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France is prepared to requisition “personnel, stocks or production tools” to accelerate the production of armaments by the domestic industry, the Minister for Armed Forces Sébastien Lecornu said on Tuesday (26 March).

“For the first time, I’m not ruling out (…), if things are not on track in terms of production rate and lead times, to make requisitions if necessary or to use the right of prioritisation,” Lecornu said at a press conference on Tuesday.

These requisitions could concern personnel, stocks, and other production tools, or require manufacturers to give priority to military requirements over civilian needs, the minister said.

France could “within the next few weeks” give priority to military orders over civilian requirements, and impose minimum stock levels on certain manufacturers, he added.

EU member states have recently started stepping up efforts towards a ‘war economy mode’ for the bloc after the European Commission last month proposed a Defence Industry Programme (EDIP) to revamp the bloc’s military-industrial complex to support European and Ukrainian military needs for the long haul.

Key measures of the EU’s plans feature reserves of supply, as well as priority-rated orders – a mechanism whereby defence industries would get priority in case a shortage of civilian or dual-use components should threaten the availability of defence supply.

The latter was rejected by EU countries last year in the context of the negotiations of the Act in Support of Ammunition (ASAP) to help boost ammo production across the bloc.

The French military defence bill for 2024-2030, voted in August, states that in the event of an “actual or foreseeable threat to activities essential to the life of the nation”, or a threat to “the protection of the population”, the government can decide on the requisition of any person, natural or legal, and of all the goods and services necessary.

Such a war effort could be justified by the tense “security context”, Lecornu said.

“The war in Ukraine has thrown us back into a form of Cold War (…) against the backdrop of Russia’s nuclear arsenal.”

Lecornu also referred to a heightened level of a “terrorist threat”, following the attack in Russia last week, which killed almost 140 people.

French President Emmanuel Macron said in January the European defence industry should be “in war economy mode, with a faster and stronger production capacity”.

“If production rates are sometimes too slow, it’s because there’s a temptation to work on a just-in-time basis and not hold sufficient stocks of raw materials or components”, to avoid tying up cash needed to build up these stocks, Lecornu said.

The French defence minister also complained that the delivery times for the Aster long-range anti-aircraft missile, produced between France and Italy, are too long.

“The question of MBDA’s subcontractors prioritising the military order for the Aster missile over a civilian order is obviously something we can look at completely,” he said.

France ordered 200 Aster missiles in January 2023 for €900 million, with delivery scheduled for 2026. These missiles, which according to Lecornu, “were not previously used or were just used for training purposes”, are now being supplied to Ukraine.

“We now have concrete operational contracts on which we are bidding,” he said, announcing an “advance order” for 200 additional Aster missiles.

Source: Euractiv.com

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With China and the US striving to dominate the world’s future clean-tech markets, European politicians have developed a renewed appetite for protectionism and Europe’s wind power industry is poised to harvest this drive.

To recap: Europe was scarred when the global financial crisis – alongside bad business choices driven by the gold rush mood of the first feed-in tariffs – saw the solar photovoltaic supply chain move to China.

When EU policymakers realised in the summer of 2022 that the US planned to subsidise clean technologies at scale, panic set in.

The EU’s Net-Zero Industry Act (NZIA) – the bloc’s paltry protectionist response, not backed by much money – is due to be voted on by the European Parliament on 23 April.

The law now lists a whopping 18 technology categories where the EU wants to produce 40% of annual deployment needs by 2030, but this ambition is neither serious nor realistic.

These include traditional technologies like solar and wind, but also a swathe of nuclear categories, as well as “wind propulsion and electric propulsion.”

The NZIA is more of a shotgun than a scalpel, more bazooka than targeted measure. Given the EU’s limited fiscal headway – Europe is embracing a return to more austere budgets as we speak – a certain prioritisation is in order.

Europe’s wind power industry has successfully convinced policymakers to treat it like a beloved only child. Commission boss Ursula von der Leyen called it a “European success story” in her annual address to the EU.

“The future of our clean-tech industry has to be made in Europe,” she stressed. Appetite for protectionism, indeed.

European “clean-tech” lobbyists have seized on this. Their common refrain is that they will eventually be swallowed by China, where labour is cheap, regulations limited, domestic markets large, and cash bountiful.

But not all industries are the same, nor do they have the same starting point—attempting to apply the same strict 40% threshold to them all risks becoming a waste of resources.

The wind industry benefits from wind turbines being a high-tech product where most of the labour occurs during manufacturing – unlike solar, where most jobs are in installation and maintenance. Whether Chinese, Indian, or European panels are getting installed doesn’t matter much for jobs.

Locating wind turbine factories in Europe matters. Some 200 pairs of hands touch a turbine blade before it is shipped out of a factory in Spain, including a full-time position for a man with a mop whose task is to smooth out potential wrinkles in the blade’s structure.

Two-thirds of the jobs in the wind value chain are in production.

This may change when wind turbine production schemes are settled, and innovation becomes less transformative. But it is not yet in sight, turbines keep getting bigger and better.

The rest of the wind value chain, which employs 300,000 people in Europe, is spread across more than half of Europe, ranging from small countries to heavyweights. Plenty of points in the wind industry’s favour.

Other technologies are more niche or promise fewer photo-ops in the short term. The first nuclear power plant built thanks to protectionism will generate power in the late 2030s, if at all.

Finland’s Olkiluoto 3 started construction in 2005 before finishing in 2022. The NZIA will enter into force this year. 16 years to go before 2040. How many “Made in Europe” nuclear power plants will be constructed in that timeframe?.

Batteries are another sector in which EU countries have just begun clawing back market share from China. There is hope, consider Germany’s new Northvolt factory, proving that this global industry is far from settled, and that Europe may just be in a position to leapfrog Beijing without too over protectionism.

