it sets for itself, whether it’s climate, environment, or social. After that comes implementation – and that’s where it gets complicated.
The Commission has mandated the European Financial Reporting Advisory Group (EFRAG) to develop and implement reporting standards. The group has already presented some of the drafts. It seemed to work after all, didn’t it?
There is a battle for influence going on within the European Commission. Some people are asking the Commission to slow down on standards, arguing that you shouldn’t make too many standards. Others, however, are asking the Commission to stick to the mandate it has been given. The European Parliament’s position is that the four pillars of climate, environment, social and governance must be advanced simultaneously.
How sould one imagine these struggles for influence?
A French Member of Parliament, who is very concerned about the climate issue, wrote a letter to the Commission and said, “Ah, but wait a minute, maybe it would be good to look only at the climate pillar first and delay the other areas”. I don’t know what prompted him to do that, but I regret it. We parliamentarians have given a mandate to the Commission to come forward with a delegated act that addresses all four pillars. If I now, as a parliamentarian, give the Commission the possibility to adopt several delegated acts, I am giving the executive priority over the legislative.
What’s at stake?
This delegated act is the first important point: we as Parliament will have to approve it or object to it. And that’s what some opponents and conservatives are alluding to. Imagine if the delegated act only contained climate. We would be faced with a terrible dilemma: Do I reject the delegated act because the social, environmental and governance standards are not there – even though I know that the US and China are working on their own climate standards and therefore we must have our own quickly? Or do I say, on the contrary: too bad, but climate is important, so I’ll have to vote for it willy-nilly.
In March, Commission President Ursula von der Leyen announced plans to reduce reporting requirements for companies by 25 percent. The Directorates-General will be working on proposals for this by fall. Will the CSRD plans suffer as a result?
If Ms. von der Leyen believes she has to reduce bureaucracy with the “one in, one out” principle – which would, of course, be understandable – then she has to cut in all four pillars at the same time. One cannot apply this principle for the sake of climate at the expense of environmental, social and governance issues. I do not yet know how and in what form Ms. von der Leyen will take up this principle. There are several ways to deduct 25 percent: Either I assume that, for example, the environmental part, biodiversity, governance and human rights make up 25 percent of the whole – and then I subtract that block. Or I take away a quarter of the whole.
Wouldn’t you agree, then, to keep the reporting as simple as possible?
I am not a bureaucrat in spirit. So if I’m told that the standards need to be simplified, then let’s simplify the standards. But again, only as long as the principles of the standard and the entire text are not touched. NGOs and trade unions have written to Ms. von der Leyen to tell her how concerned they are that European ambitions not be diminished. I am on that line. And we will see what Ms. von der Leyen’s response will be.
How do you see EFRAG’s role?
EFRAG is a specialist in financial standards and the Commission is asking it to do work in the non-financial area – without providing it with additional financial resources. Once again, the EU is relying on volunteer labor here. On the other hand, Germany has allocated £4 million in 2022 to fund the International Sustainability Standards Board (ISSB), an organization that competes with the Europeans. That’s like Germany funding General Motors with millions and giving Volkswagen nothing. Of course, the comparison is exaggerated, but there would never be such a case in the industrial sector, never.
Do you have an explanation for this?
Why start with the standards to fund a foundation under foreign law, which is outside the European Union? I do not know, which is why I ask this question.
The ISSB is developing international standards for sustainability reporting on behalf of the US IFRS Foundation. How do the European standards differ from other standards?
The EU wants to set standards based on European values that balance social, environmental and economic issues. In particular, the principle of double materiality is brought to the fore. For example, if I am founding a lemonade factory in a region where there is a water risk due to climate change, in addition to the risk to my own business (that would be single materiality), I must also consider the risks I am taking as a business to the region. For example, the consequences for the water supply for a particular city or for agriculture. This also relates to human and social rights: If I import products from Bangladesh, am I putting children to work?
This aspect does not interest the Anglo-Saxon, at least the American normativity at all. There, they advocate simple climate standards, while Europe wants general standards on all ESG pillars and double materiality.
Where do the European standards go from here?
The delegated act is scheduled to come in June. We are on an extremely clear line: We want all four pillars at the same time, as we have demanded as a parliament. We would accept that certain standards be delayed in their application. I can completely understand that, for example, with human rights standards, you first have to get the value chain right and look at exactly how it’s done in Brazil or Bangladesh, that you have to have the means to control it and so on. If this can’t be done until 2026 or 2027, I have no problem with that. But I would like the rules and standards to be set now and not wait until 2026 or 2027 to do that. And then we pragmatically take the time to implement them, depending on what the companies tell us.
Why do you think the timing is so important?
