Yes to oil embargo + Shipping congestion • Table.Briefings

Dear reader,

For the longest time, Germany was a blocker in the European discussion about an oil embargo against Russia. The reason for the change is likely Germany’s recent success in reducing its energy dependence on oil and coal from Russia, as the Second Energy Security Progress Report shows. The situation is still different for gas. A new law, that began to take shape over the weekend, is supposed to remedy the situation.

The notorious shipping traffic jams have formed again off China’s coasts. They have been causing headaches for European logisticians for many months, as Christiane Kühl reports. Analysts have started calling the container ships floating warehouses. Port operators in Europe expect even more confusion in 2022 than they did in 2021 because the containers are also jamming in Europe as a result of the disruptions.

In the Ukrainian port city of Mariupol, an international evacuation operation rescued several dozen civilians from the Asovstal steel plant besieged by Russian troops. Russian television told a different story: The civilians, forcibly held there by “Ukrainian Nazis”, had freed themselves. The longer Putin’s war in Ukraine lasts, the more efforts Russian propaganda makes. In my Feature “Russian media: Everything is staged” I explain how the media manipulation works.

Your
Eugenie Ankowitsch

Shipping congestion in Shanghai: ‘chaos’ also in Europe

They’re back: The infamous cargo ship jams that have repeatedly disrupted global supply chains since the pandemic began have reappeared off China’s coasts. Last Wednesday, 230 ships anchored at the shared roadstead off the ports of Shanghai and Ningbo, according to data compiled by Bloomberg. On Thursday, ship tracking we bsit e Vesselfinder already classified 296 ships as “expected” off both Ningbo and Shanghai’s ports yesterday. Some are being diverted to Shenzhen, causing ships to pile up there as well.

Shanghai’s ports continue operations in a “closed-loop” system but are isolated from the city (China.Table reported). Truck access is severely restricted. Containers currently wait an average of 12 days before being picked up via truck, according to Bloomberg. Perishable and hazardous goods are not handled at all. Conversely, export cargo does not enter the port at all.

Container ships become floating warehouses

Experts point to Shanghai’s enormous share in global goods traffic. The port processes numerous high-demand products. “Major export industries in the municipality include computer technology, automotive parts and semiconductors,” says Chris Rogers, researcher at digital freight forwarder Flexport. For computers and auto parts, Shanghai handles just over 10 percent of Chinese exports each. For semiconductors, Shanghai’s share is as high as nearly 20 percent. “Therefore, the bottleneck is a serious problem for exporters of all these goods.” The US and Europe are starting to see shortages, Rogers told China.Table. “Goods that people need are stuck on ships that are already being called ‘floating warehouses.’” From Asia to Europe, a ship now takes about 120 days instead of the usual 50.

Overall, there is a container capacity of around 25 million standard containers (TEU) worldwide, explains Philip Oetker, Chief Commercial Officer of shipping company Hamburg Sued. Of this capacity, a decreasing proportion is actually on the move on the seas, Oetker said on Thursday at a webinar of the German Chamber of Foreign Trade (AHK) in Hong Kong in cooperation with China.Table. In January 2020, around 19 million standard containers (TEU) were still in active use on ships. Today, there are only 16.5 million TEUs, Oetker said, citing a McKinsey study.

War, pandemic, and breakdowns lead to shipping congestion

The reasons for the traffic chaos at sea, which has now lasted for more than two years, are not only the COVID pandemic but also other extraordinary effects such as the grounding of the “Ever Given”. Now, the war in Ukraine diverts commodity flows and drives up costs – and not just for raw materials, which are no longer sourced from Russia. But also for the logistics sector, according to Axel Mattern, Managing Director of the Port of Hamburg – for example, through longer distances and travel times. Coal, for example, is no longer transported to Hamburg from Russia, but from Australia, Mattern said at the AHK webinar.

In any case, the role of the Covid pandemic in the situation is substantial. China accounts for about twelve percent of global trade, so the problems created by its zero-covid policy affect the entire world. Some of these are caused by additional effects, such as the Covid stimulus package from the US in 2021: This caused local demand for goods to explode, many of which come from China. However, due to cargo congestion off China’s coasts, many of the containers arriving in the US cannot return to the People’s Republic at the usual rate – neither empty, nor filled with export goods. Terminals are overflowing with containers, as is the case in Europe. There, the chaos is amplified by the proximity to the war in Ukraine. Rotterdam, Hamburg, Antwerp, and three ports in the United Kingdom are at or over capacity.

Ports are feeling the consequences. “Containers currently wait 60 percent longer than they normally would,” Thomas Luetje, Sales Director at Hamburg terminal operator HHLA, said at the webinar. “We have limited space, because terminals are designed to handle containers, not to store them.” Currently, Luetje said, six ships are waiting to dock at HHLA. “I’ve never experienced this before.”

COVID chaos at sea: little chance for improvement

It does not seem like the situation would end anytime soon. “We expect a bigger mess than last year,” Jacques Vandermeiren, CEO of the Port of Antwerp, with Europe’s second-largest container volume, said in a recent interview. “It will have a negative impact – and a big negative impact – for the whole of 2022.”

Still, overseas buyers’ expectations have been changing since early 2022, reported Sunny Ho, Director of the Hong Kong Shippers Council, at the webinar. Buyers “see Covid as almost over. While they accepted logistics operational disruptions from 2020 to 2022, today they’re saying, ‘That’s your problem, not mine.’” Buyers, for example, are now demanding again that the carrier pays for air freight if the ship is not on time. “That wasn’t the case before. And yet we have been suffering from disruptions in Shenzhen and Hong Kong for nine months, with some 400 shipments canceled. And it’s not just the lockdown itself. The consequences will be felt for a long time.”

The situation accelerates the trend toward supply chain diversification, Ho says. “Overseas buyers are asking Hong Kong suppliers to diversify their sources.”

Geopolitical risks difficult to manage for logistics companies

You can only adapt so much to geopolitical risks, says Luetje from HHLA. “But one thing is clear: all logistics operators are in the same boat.” This includes freight forwarders, shipping companies, and ports and terminals in the shipping industry. In the future, there needs to be better cooperation than before, says Luetje. In October, HHLA sold 35 percent of its Tollerort terminal to the terminal division of Chinese state shipping company COSCO and has high hopes for goods traffic with China.

Oetker of Hamburg Sued, meanwhile, would prefer to see more attention paid to logistics than before the pandemic. “Marketing or finance were considered much more relevant than logistics. Managers should better understand the complex ecosystem of logistics and also the reasons for congestion.” Luetje also hopes to see more buffer time at companies, instead of the tightly timed just-in-time production that has been the norm. Perhaps, after the end of the current crisis, customers will finally listen to logisticians. Christiane Kühl

Russian media: Everything is staged

By

Eugenie Ankowitsch

The anniversary of the Allied victory over the German Reich is approaching. While the war in Europe ended in most regions on May 8, with the unconditional surrender taking place at 11 p.m. in 1945, May 09 had already dawned in Moscow at that time. This “Victory Day” in the “Great Patriotic War”, as it is called in Russia, is of great symbolic importance in Russian society. Therefore, Western experts suspect that on this day, the Kremlin is hell-bent on announcing some kind of success in Ukraine.

