Rasim Huseynov
Managing Editor of Seamless Trade and International Trade Consultant at Tevolution Ltd
As COP29 approaches, reflecting on the developments since COP28, two significant grievances remain at the forefront: the imposition of unilateral environmental measures and the chronic lack of financial support for climate action. Unfortunately, over the past 12 months, the world has not grown closer but has become more divided. This division persists even as the climate emergency demands tough decisions with significant financial implications, compounded by ongoing wars and global uncertainty.
The Success of Multilateral Environmental Agreements
The last three decades have seen notable successes in multilateral environmental agreements, such as the Paris Agreement, which represent broad coalitions with a high degree of flexibility. These agreements have helped establish global frameworks for action, allowing countries to collaborate on shared goals. However, this progress has been accompanied by a rise in national-level environmental regulation and the emergence of environmental parties in politics, which has created a new political landscape.
Yet, as the threat of climate catastrophe looms ever closer, the stakes are rising, and tensions are growing. Environmental issues, so vital to the world’s survival, have become politically charged and even ideologically partisan. What was once seen as a global effort is now subject to increasing polarisation.
The EU’s Role as a Regulatory Powerhouse
The European Union (EU) stands at the forefront of environmental regulation. As a highly developed customs union, the EU benefits from an intricate regulatory system that few regions can match. Its influence is particularly strong in areas such as chemical safety (via REACH), carbon emissions (through the Emission Trading System), and biodiversity protection. These initiatives position the EU uniquely to push global standards, particularly in environmental regulation.
The breathtaking pace at which these regulations have been implemented showcases the EU's organisational and legal capacity. Unlike past empires that relied on force or intimidation, the EU’s regulatory influence comes from the persuasive power of its market. This strategy aligns with a modern, peace-oriented democratic system. If countries could adopt a more consultative and combined approach—reducing divergence—the transaction costs for trade could be lowered, creating a double benefit: both environmental and financial.
However, bridging the gap in perspectives between countries—particularly regarding historical emissions and current responsibilities—remains a significant challenge.
Unilateral Measures and Historical Grievances
The reliance on unilateral measures—such as the EU’s Carbon Border Adjustment Mechanism (CBAM) or deforestation regulations—can revive historical grievances. In many regions, these measures may be seen as new forms of control, triggering mistrust and resentment. While the EU’s approach is technically peaceful and market-driven, it still evokes memories of unequal power dynamics.
Using the EU’s economic clout to raise environmental standards and protect the planet is commendable. This approach is not inconsistent with the EU’s active involvement in promoting major multilateral environmental agreements, like the Paris Agreement. However, finding the right balance between unilateral action and multilateral cooperation will be key to sustaining global environmental progress.
As Anu Bradford outlines in her analysis of the Brussels Effect, the EU’s regulations often set global standards because multinational corporations and other countries adapt to meet these rules to maintain access to the EU market. Three flagship regulations—RoHS, WEEE, and ETS—illustrate how the EU’s influence extends well beyond its borders, elevating global standards and creating a new benchmark for environmental regulation. However, one key lesson is the limitations of unilateral air emissions regulation, which demonstrated that such approaches may fall short without broader cooperation. This example offers valuable insights for future policy.
Economic Challenges and the EU’s Shrinking Influence
One of the critical factors in the EU's ability to set global standards is its economic strength. The shrinking market and decline in purchasing power within the EU could limit its regulatory influence in the future. Consumer prosperity is central to the EU’s regulatory might. As the EU’s economic dominance wanes, so too could its ability to shape global standards. The longevity of this influence will depend not only on regulatory clarity but also on the EU maintaining its economic attractiveness.
The Importance of Collaboration and Trust
While the EU’s current strategy relies heavily on unilateral measures, sustainable global environmental solutions will require collaboration and trust-building with other major players. Although the EU can set the bar for environmental regulation, true progress requires cooperation with emerging economies and developing countries.
A one-size-fits-all approach is not feasible for several reasons. Developing countries have not contributed to environmental degradation at the same level as industrial powers, and their developmental needs require a balanced approach. However, this does not mean their contribution should remain artificially low, particularly for fast-growing economies.
Additionally, developing countries lack the financial resources required for green transitions and climate adaptation. They also do not have the same level of regulatory capacity as developed economies, which benefit from extensive expertise and resources.
A Call for Rationality and Collaboration
As COP29 approaches, there is no room for another missed opportunity. The world’s leaders must seize this moment to bridge divides and create real, lasting solutions. Only through collaboration and mutual trust can we overcome the divisions and meet the challenges of the climate crisis head-on. The stakes are too high for inaction, and the cost of failure will be borne by future generations. I’m not only keeping my fingers crossed but also look forward to reflecting on intense debates that lie ahead.
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