Policy Paper §7: Circular Solutions to Telecoupled Externalities of EU’s Green Economy Transition, Teodor Kalpakchiev, the-enpi.org
Globalization has triggered an enormous momentum in coordinating global value chains. However, as microeconomic optimization does not necessarily internalize ecological or anthropocentric concerns, subjecting trade to a range of instruments such as voluntary certifications, international agreements, collaborative and participatory mechanisms, tariff and non-tariff barriers is meant to adjust the negative environmental effects of EU’s domestic greening of the economy.
Long-distance relationships designated as telecoupling are oftentimes caused by the drive for sustainability leadership in the EU, which counts on redistribution of wealth towards renewable energy, renewing resource flows, optimizing resource use, etc. However, as land on the continent is relatively scarce and there is competition for its use (e.g. urbanization, food, biofuels, photovoltaic plants), which forces is to count on imports of biofuels from Eastern Europe or further, of renewable energy from North Africa, but also leads to excesses in (oftentimes processed) food that is shipped towards the rest of the world, while wholemeal grains, fruits and vegetables with little to no added value for the produced (had it not been for the fairtrade certification schemes) are imported. Agents working within these relationships are government officials, shipment and logistics companies, workers unions as well as companies acquiring land both within the EU and abroad.
Effects that manifest telecoupling of anthropocentric governance and the ecological balance are, for example, EU’s rising environments for the increase of biofuels within the transport mix, heavy planting of palm oil, maize, sugarcane that damage traditional subsistence and the structure of the economy. Oftentimes the plantations are used as cash crops that induce energy in bioplants, while having additional exhaustive effects on the soil and are polluting rivers and the rest of the environment with pesticides. In target countries, telecoupling also results in blurring the rural-urban divide, as increased travels between those in order to sell/buy necessary resources produce new emissions (oftentimes from old vehicles).
The question is whether and which instruments the EU could use to induce a more nuanced trading regime that makes use of the non-reciprocal relationship towards countries in need of economic growth, but with stagnant governance reforms. Interestingly, post-sovereign formations elsewhere oftentimes forego the ability to adjust such responses to global demand, as with a non-completed single market, reduced regulatory capacity and oftentimes insufficient transfer of sovereignty they do not manage to induce action in state actors. Hereby come handy namely the horizontal and vertical anthropocentric coordination efforts, as they aim to improve the understanding of local externalities of the EU’s external trade regime. These feedback loops are meant to derive the causal relationships that exist and potentially address them.
From the perspective of distant flows of goods that induce carbon emissions from transportation, as well as the intensified land use, a circular approach would entail greater use of the principle of bio-regionalism, resp. local sourcing of goods, which in this case would mean preference for goods produced in the vicinity. This can be done via EU Neighbourhood-wide labelling for origin, as well as differentiated tariffs between associated and countries with no particular status. For example, nuts grown in North Africa would receive preference than those grown in South America. When we speak of waste shipments, resp. end-of-live vehicles or computers that are oftentimes intended for repairs in Africa, but end on dumpsites, there should be sufficient waste processing facilities, whose secondary market resources should have preferential buyout prices on the EU market. The same would apply to biofuels, which are normally shipped from sugarcane grown in Brazil or Palm Oil grown in South-East Asia. These can easily be substituted with reprocessed oil for cooking that’s collected from industrial production sites and franchise chains. As for biofuels produced, e.g. in everything but arms countries or simply trade partners, these should be preferably redirected to the closest possible country where demand exists. In order to avoid damage to soils and land, DG Trade could assign a label or tariff reduction for crops rotation and bio-production.
Additionally, from a governance perspective one should deem the expansion of carbon-wide emissions and forestry clean development mechanisms (EU ETS, FLEGT) by incorporating the EU neighbourhood. To achieve faster replication of circular solutions, a city-to-city network between EU’s Eurozone core, its eastern European periphery and the neighbourhood should be established, whereby each of the three cities should be a rotating coordinator of green transition initiatives. While this would ensure learning on the micro scale, the Committee of Regions could ensure mutual learning through horizontal sector-focused collaborative epistemic networks. The normative approach of communicating EU’s external policy should therefore include messages such as that the EU supports the regional economic integration of distant economies through green transition initiatives, thus embedding a values-driven policy mechanism into its trade-for-aid aspirations.
- Embedding bioregionalism through labelling, certification and tariff schemes
- Tri-city policy partnership with rotating presidency
- Incorporate neighbourhood countries into clean development mechanisms
- Ensure sufficient waste treatment capacities in partners and facilitate secondary material imports
- Use visualization and communication tools to ensure wider awareness of spill-over systems as triggers and regulators of telecoupling