Russia’s propaganda machinery is running at full speed. Since the Russian invasion of Ukraine, the main TV channels, First Channel (Pervy Kanal) and Rossia 1, broadcast almost exclusively news and political programs. These are interspersed with a few entertainment formats such as “Healthy Living” or – mostly patriotic – TV series and old film classics from the Soviet era.

“We don’t see any signs of de-escalation in Russian media,” Ruslan Deynychenko, co-founder of StopFake in Kyiv, said at an event. StopFake is a Ukrainian website that exposes misinformation about Ukraine in pro-Kremlin media. By analyzing the content of pro-Kremlin media, it is possible to “predict” certain developments in the future early on, despite the disinformation, he reported.

Further escalation expected

For example, StopFake staff had already noticed about a year before the invasion how Russian television had begun to prepare the Russian public for war. That the Russian people are currently being attuned to an end to the war is not observable, Deynychenko said. “Rather, we see indications that further escalation is to be expected.”

Whereas in the early days of the war, for example, Russian propaganda emphasized that only the military infrastructure in Ukraine was to be destroyed and concealed the destruction of civilian facilities and the dead civilians, the strategy has since changed. Now the TV reports are full of bombed ruins and dead people on the one hand and depictions of alleged or actual successes of the Russian army and the allegedly happy people in the “liberated” cities on the other.

Russia creates its own fact checks

In recent weeks, the Russian media have been working on the massacre of civilians in Bucha. However, with the opposite sign: The cruel murders in Bucha were merely a “staged provocation by the West“, they said on all communication channels loyal to the Kremlin. In numerous broadcasts and contributions, they have since been busy “proving” just that.

The supposedly investigative format “Anti-Fake” went on air for the first time on March 9. “The West oppresses Russia with a bestial hatred. Videos that evoke a storm of emotions may, in fact, turn out to be soulless and cynically produced fakes. How to distinguish lies from truth? This is what the experts of the format Anti-Fake deal with,” was the description of the program.

“We find that Russian media create their own fact checks,” confirms Raimonda Miglinaite, Information and Communication Officer, East Stratcom Task Force Information Analysis and Strategic Communications Division at the European External Action Service (EEAS). This not only helps spread disinformation but also undermines trust and sows doubt. But how exactly does this media manipulation work?

Staging accusations against Ukraine

“This is where we wage our battle against fakes and disinformation,” host Alexander Smoll welcomes viewers. This time, the studio guests who are to debunk the alleged fakes are Dmitry Sidorin, a Big Data entrepreneur and PR consultant, Timur Shafir, Executive Secretary of the Russian Journalists’ Association, and military and NATO expert Alexander Artamonov.

Once again, it is about Bucha. The focus is said to be on “completely uninvolved” people who were “groundlessly” accused of killing civilians in Bucha. An excerpt from a Ukrainian website is shown. It says that they were able to identify other soldiers who were allegedly involved in the massacre. One of them is Igor Timoshevskiy, a 29-year-old soldier, the news portal nv.ua and others say. “This person then faced not only criticism but also threats,” the anchorman is outraged.

Military expert Artamonov looks at the photo and “debunks” it on the basis of parameters such as the nature of the landscape and the ground, the soldier’s visible equipment, and the like, that the photo could never have been taken in Bucha. The unanimous conclusion of the moderator and his guests is that Timoshevskiy must be a simple soldier who has never been to Ukraine and is now being arbitrarily pilloried.

The essential information is concealed: Ukrainian media did not even claim that the photo discussed was recent and came from Bucha. In fact, under the published photo, Ukrainian media say that it came from Timoshevskiy’s profile on the Russian Facebook clone VK (short for V Kontakte, literally “in contact”). Big Data entrepreneur and reputation consultant Sidorin’s advice to people who are “innocently” confronted with such accusations is to “turn off” the Internet, go to the countryside, and plant potatoes on the dacha.

One dead girl, two stories

After this yet unexpected recommendation is about images that went around the world in early March: The video shows doctors desperately fighting for the life of a little girl. The six-year-old was reportedly injured during shelling of Mariupol by the Russian army and arrived at the emergency room in an ambulance. There she died.

The host of “Anti-Fake” announces a woman who is supposed to be the girl’s mother. Whether this is true or not cannot be verified. And then happens what is systematically operated in the Russian media: Not the Russian, but the Ukrainian armed forces had fired at the cars in which the girl and other people were sitting, the presumed mother reports in tears. Afterwards, they called an ambulance and took her to the hospital. There, media were already on the scene, ready to shoot.

The verdict of the Russian “experts” is quickly clear: The staging was “obvious”. The Ukrainian armed forces had fired on the people on purpose to subsequently stage the rescue operation in a public-spirited and professional manner and to discredit the Russian armed forces. “They are brutes,” the presenter says. As the disturbing video airs, the word fake flickers in red letters diagonally across the images several times.

And if the alleged mother is already there, then she should please confirm that the Ukrainian soldiers deliberately set up their bases in residential areas to abuse the civilians as living shields, Smoll urges the woman. And she should also deny the rumors that people from Ukraine end up in reception camps in Russia. Unsurprisingly, the woman complies with the request.

Propaganda inside Russia particularly dangerous

“In recent years, Ukraine has been the most popular target of Russian disinformation,” says Raimonda Miglinaite. About 40 percent of the registered cases of disinformation concerned Ukraine. In the three months before the Russian invasion of Ukraine, the frequency of the word Nazi alone in connection with Ukraine in the official Russian media increased by 290 percent.

According to Taras Shevchenko, Ukraine’s Deputy Minister of Culture and Information Policy, it is even more important to find ways to fight domestic Russian propaganda. “In Ukraine and also in the EU, we are sensitized and can defend ourselves quite well,” he said. The disinformation and propaganda inside Russia is far more dangerous because it has now gone largely unchallenged and is the basis for Russian popular support for the war.

Germany in favor of oil embargo – independence grows

After initial reluctance, the German government now also supports a possible European oil embargo against Russia. The Deutsche Presse-Agentur learned this from EU diplomats in Brussels over the weekend. The “Second Progress Report on Energy Security“, which the German Federal Ministry of Economic Affairs and Climate Action published on Sunday, shows that an import ban on Russian oil would now be easier for Germany to cope with than it was before the start of the Ukraine war.