Because our term ends in March 2024, after which elections will be held. The term of the Commission and the Council will also end at that time. I don’t know what will happen after that. We have a tight schedule. That’s why there is no time for postponements now.
Spanish Socialist Nicolás González Casares will be the EU Parliament’s rapporteur for electricity market reform. This was announced by the S&D group on Tuesday. Casares will thus be responsible for amending the Directive and Regulation on the internal electricity market, as well as the ACER Regulation and the Renewable Energy Directive (RED). A draft report from Parliament is expected before the end of April or May. The Commission submitted its proposal in mid-March in response to the drastic rise in electricity prices last year.
The Portuguese Maria da Graça Carvalho (EPP) had already been appointed as rapporteur for the REMIT Regulation. Yesterday, the Finnish MEP Miapetra Kumpula-Natri was appointed as shadow rapporteur for S&D.
Casares was already shadow rapporteur for the RED amendment from the Green Deal, he is considered a rather green-oriented socialist. The social democrat belongs to the governing PSOE party of Prime Minister Pedro Sanchéz and Energy Minister Teresa Ribera, under whose chairmanship in the Council the electricity market reform will probably be concluded in the second half of the year.
The Spanish government was still the driving force in the electricity market debate at EU level last year to “decouple” the price of electricity from the price of gas. In the Brussels S&D, however, Casares is seen as a team player who takes on board comments from within the group. However, even within the Socialists, MEPs from the more interventionist member states Spain, Italy and Portugal have a majority.
The German energy industry yesterday again warned against transferring too many elements from the Spanish electricity market to the entire EU. The German Renewable Energy Federation (BEE) advocated strengthening “regional flexibility options” – which means additional market remuneration for flexible generation, storage and demand. “We therefore reject a transfer of the Spanish model with mandatory introduction of rigid Contracts for Difference (CfD) to the entire EU and are counting on Casares to make concessions in the sense of finding a compromise”, BEE President Simone Peter told Table.Media.
S&D also named yesterday the shadow rapporteurs for two other important pieces of legislation. Mohammed Chahim of the Netherlands is negotiating the Critical Raw Materials Act (CRMA) on behalf of his group, while Tsvetelina Penkova of Bulgaria is negotiating the Net Zero Industry Act (NZIA). ber
Negotiations on the AI Act in the EU Parliament are entering the decisive phase. This week, two technical meetings and a meeting of the shadow rapporteurs are scheduled for the AI Act. Next week, another technical meeting and two shadow meetings are scheduled to take place. If negotiators reach an agreement, IMCO and LIBE committee votes are scheduled for April 26. Then the full committee could vote on May 31. Given the rapid developments in generative language models such as ChatGPT, time is of the essence.
Among the negotiators at the technical level is Kai Zenner from the office of EPP MEP Axel Voss. To achieve a breakthrough, all sides would have to show a willingness to compromise, Zenner tweeted on Tuesday. He also posted an overview on Twitter of which articles the negotiators have already agreed on. These were bundled into batches by the reporters.
There is apparently widespread agreement at the technical level on the controversial definition of AI. This will probably be adapted to the definitions of the OECD and the American standardization authority NIST. However, the negotiators have not yet been able to agree, among other things, on whether free and open source software (FOSS) falls within the scope of the AI Act or not. There is agreement on the establishment of a European AI Office, but not yet on the details. In general, the negotiators at the political level have thus far only ticked a few batches.
In the USA, the government is also preparing for possible regulatory measures for artificial intelligence systems; such as the large-scale voice model ChatGPT. The US IT authority NTIA is launching a public consultation on this. Responsible AI systems could bring enormous benefits, but only “if we address their potential consequences and harms”, according to an NTIA press release.
The goal of the consultation, the statement said, is to find out what measures can support the development of AI audits, assessments, certifications, and other mechanisms to build trust in AI systems. Just as food and cars only enter the market when their safety is assured, the same should be true for AI systems. vis
Lawmakers in the EU and the US have no time to lose when it comes to regulating artificial intelligence, according to a survey by digital association Bitkom. According to the survey, one in six companies in Germany (17 percent) is planning to use language models such as ChatGPT to generate text. Another 23 percent can imagine using them.
AI has the potential to “cushion the massive impact of demographic developments and the worsening shortage of skilled workers”, said Bitkom President Achim Berg. He called for technological development in AI to be driven forward in Germany and for a practical set of rules to be developed for its application in Europe and worldwide. “The current ban discussion, as initiated by the Federal Data Protection Commissioner, is completely going in the wrong direction”, Berg said.