According to the study, Germany has reduced its dependence on Russian oil and coal in recent weeks. Dependence on Russian oil has fallen from around 35 percent last year to 12 percent today. In the case of coal, the dependence has fallen from 50 percent to around 8 percent since the beginning of the year as a result of contract conversions. The EU had introduced an import ban on Russian coal with a transition period.

There was also progress in natural gas. Nevertheless, the share of Russian gas in German consumption remains high. Dependence on Russian gas has fallen from 55 percent to around 35 percent. The gas problem is to be remedied by a new law, which took shape over the weekend. “All these steps we are taking require an enormous joint effort by all players, and they also mean costs that will be felt by both the economy and consumers,” said Economic Affairs and Climate Action Minister Robert Habeck (Greens).

New sanctions package coming soon

In the discussion about a European oil embargo, only Hungary, Austria, and Slovakia as well as Spain, Italy and Greece, are now considered to be holding back. According to diplomats, countries such as Slovakia and Hungary have so far been opposed to a rapid import ban, primarily because of their great dependence on Russian oil supplies. In the southern European countries, meanwhile, the expected rise in energy prices for consumers following an embargo is viewed with great concern.

How the embargo plans will proceed will probably become clear in the coming days. According to dpa information, the EU Commission, under the leadership of Ursula von der Leyen, wants to present the draft for a new package of Russia sanctions as soon as possible. This is intended to once again increase the pressure on the government in Moscow because of the war against Ukraine. According to estimates by the think tank Bruegel, the EU recently imported Russian oil worth around €450 million every day.

Expropriate refinery if necessary

In eastern Germany in particular, however, the process of becoming completely independent of Russian oil is demanding. This particularly affects the refinery in Schwedt, which continues to purchase only Russian crude oil, according to the report. “Since it is majority-owned by the Russian state-owned Rosneft, a voluntary termination of supply relations with Russia is not to be expected here,” it said. If this oil was no longer wanted, Schwedt would need an alternative.

This alternative could be to place the refinery under state supervision – as in the case of the German Gazprom subsidiary. For the latter, Habeck had appointed the Federal Network Agency as trustee. However, this was done on the basis of foreign trade law and was possible because the company was to be taken over by another Russian company. Habeck had justified the trustee administration with unclear legal relationships and a breach of reporting regulations.

In Rosneft’s case, the Energy Security Act could now form the basis for state supervision. Expropriation would also be possible. The law, which was passed in 1975 in response to the oil crisis, already provided for such expropriation. In the planned amendment, however, the possibilities are to be clarified. The draft law states that expropriation could be used to secure energy supplies.

New gas law takes shape

According to the report, it will take the longest time to end Germany’s dependence on Russian gas. It had fallen to around 35 percent by mid-April. Natural gas purchases from Norway and the Netherlands have been increased, and imports of liquefied natural gas (LNG) have been “significantly” increased to make up for this.

A key building block: Several floating terminals for importing liquefied natural gas (LNG) by ship are scheduled to come on stream in Germany as early as 2022 and 2023. Other land-based LNG terminals are also in the planning process. Among others, Brunsbüttel in Schleswig-Holstein, Wilhelmshaven and Stade in Lower Saxony or Rostock in Mecklenburg-Western Pomerania are under discussion. LNG has the advantage that it can be imported by sea from various countries and is not tied to pipelines from Russia.

The Federal Ministry of Economic Affairs and Climate Action, in exchange with the Environment and Justice Ministries, has drafted a formulation aid for a bill to accelerate LNG projects in northern Germany and submitted it for departmental coordination, dpa has learned from circles within the Ministry of Economic Affairs and Climate Action.

Nabu: taking environmental risks into account

Specifically, permitting authorities are to be allowed to temporarily suspend certain requirements, such as environmental impact assessments, under special conditions. The law is to apply to floating and land-based LNG import terminals, which are to be approved and put into operation more quickly. Both variants require special infrastructure, such as connecting them to the natural gas pipeline network and, in some cases, adapting port facilities for this purpose. In contrast to the stationary facilities, the floating storage and regasification units (FSRUs) can be installed more quickly.

Jörg-Andreas Krüger, President of the Nature and Biodiversity Conservation Union of Germany (Nabu), criticized the planned law: “We are operating in extremely sensitive ecosystems in the North Sea and the Wadden Sea and in a natural World Heritage Site. Instead of passing over potential damage to the environment in a big hurry, environmental risks should be taken into account in planning.” red/dpa

EU Commission wants to ensure flow of goods from Ukraine

Ukrainian companies are to be enabled to deliver more goods to the EU by road. That’s according to the minutes of a presentation Henrik Hololei, the EU Commission’s Director-General for Mobility and Transport, gave to members of the transport committee in the EU Parliament last Thursday. The topic has already been discussed with Ukrainian Infrastructure Minister Oleksandr Kubrakov, according to the paper obtained by Europe.Table.

The Commission has asked the Council for a mandate to negotiate a road transport agreement with Ukraine and Moldova, according to Hololei. It is confident that it will be able to start negotiations with both partners without delay so that the agreements enter into force as early as in the next few weeks, the authority said. This will also involve recognizing Ukrainian driver’s licenses in the EU. “Our partners in Ukraine and Moldova need this urgently, and we need to join forces and act quickly and effectively. There is no other way.”

More transports against supply bottlenecks

The Commission wants to push this forward as quickly as possible, also against the backdrop of a looming food shortage. Ukraine produces and exports cereals and sunflower oil, among other products. According to Hololei, a shortfall in exports could affect food security in the Middle East, parts of Asia, and Africa. Therefore, Ukrainian exports should be diverted by rail, road, or inland waterways to “relevant EU freight corridors, including EU ports, for further distribution”.

The commission also wants to ensure greater safety for transport workers. For seafarers, the situation in the Black Sea and the Sea of Azov remains very worrying, as the Russian Navy “maintains a de facto blockade of this area and bombards merchant ships”. Despite having been agreed upon in the International Maritime Organization (IMO), the so-called “blue corridors” for the evacuation of ships are still not being implemented, Hololei said. luk

Industry: India’s neutral stance in war complicates cooperation

According to the Federation of German Industries (BDI), India’s neutral stance after the Russian attack on Ukraine makes political and economic cooperation with Germany more difficult. “The West must reckon with the fact that India will not assign itself to any camp in an increasingly bipolar world order,” said Wolfgang Niedermark, a member of the BDI’s executive board, on the occasion of the German-Indian government consultations in Berlin on Monday.

“In the system competition with China, Germany, and Europe, just like India, must diversify their international economic relations,” Niedermark said. Both sides need to reduce dependencies on Russia in the current situation. “This applies to European energy imports as well as to Russian-Indian military cooperation.”

For a trade agreement, India and the EU would have to approach each other. “European companies expect a secure investment environment and lower tariffs. Importing components for manufacturing needs to become cheaper to keep India attractive as an investment destination,” Niedermark said.

Call to resume free trade talks

The German Mechanical Engineering Industry Association (VDMA) appealed to the German government to push for a resumption of free trade talks between the EU and India. “The country is a major growth market in Asia and has been far too little in the focus of German and European politics,” VDMA foreign trade department head Ulrich Ackermann said on Sunday. In the view of Hildegard Müller, president of the German Association of the Automotive Industry, Monday’s talks should be used to urge India to open its market. Cooperation in the areas of raw materials and energy should also be intensified.

The 6th Indo-German intergovernmental consultations will take place in Berlin on Monday. Chancellor Olaf Scholz (SPD) will meet India’s Prime Minister Narendra Modi for bilateral exchanges and a plenary session with departmental representatives. A meeting of both with representatives of the business community is also planned.

India has so far taken a neutral stance in the Ukraine war. It has not condemned Russia’s war of aggression and does not support the sanctions. Instead, India is buying more cheap oil from Russia, for example. India also relies heavily on Moscow for its military equipment and spare parts. dpa

ACER: EU electricity market works despite high prices

The EU’s energy regulator, Acer, has come out against a far-reaching reform of Europe’s electricity markets. In a report released Friday, Acer concludes that the current design of EU wholesale markets guarantees efficient and secure electricity supply under normal conditions. “Therefore, Acer believes that the current market design should be maintained,” the report states. Thus, Acer rejects calls from countries such as Spain and France to detach the price of electricity from the price of gas.

Even though the current situation in the energy markets is not normal, it is not the design of the electricity market that is responsible, Acer writes. Rather, the electricity market design has helped protect consumers from power outages. “The current energy crisis is essentially a gas price shock that is also affecting electricity prices.” Acer advises EU countries to address the root problem of the crisis – the gas market – such as through additional imports, fuller gas storage facilities, and measures to reduce gas consumption. In addition, the most affected consumers could be targeted for relief.

Better integrate and expand the EU electricity grid

The expansion of renewable energies must be accelerated to combat high electricity prices in the future, according to Acer. Countries could also introduce a so-called pressure valve in the future – a temporary price limit that automatically comes into effect if wholesale prices rise sharply in a short period of time. In the long term, the European power grid must be better integrated and expanded to make it fit for the energy transition.

In view of the sharp rise in electricity prices, countries like France and Spain have been calling for months for the electricity pricing system to be revised. In this way, they hope that the price of electricity will be less dependent on the sharp rise in the price of gas and will fall. The wholesale price of electricity on European markets is determined by the most expensive source of energy needed – which is currently gas. If demand falls, the price is again determined by cheap renewable energy sources, as gas-fired power plants can be shut down. The system is intended to create incentives for investment in renewable energy. dpa

Decarbonization is now a strategic imperative

By Josep Borrell and Werner Hoyer

Josep Borrell (left), High Representative of the European Union for Foreign Affairs and Security Policy, is Vice President of the European Commission. Werner Hoyer (right) is President of the European Investment Bank.

The geopolitical rationale for doing so overlaps with the imperative to tackle climate change. The Intergovernmental Panel on Climate Change’s latest report on mitigation underscores the urgency of that task. Total greenhouse-gas emissions must peak by 2025 if we are to avoid a catastrophic increase in global temperatures. Moreover, the economy-wide shift to clean energy must be managed carefully to account for the inevitable social and economic consequences; it must be a “just transition”.

The EU and the European Investment Bank have a vital role to play in this transition. Investments in renewables, energy efficiency, and innovative technologies such as green hydrogen are important tools for dealing with Russia’s aggression and helping to save the planet from dependence on fossil fuels. Every euro we spend on the energy transition at home is a euro we keep out of the hands of an authoritarian power that wages aggressive war. Every euro we spend on clean energy enhances our freedom to make our own decisions. Every euro we spend helping our international partners accelerate their own decarbonization strategies is an investment in resilience and in the fight against climate change.

Mobilization at all levels

Since Russia’s invasion on February 24, the EU has been accelerating its energy transition plans to help end Europe’s reliance on Russian fossil-fuel imports as soon as possible. Although this will not happen overnight, the incentives to do so are now greater than ever. We can achieve energy independence by improving efficiency, diversifying supplies, and ramping up renewables. This process requires a mobilization at all levels – from supranational bodies down to households and individuals.

There are two important caveats to consider. First, the search for alternative suppliers of natural gas – critical as it is in the short term – must not lock us into a new long-term dependence that requires heavy investments in fossil-fuel infrastructure. That would be costly, catastrophic for the planet, and ultimately unnecessary, given the more climate-conscious options that are available. Second, we must not trade one bottleneck for another by swapping our over-dependence on fossil fuels for over-dependency on raw materials needed for the green transition. These resources are heavily concentrated in just a handful of countries, not all of which hold the same values and interests as the EU. Strengthening the EU’s strategic autonomy and resilience must remain a key objective of the transition.

Global response required

Europe cannot do this alone. Winning the battle against climate change and standing up to Russian aggression are global challenges that demand a global response. Russian President Vladimir Putin’s war has strengthened the strategic rationale for all countries to reduce their fossil-fuel imports and invest more in climate-friendly energy solutions.

That is why the EU is actively engaged in climate diplomacy. We want to encourage others to raise their climate ambitions, and we have committed considerable resources to working with partner countries so that they, too, can move to a resilient net-zero-emissions economy. Through the European Green Deal and the EU’s new Global Gateway initiative, EU institutions and member states are mobilizing up to €300 billion of investment in green and digital infrastructure to address the climate, biodiversity, and energy crises.

Moreover, the EIB has pledged to support €1 trillion of investment in climate action and environmental sustainability by 2030. Through its new development arm, EIB Global, the bank is working with partners around the world to mobilize finance for energy efficiency, renewables, and electricity grid projects.

Accelerate clean energy financing

Working as part of the EU’s joint effort under Team Europe, the EIB’s support for a clean-energy future ranges from investing in solar power in Senegal to financing more energy-efficient kindergartens in Armenia. The bank has also helped forge a Just Energy Transition Partnership with South Africa; provided backing for the India-based International Solar Alliance, which supports solar power development across 105 tropical countries; and signed on to an integrated water management and flood prevention scheme in Argentina.

The EU stands ready to support the global community in ending its dependency on fossil fuels. Russia’s war on Ukraine is not a reason to delay investments in climate action. On the contrary, more green investment will give us more strategic autonomy. Decarbonization has become a geopolitical imperative. We call on our global partners in government and across international financial institutions to join us in accelerating finance for clean energy. By pursuing climate neutrality, we can also achieve energy security.

In cooperation with Project Syndicate, 2022.