In the survey, the majority (56 percent) of companies see AI for text generation as the “biggest digital revolution since the smartphone“, but 40 percent also see it as hype that will soon pass. Nevertheless, 70 percent expect AI for text generation to be part of everyday work in the future. vis
The Association of European Transmission System Operators (ENTSOG) published the draft of the ten-year network development plan (TYNDP) 2022 on Tuesday. Included in the new version are plans for a European hydrogen network. “The Hydrogen and Natural Gas TYNDP 2022 is the first of its kind to assess the benefits of relevant projects for decarbonized gases and demonstrates that the gas system is a resilient, efficient and cost-effective infrastructure“, ENTSOG President Piotr Kuś said.
According to ENTSOG, the current network development plan also takes into account the goals of REPowerEU from last spring. With the plan, the EU wants to diversify its import sources for natural gas and switch its supply more quickly to low-carbon gases. A consultation on the TYNDP 2022 is open until May 19.
A table on capacities of the future hydrogen infrastructure contains partly surprising data on the supply of the Federal Republic. According to the data set for Germany, Finland would become the most important import source for hydrogen as early as 2030. According to the data, future pipeline capacities from Finland would be 504 gigawatt hours per day (GWh/d), from Norway 414 GWh/d, and from the Netherlands 375 GWh/d. In contrast, the landfall capacities for ship transports of liquefied hydrogen would be significantly lower. For the German coasts, ENTSOG calculates only 228 GWh/d. ber
The deputy prime minister of the Netherlands, Sigrid Kaag, warns of dwindling public support for climate and environmental policies. This is evident, among other things, in the ongoing farmers’ protests in the country, the finance minister told the Financial Times. In times of great uncertainty, it is becoming increasingly difficult to win over the population for intergenerational measures, said Kaag, who chairs the liberal D66 party. This also applies to other EU countries, she said.
After Malta, the Netherlands is the most densely populated country in the EU with the highest livestock density. For every 17 million inhabitants, there are around eleven million pigs alone. The country has to contend with correspondingly high nitrogen emissions, which the government plans to halve by 2030. To achieve this, livestock numbers are to be drastically reduced, which is causing outrage.
“We have to deal with our decades-long inability to address the issue because it was either too sensitive or underestimated”, Kaag said. This is not a matter of partisan politics, she said, but a scientific necessity. “This is a crisis, and pretending it doesn’t exist doesn’t bring the solution any closer”. til
When classical music can be heard in the corridors of the European Parliament late at night, MEP Dennis Radtke is still in his office. There, the CDU politician has installed speakers that play Wagner, among other things, while he goes through files. Reconciling different things is part of everyday life for Radtke, who belongs to the CDU’s workers’ wing and the Christian-conservative EPP Group.
The 43-year-old sees himself in the tradition of politicians like Karl-Josef Laumann and Norbert Blüm, who made their careers in the party via the CDU social committees. Radtke, a father of two, is the contact person for the Union’s social policy in Brussels: he was co-rapporteur on the European Minimum Wage Directive, and he is the Group’s coordinator on the Committee on Employment and Social Affairs (EMPL). He is also head of the CDA in NRW and head of the CDA at EU level.
Born in Bochum, he comes from an SPD family. Both of his grandfathers were comrades for over 50 years and were active in IG Metall. Until 2002, Radtke himself held the red party member card. He later joined the CDU and the Christian Democratic Employees’ Association (CDA). After training as an industrial clerk, he became trade union secretary at the Mining, Chemical and Electronics Industrial Union (IGBCE) in Moers.
The balancing act between the Union and the CDU is not always easy for Radtke: “In the Union you’re always the black guy, and in the party you’re always the red guy”. To this day, school classes regularly ask him why he switched to the CDU. His answer: “Some of them broke windows in their youth, and my mistake was that I used to be in the SPD”.
What drives Radtke to this day are the issues of his grandfathers’ SPD, which pragmatically stood up for people with low to medium incomes. Unfortunately, that era is over. Today, he says, the SPD is too much about marginalized groups like transgender people and gender-sensitive language. “There’s nothing there for industrial jobs anymore”, Radtke says. He moved up to the EU Parliament in 2017, when Herbert Reul became interior minister of North Rhine-Westphalia. In 2019, he made it back via the state list.
On the EMPL committee, Radtke advocates for contemporary labor law issues. One major issue for him is the regulation of platform work: More than five million people are misclassified and currently registered as pseudo self-employed, he says. They would be denied access to minimum wage and social security. In addition, he says, big players like Uber have a competitive advantage over local cab companies. “It’s quite adventurous that we are only now starting to regulate these things“, says Radtke.
In the discussion on the Green New Deal, Radtke took on the Dutch Social Democrat and EU Climate Commissioner Frans Timmermanns in February. Radtke has nothing against setting ambitious climate protection targets, but worries about industrial jobs and the affordability of mobility: “The Green Deal has to happen with industry as a partner, as a driver, not as an opponent”. Leonard Schulz