EUROPE.TABLE EDITORS

Till
Hoppe

Charlotte
Wirth

Falk
Steiner

Timo
Landenberger

Corinna
Visser

Lukas
Knigge

Eric
Bonse

Sarah
Schaefer

Manuel
Berkel

Lisa-Martina
Klein

Markus
Grabitz

Stephan
Israel

Claire
Stam

Dear reader,

For the longest time, Germany was a blocker in the European discussion about an oil embargo against Russia. The reason for the change is likely Germany’s recent success in reducing its energy dependence on oil and coal from Russia, as the Second Energy Security Progress Report shows. The situation is still different for gas. A new law, that began to take shape over the weekend, is supposed to remedy the situation.

The notorious shipping traffic jams have formed again off China’s coasts. They have been causing headaches for European logisticians for many months, as Christiane Kühl reports. Analysts have started calling the container ships floating warehouses. Port operators in Europe expect even more confusion in 2022 than they did in 2021 because the containers are also jamming in Europe as a result of the disruptions.

In the Ukrainian port city of Mariupol, an international evacuation operation rescued several dozen civilians from the Asovstal steel plant besieged by Russian troops. Russian television told a different story: The civilians, forcibly held there by “Ukrainian Nazis”, had freed themselves. The longer Putin’s war in Ukraine lasts, the more efforts Russian propaganda makes. In my Feature “Russian media: Everything is staged” I explain how the media manipulation works.

Your
Eugenie Ankowitsch

Shipping congestion in Shanghai: ‘chaos’ also in Europe

They’re back: The infamous cargo ship jams that have repeatedly disrupted global supply chains since the pandemic began have reappeared off China’s coasts. Last Wednesday, 230 ships anchored at the shared roadstead off the ports of Shanghai and Ningbo, according to data compiled by Bloomberg. On Thursday, ship tracking we bsit e Vesselfinder already classified 296 ships as “expected” off both Ningbo and Shanghai’s ports yesterday. Some are being diverted to Shenzhen, causing ships to pile up there as well.

Shanghai’s ports continue operations in a “closed-loop” system but are isolated from the city (China.Table reported). Truck access is severely restricted. Containers currently wait an average of 12 days before being picked up via truck, according to Bloomberg. Perishable and hazardous goods are not handled at all. Conversely, export cargo does not enter the port at all.

Container ships become floating warehouses

Experts point to Shanghai’s enormous share in global goods traffic. The port processes numerous high-demand products. “Major export industries in the municipality include computer technology, automotive parts and semiconductors,” says Chris Rogers, researcher at digital freight forwarder Flexport. For computers and auto parts, Shanghai handles just over 10 percent of Chinese exports each. For semiconductors, Shanghai’s share is as high as nearly 20 percent. “Therefore, the bottleneck is a serious problem for exporters of all these goods.” The US and Europe are starting to see shortages, Rogers told China.Table. “Goods that people need are stuck on ships that are already being called ‘floating warehouses.’” From Asia to Europe, a ship now takes about 120 days instead of the usual 50.

Overall, there is a container capacity of around 25 million standard containers (TEU) worldwide, explains Philip Oetker, Chief Commercial Officer of shipping company Hamburg Sued. Of this capacity, a decreasing proportion is actually on the move on the seas, Oetker said on Thursday at a webinar of the German Chamber of Foreign Trade (AHK) in Hong Kong in cooperation with China.Table. In January 2020, around 19 million standard containers (TEU) were still in active use on ships. Today, there are only 16.5 million TEUs, Oetker said, citing a McKinsey study.

War, pandemic, and breakdowns lead to shipping congestion

The reasons for the traffic chaos at sea, which has now lasted for more than two years, are not only the COVID pandemic but also other extraordinary effects such as the grounding of the “Ever Given”. Now, the war in Ukraine diverts commodity flows and drives up costs – and not just for raw materials, which are no longer sourced from Russia. But also for the logistics sector, according to Axel Mattern, Managing Director of the Port of Hamburg – for example, through longer distances and travel times. Coal, for example, is no longer transported to Hamburg from Russia, but from Australia, Mattern said at the AHK webinar.

In any case, the role of the Covid pandemic in the situation is substantial. China accounts for about twelve percent of global trade, so the problems created by its zero-covid policy affect the entire world. Some of these are caused by additional effects, such as the Covid stimulus package from the US in 2021: This caused local demand for goods to explode, many of which come from China. However, due to cargo congestion off China’s coasts, many of the containers arriving in the US cannot return to the People’s Republic at the usual rate – neither empty, nor filled with export goods. Terminals are overflowing with containers, as is the case in Europe. There, the chaos is amplified by the proximity to the war in Ukraine. Rotterdam, Hamburg, Antwerp, and three ports in the United Kingdom are at or over capacity.

Ports are feeling the consequences. “Containers currently wait 60 percent longer than they normally would,” Thomas Luetje, Sales Director at Hamburg terminal operator HHLA, said at the webinar. “We have limited space, because terminals are designed to handle containers, not to store them.” Currently, Luetje said, six ships are waiting to dock at HHLA. “I’ve never experienced this before.”

COVID chaos at sea: little chance for improvement

It does not seem like the situation would end anytime soon. “We expect a bigger mess than last year,” Jacques Vandermeiren, CEO of the Port of Antwerp, with Europe’s second-largest container volume, said in a recent interview. “It will have a negative impact – and a big negative impact – for the whole of 2022.”

Still, overseas buyers’ expectations have been changing since early 2022, reported Sunny Ho, Director of the Hong Kong Shippers Council, at the webinar. Buyers “see Covid as almost over. While they accepted logistics operational disruptions from 2020 to 2022, today they’re saying, ‘That’s your problem, not mine.’” Buyers, for example, are now demanding again that the carrier pays for air freight if the ship is not on time. “That wasn’t the case before. And yet we have been suffering from disruptions in Shenzhen and Hong Kong for nine months, with some 400 shipments canceled. And it’s not just the lockdown itself. The consequences will be felt for a long time.”

The situation accelerates the trend toward supply chain diversification, Ho says. “Overseas buyers are asking Hong Kong suppliers to diversify their sources.”

Geopolitical risks difficult to manage for logistics companies

You can only adapt so much to geopolitical risks, says Luetje from HHLA. “But one thing is clear: all logistics operators are in the same boat.” This includes freight forwarders, shipping companies, and ports and terminals in the shipping industry. In the future, there needs to be better cooperation than before, says Luetje. In October, HHLA sold 35 percent of its Tollerort terminal to the terminal division of Chinese state shipping company COSCO and has high hopes for goods traffic with China.

Oetker of Hamburg Sued, meanwhile, would prefer to see more attention paid to logistics than before the pandemic. “Marketing or finance were considered much more relevant than logistics. Managers should better understand the complex ecosystem of logistics and also the reasons for congestion.” Luetje also hopes to see more buffer time at companies, instead of the tightly timed just-in-time production that has been the norm. Perhaps, after the end of the current crisis, customers will finally listen to logisticians. Christiane Kühl

Russian media: Everything is staged

By

Eugenie Ankowitsch

The anniversary of the Allied victory over the German Reich is approaching. While the war in Europe ended in most regions on May 8, with the unconditional surrender taking place at 11 p.m. in 1945, May 09 had already dawned in Moscow at that time. This “Victory Day” in the “Great Patriotic War”, as it is called in Russia, is of great symbolic importance in Russian society. Therefore, Western experts suspect that on this day, the Kremlin is hell-bent on announcing some kind of success in Ukraine.

Russia’s propaganda machinery is running at full speed. Since the Russian invasion of Ukraine, the main TV channels, First Channel (Pervy Kanal) and Rossia 1, broadcast almost exclusively news and political programs. These are interspersed with a few entertainment formats such as “Healthy Living” or – mostly patriotic – TV series and old film classics from the Soviet era.

“We don’t see any signs of de-escalation in Russian media,” Ruslan Deynychenko, co-founder of StopFake in Kyiv, said at an event. StopFake is a Ukrainian website that exposes misinformation about Ukraine in pro-Kremlin media. By analyzing the content of pro-Kremlin media, it is possible to “predict” certain developments in the future early on, despite the disinformation, he reported.

Further escalation expected

For example, StopFake staff had already noticed about a year before the invasion how Russian television had begun to prepare the Russian public for war. That the Russian people are currently being attuned to an end to the war is not observable, Deynychenko said. “Rather, we see indications that further escalation is to be expected.”

Whereas in the early days of the war, for example, Russian propaganda emphasized that only the military infrastructure in Ukraine was to be destroyed and concealed the destruction of civilian facilities and the dead civilians, the strategy has since changed. Now the TV reports are full of bombed ruins and dead people on the one hand and depictions of alleged or actual successes of the Russian army and the allegedly happy people in the “liberated” cities on the other.

Russia creates its own fact checks

In recent weeks, the Russian media have been working on the massacre of civilians in Bucha. However, with the opposite sign: The cruel murders in Bucha were merely a “staged provocation by the West“, they said on all communication channels loyal to the Kremlin. In numerous broadcasts and contributions, they have since been busy “proving” just that.

The supposedly investigative format “Anti-Fake” went on air for the first time on March 9. “The West oppresses Russia with a bestial hatred. Videos that evoke a storm of emotions may, in fact, turn out to be soulless and cynically produced fakes. How to distinguish lies from truth? This is what the experts of the format Anti-Fake deal with,” was the description of the program.

“We find that Russian media create their own fact checks,” confirms Raimonda Miglinaite, Information and Communication Officer, East Stratcom Task Force Information Analysis and Strategic Communications Division at the European External Action Service (EEAS). This not only helps spread disinformation but also undermines trust and sows doubt. But how exactly does this media manipulation work?

Staging accusations against Ukraine

“This is where we wage our battle against fakes and disinformation,” host Alexander Smoll welcomes viewers. This time, the studio guests who are to debunk the alleged fakes are Dmitry Sidorin, a Big Data entrepreneur and PR consultant, Timur Shafir, Executive Secretary of the Russian Journalists’ Association, and military and NATO expert Alexander Artamonov.

Once again, it is about Bucha. The focus is said to be on “completely uninvolved” people who were “groundlessly” accused of killing civilians in Bucha. An excerpt from a Ukrainian website is shown. It says that they were able to identify other soldiers who were allegedly involved in the massacre. One of them is Igor Timoshevskiy, a 29-year-old soldier, the news portal nv.ua and others say. “This person then faced not only criticism but also threats,” the anchorman is outraged.

Military expert Artamonov looks at the photo and “debunks” it on the basis of parameters such as the nature of the landscape and the ground, the soldier’s visible equipment, and the like, that the photo could never have been taken in Bucha. The unanimous conclusion of the moderator and his guests is that Timoshevskiy must be a simple soldier who has never been to Ukraine and is now being arbitrarily pilloried.

The essential information is concealed: Ukrainian media did not even claim that the photo discussed was recent and came from Bucha. In fact, under the published photo, Ukrainian media say that it came from Timoshevskiy’s profile on the Russian Facebook clone VK (short for V Kontakte, literally “in contact”). Big Data entrepreneur and reputation consultant Sidorin’s advice to people who are “innocently” confronted with such accusations is to “turn off” the Internet, go to the countryside, and plant potatoes on the dacha.

One dead girl, two stories

After this yet unexpected recommendation is about images that went around the world in early March: The video shows doctors desperately fighting for the life of a little girl. The six-year-old was reportedly injured during shelling of Mariupol by the Russian army and arrived at the emergency room in an ambulance. There she died.

The host of “Anti-Fake” announces a woman who is supposed to be the girl’s mother. Whether this is true or not cannot be verified. And then happens what is systematically operated in the Russian media: Not the Russian, but the Ukrainian armed forces had fired at the cars in which the girl and other people were sitting, the presumed mother reports in tears. Afterwards, they called an ambulance and took her to the hospital. There, media were already on the scene, ready to shoot.

The verdict of the Russian “experts” is quickly clear: The staging was “obvious”. The Ukrainian armed forces had fired on the people on purpose to subsequently stage the rescue operation in a public-spirited and professional manner and to discredit the Russian armed forces. “They are brutes,” the presenter says. As the disturbing video airs, the word fake flickers in red letters diagonally across the images several times.

And if the alleged mother is already there, then she should please confirm that the Ukrainian soldiers deliberately set up their bases in residential areas to abuse the civilians as living shields, Smoll urges the woman. And she should also deny the rumors that people from Ukraine end up in reception camps in Russia. Unsurprisingly, the woman complies with the request.

Propaganda inside Russia particularly dangerous

“In recent years, Ukraine has been the most popular target of Russian disinformation,” says Raimonda Miglinaite. About 40 percent of the registered cases of disinformation concerned Ukraine. In the three months before the Russian invasion of Ukraine, the frequency of the word Nazi alone in connection with Ukraine in the official Russian media increased by 290 percent.

According to Taras Shevchenko, Ukraine’s Deputy Minister of Culture and Information Policy, it is even more important to find ways to fight domestic Russian propaganda. “In Ukraine and also in the EU, we are sensitized and can defend ourselves quite well,” he said. The disinformation and propaganda inside Russia is far more dangerous because it has now gone largely unchallenged and is the basis for Russian popular support for the war.

Germany in favor of oil embargo – independence grows

After initial reluctance, the German government now also supports a possible European oil embargo against Russia. The Deutsche Presse-Agentur learned this from EU diplomats in Brussels over the weekend. The “Second Progress Report on Energy Security“, which the German Federal Ministry of Economic Affairs and Climate Action published on Sunday, shows that an import ban on Russian oil would now be easier for Germany to cope with than it was before the start of the Ukraine war.

According to the study, Germany has reduced its dependence on Russian oil and coal in recent weeks. Dependence on Russian oil has fallen from around 35 percent last year to 12 percent today. In the case of coal, the dependence has fallen from 50 percent to around 8 percent since the beginning of the year as a result of contract conversions. The EU had introduced an import ban on Russian coal with a transition period.

There was also progress in natural gas. Nevertheless, the share of Russian gas in German consumption remains high. Dependence on Russian gas has fallen from 55 percent to around 35 percent. The gas problem is to be remedied by a new law, which took shape over the weekend. “All these steps we are taking require an enormous joint effort by all players, and they also mean costs that will be felt by both the economy and consumers,” said Economic Affairs and Climate Action Minister Robert Habeck (Greens).

New sanctions package coming soon

In the discussion about a European oil embargo, only Hungary, Austria, and Slovakia as well as Spain, Italy and Greece, are now considered to be holding back. According to diplomats, countries such as Slovakia and Hungary have so far been opposed to a rapid import ban, primarily because of their great dependence on Russian oil supplies. In the southern European countries, meanwhile, the expected rise in energy prices for consumers following an embargo is viewed with great concern.

How the embargo plans will proceed will probably become clear in the coming days. According to dpa information, the EU Commission, under the leadership of Ursula von der Leyen, wants to present the draft for a new package of Russia sanctions as soon as possible. This is intended to once again increase the pressure on the government in Moscow because of the war against Ukraine. According to estimates by the think tank Bruegel, the EU recently imported Russian oil worth around €450 million every day.

Expropriate refinery if necessary

In eastern Germany in particular, however, the process of becoming completely independent of Russian oil is demanding. This particularly affects the refinery in Schwedt, which continues to purchase only Russian crude oil, according to the report. “Since it is majority-owned by the Russian state-owned Rosneft, a voluntary termination of supply relations with Russia is not to be expected here,” it said. If this oil was no longer wanted, Schwedt would need an alternative.

This alternative could be to place the refinery under state supervision – as in the case of the German Gazprom subsidiary. For the latter, Habeck had appointed the Federal Network Agency as trustee. However, this was done on the basis of foreign trade law and was possible because the company was to be taken over by another Russian company. Habeck had justified the trustee administration with unclear legal relationships and a breach of reporting regulations.

In Rosneft’s case, the Energy Security Act could now form the basis for state supervision. Expropriation would also be possible. The law, which was passed in 1975 in response to the oil crisis, already provided for such expropriation. In the planned amendment, however, the possibilities are to be clarified. The draft law states that expropriation could be used to secure energy supplies.

New gas law takes shape

According to the report, it will take the longest time to end Germany’s dependence on Russian gas. It had fallen to around 35 percent by mid-April. Natural gas purchases from Norway and the Netherlands have been increased, and imports of liquefied natural gas (LNG) have been “significantly” increased to make up for this.

A key building block: Several floating terminals for importing liquefied natural gas (LNG) by ship are scheduled to come on stream in Germany as early as 2022 and 2023. Other land-based LNG terminals are also in the planning process. Among others, Brunsbüttel in Schleswig-Holstein, Wilhelmshaven and Stade in Lower Saxony or Rostock in Mecklenburg-Western Pomerania are under discussion. LNG has the advantage that it can be imported by sea from various countries and is not tied to pipelines from Russia.

The Federal Ministry of Economic Affairs and Climate Action, in exchange with the Environment and Justice Ministries, has drafted a formulation aid for a bill to accelerate LNG projects in northern Germany and submitted it for departmental coordination, dpa has learned from circles within the Ministry of Economic Affairs and Climate Action.

Nabu: taking environmental risks into account

Specifically, permitting authorities are to be allowed to temporarily suspend certain requirements, such as environmental impact assessments, under special conditions. The law is to apply to floating and land-based LNG import terminals, which are to be approved and put into operation more quickly. Both variants require special infrastructure, such as connecting them to the natural gas pipeline network and, in some cases, adapting port facilities for this purpose. In contrast to the stationary facilities, the floating storage and regasification units (FSRUs) can be installed more quickly.

Jörg-Andreas Krüger, President of the Nature and Biodiversity Conservation Union of Germany (Nabu), criticized the planned law: “We are operating in extremely sensitive ecosystems in the North Sea and the Wadden Sea and in a natural World Heritage Site. Instead of passing over potential damage to the environment in a big hurry, environmental risks should be taken into account in planning.” red/dpa

EU Commission wants to ensure flow of goods from Ukraine

Ukrainian companies are to be enabled to deliver more goods to the EU by road. That’s according to the minutes of a presentation Henrik Hololei, the EU Commission’s Director-General for Mobility and Transport, gave to members of the transport committee in the EU Parliament last Thursday. The topic has already been discussed with Ukrainian Infrastructure Minister Oleksandr Kubrakov, according to the paper obtained by Europe.Table.

The Commission has asked the Council for a mandate to negotiate a road transport agreement with Ukraine and Moldova, according to Hololei. It is confident that it will be able to start negotiations with both partners without delay so that the agreements enter into force as early as in the next few weeks, the authority said. This will also involve recognizing Ukrainian driver’s licenses in the EU. “Our partners in Ukraine and Moldova need this urgently, and we need to join forces and act quickly and effectively. There is no other way.”

More transports against supply bottlenecks

The Commission wants to push this forward as quickly as possible, also against the backdrop of a looming food shortage. Ukraine produces and exports cereals and sunflower oil, among other products. According to Hololei, a shortfall in exports could affect food security in the Middle East, parts of Asia, and Africa. Therefore, Ukrainian exports should be diverted by rail, road, or inland waterways to “relevant EU freight corridors, including EU ports, for further distribution”.

The commission also wants to ensure greater safety for transport workers. For seafarers, the situation in the Black Sea and the Sea of Azov remains very worrying, as the Russian Navy “maintains a de facto blockade of this area and bombards merchant ships”. Despite having been agreed upon in the International Maritime Organization (IMO), the so-called “blue corridors” for the evacuation of ships are still not being implemented, Hololei said. luk

Industry: India’s neutral stance in war complicates cooperation

According to the Federation of German Industries (BDI), India’s neutral stance after the Russian attack on Ukraine makes political and economic cooperation with Germany more difficult. “The West must reckon with the fact that India will not assign itself to any camp in an increasingly bipolar world order,” said Wolfgang Niedermark, a member of the BDI’s executive board, on the occasion of the German-Indian government consultations in Berlin on Monday.

“In the system competition with China, Germany, and Europe, just like India, must diversify their international economic relations,” Niedermark said. Both sides need to reduce dependencies on Russia in the current situation. “This applies to European energy imports as well as to Russian-Indian military cooperation.”

For a trade agreement, India and the EU would have to approach each other. “European companies expect a secure investment environment and lower tariffs. Importing components for manufacturing needs to become cheaper to keep India attractive as an investment destination,” Niedermark said.

Call to resume free trade talks

The German Mechanical Engineering Industry Association (VDMA) appealed to the German government to push for a resumption of free trade talks between the EU and India. “The country is a major growth market in Asia and has been far too little in the focus of German and European politics,” VDMA foreign trade department head Ulrich Ackermann said on Sunday. In the view of Hildegard Müller, president of the German Association of the Automotive Industry, Monday’s talks should be used to urge India to open its market. Cooperation in the areas of raw materials and energy should also be intensified.

The 6th Indo-German intergovernmental consultations will take place in Berlin on Monday. Chancellor Olaf Scholz (SPD) will meet India’s Prime Minister Narendra Modi for bilateral exchanges and a plenary session with departmental representatives. A meeting of both with representatives of the business community is also planned.

India has so far taken a neutral stance in the Ukraine war. It has not condemned Russia’s war of aggression and does not support the sanctions. Instead, India is buying more cheap oil from Russia, for example. India also relies heavily on Moscow for its military equipment and spare parts. dpa

ACER: EU electricity market works despite high prices

The EU’s energy regulator, Acer, has come out against a far-reaching reform of Europe’s electricity markets. In a report released Friday, Acer concludes that the current design of EU wholesale markets guarantees efficient and secure electricity supply under normal conditions. “Therefore, Acer believes that the current market design should be maintained,” the report states. Thus, Acer rejects calls from countries such as Spain and France to detach the price of electricity from the price of gas.

Even though the current situation in the energy markets is not normal, it is not the design of the electricity market that is responsible, Acer writes. Rather, the electricity market design has helped protect consumers from power outages. “The current energy crisis is essentially a gas price shock that is also affecting electricity prices.” Acer advises EU countries to address the root problem of the crisis – the gas market – such as through additional imports, fuller gas storage facilities, and measures to reduce gas consumption. In addition, the most affected consumers could be targeted for relief.

Better integrate and expand the EU electricity grid

The expansion of renewable energies must be accelerated to combat high electricity prices in the future, according to Acer. Countries could also introduce a so-called pressure valve in the future – a temporary price limit that automatically comes into effect if wholesale prices rise sharply in a short period of time. In the long term, the European power grid must be better integrated and expanded to make it fit for the energy transition.

In view of the sharp rise in electricity prices, countries like France and Spain have been calling for months for the electricity pricing system to be revised. In this way, they hope that the price of electricity will be less dependent on the sharp rise in the price of gas and will fall. The wholesale price of electricity on European markets is determined by the most expensive source of energy needed – which is currently gas. If demand falls, the price is again determined by cheap renewable energy sources, as gas-fired power plants can be shut down. The system is intended to create incentives for investment in renewable energy. dpa

Decarbonization is now a strategic imperative

By Josep Borrell and Werner Hoyer

The geopolitical rationale for doing so overlaps with the imperative to tackle climate change. The Intergovernmental Panel on Climate Change’s latest report on mitigation underscores the urgency of that task. Total greenhouse-gas emissions must peak by 2025 if we are to avoid a catastrophic increase in global temperatures. Moreover, the economy-wide shift to clean energy must be managed carefully to account for the inevitable social and economic consequences; it must be a “just transition”.

The EU and the European Investment Bank have a vital role to play in this transition. Investments in renewables, energy efficiency, and innovative technologies such as green hydrogen are important tools for dealing with Russia’s aggression and helping to save the planet from dependence on fossil fuels. Every euro we spend on the energy transition at home is a euro we keep out of the hands of an authoritarian power that wages aggressive war. Every euro we spend on clean energy enhances our freedom to make our own decisions. Every euro we spend helping our international partners accelerate their own decarbonization strategies is an investment in resilience and in the fight against climate change.

Mobilization at all levels

Since Russia’s invasion on February 24, the EU has been accelerating its energy transition plans to help end Europe’s reliance on Russian fossil-fuel imports as soon as possible. Although this will not happen overnight, the incentives to do so are now greater than ever. We can achieve energy independence by improving efficiency, diversifying supplies, and ramping up renewables. This process requires a mobilization at all levels – from supranational bodies down to households and individuals.

There are two important caveats to consider. First, the search for alternative suppliers of natural gas – critical as it is in the short term – must not lock us into a new long-term dependence that requires heavy investments in fossil-fuel infrastructure. That would be costly, catastrophic for the planet, and ultimately unnecessary, given the more climate-conscious options that are available. Second, we must not trade one bottleneck for another by swapping our over-dependence on fossil fuels for over-dependency on raw materials needed for the green transition. These resources are heavily concentrated in just a handful of countries, not all of which hold the same values and interests as the EU. Strengthening the EU’s strategic autonomy and resilience must remain a key objective of the transition.

Global response required

Europe cannot do this alone. Winning the battle against climate change and standing up to Russian aggression are global challenges that demand a global response. Russian President Vladimir Putin’s war has strengthened the strategic rationale for all countries to reduce their fossil-fuel imports and invest more in climate-friendly energy solutions.

That is why the EU is actively engaged in climate diplomacy. We want to encourage others to raise their climate ambitions, and we have committed considerable resources to working with partner countries so that they, too, can move to a resilient net-zero-emissions economy. Through the European Green Deal and the EU’s new Global Gateway initiative, EU institutions and member states are mobilizing up to €300 billion of investment in green and digital infrastructure to address the climate, biodiversity, and energy crises.

Moreover, the EIB has pledged to support €1 trillion of investment in climate action and environmental sustainability by 2030. Through its new development arm, EIB Global, the bank is working with partners around the world to mobilize finance for energy efficiency, renewables, and electricity grid projects.

Accelerate clean energy financing

Working as part of the EU’s joint effort under Team Europe, the EIB’s support for a clean-energy future ranges from investing in solar power in Senegal to financing more energy-efficient kindergartens in Armenia. The bank has also helped forge a Just Energy Transition Partnership with South Africa; provided backing for the India-based International Solar Alliance, which supports solar power development across 105 tropical countries; and signed on to an integrated water management and flood prevention scheme in Argentina.

The EU stands ready to support the global community in ending its dependency on fossil fuels. Russia’s war on Ukraine is not a reason to delay investments in climate action. On the contrary, more green investment will give us more strategic autonomy. Decarbonization has become a geopolitical imperative. We call on our global partners in government and across international financial institutions to join us in accelerating finance for clean energy. By pursuing climate neutrality, we can also achieve energy security.

In cooperation with Project Syndicate, 2022.