While heat pumps, often produced in Asia, are far from popular with policymakers, their producers have already begun turning Eastern Europe into a manufacturing hotspot for the new wave of heating appliances.

And that leaves wind. Developments in recent months suggest that EU countries – most of all Germany and Denmark – are aware of this.

While the solar industry has made desperate pleas for support, the wind industry has received a dedicated wind power package and a charter where the EU-26, bar Hungary, committed to putting the package into effect.

No other clean-tech sector has received similar levels of support, and there’s more to come: The European Commission is currently deliberating whether it will entirely exclude foreign wind turbines from European markets.

Ultimately, it may indeed be the wind industry that will walk away with the largest share of taxpayer support on offer due to the protectionist reflexes of national capitals – and Ursula von der Leyen.

Source: Euractiv.com

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Spain’s decision to recognise Palestine as an independent state is not rewarding terrorism, Israel’s claims otherwise are “nonsense”, according to Foreign Minister José Manuel Albares in an interview on Tuesday (26 March)

In November, during a joint trip with Belgian Prime Minister Alexander de Croo to Israel and the Rafah border checkpoint with Egypt, Sanchez first mentioned the possibility of recognising Palestine unilaterally if the EU does not do so.

Then, in early March, Sanchez announced he would push Congress to recognise Palestine before the end of his mandate in 2027.

This sparked anger from Israel, with Foreign Ministry spokesperson Lior Haiat stating it “sends a message to Hamas and other Palestinian terrorist organisations that murderous terrorist attacks against Israelis will be reciprocated with political gestures towards the Palestinians.”

Albares rebuked the statement in an interview with private radio station Cadena SER.

“It is nonsense (…) to think that to support the creation of a Palestinian state is to reward terrorism,” Albares said.

He argued that the Palestinian people “have a right to a land and a hope”, which is that of a Palestinian state encompassing the Gaza Strip and the West Bank, and this “is not incompatible with (the existence of) the state of Israel.”

“The hope of the Palestinian people and the security of Israel are closely intertwined”, he added.

The pledge to recognise Palestine was also included in the electoral pact signed in October 2023 between Sanchez’s PSOE party and the junior coalition partner, left-wing platform Sumar, led by the Vice President of the progressive executive and Labour Minister, Yolanda Díaz.

The recent spat follows a recent joint letter from Spain, Ireland, Malta and Slovenia in which they expressed their readiness to recognise the state of Palestine as the “only way to achieve peace and security” in the region.

“We discussed together our readiness to recognise Palestine and said that we would do so when it can make a positive contribution and the circumstances are right,” the four wrote in a joint statement after an EU summit in Brussels.

Source: Euractiv.com

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EU countries endorsed a proposal to ease the environmental requirements of the bloc’s Common Agricultural Policy (CAP) for the 2023-2027 period, reaching a quick deal on the sidelines of Tuesday’s (26 March) EU Agriculture and Fisheries Council.

The draft text sailed through the EU Council with only minor adjustments made to the original version presented by the European Commission on 15 March. EU diplomatic sources told Euractiv that all national delegations backed the text in today’s informal vote and only Germany abstained.

Although these measures aim to appease the recent wave of protests by the agricultural sector across Europe, farmers staged further demonstrations in Brussels’s EU quarter on Tuesday, coinciding with the ministerial meeting.

 

“We have listened to our farmers and we have taken swift action to address their concerns at a time when they are confronted with numerous challenges,” said David Clarinval, Belgium’s agriculture minister and current chair of the AGRIFISH Council.

“The targeted revision of the rules strikes the right balance between ensuring greater flexibility for farmers and member states and easing the administrative burden, while also maintaining a high level of environmental ambition in the common agricultural policy,” he added.

The proposal supported by the Council maintains the changes proposed by the Commission on six of the nine Good Agricultural and Environmental Conditions (GAECs) standards on which CAP payments hinge upon, giving member states more flexibility to implement the policy.

These amendments, which include exemptions on compulsory soil covers, crop rotation, and fallow land rules, can be applied as of 2024.

Additionally, according to the draft legislation, farms of under 10 hectares, which account for 65% of CAP beneficiaries, will not have to comply with environmental checks and penalties.

In a letter sent to European Commission President Ursula von der Leyen on Monday (25 March), environmental NGOs and consumer organisations called for a withdrawal of the proposal, arguing that it “completely disregards” the democratic principles of EU decision-making.

“The European Commission has given in to the fake narrative that opposes the environment to agriculture,” the letter said. “The measures proposed will only undermine the very jobs that the CAP is meant to support in the long term,” it further stated.

The 16-organisation coalition, which includes NGOs WWF, BirdLife International, the European Environmental Bureau, environmental law charity Client Earth, and consumers organisation BEUC, slammed the Commission for scrapping the CAP’s environmental requirements without a prior impact assessment and only consulting with four farming organisations.

While the Commission argued that it did not conduct an impact assessment because of the “political urgency” of the measures aimed at addressing “a crisis situation in EU agriculture,” the organisations noted the absence of evidence supporting such urgency.

“The legislative proposal does not constitute a simplification of environmental requirements, it is backtracking,” the letter added.

The European Parliament, which used an urgent procedure to fast-track the legislative process, is expected to formally approve the proposal during its final plenary session on 22-25 April before the institutions enter a lame-duck period leading up to June’s EU elections.

Then, the Council will formally adopt the regulation, which could come into force by June 2024.

Source: Euractiv.com

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The Greek centre-right government (EPP) will face on Tuesday a no-confidence vote pushed forward by opposition parties following a press report suggesting that the conversations between train workers on the night of an accident that killed 57 people were distorted.

The no-confidence vote initiative was taken by the opposition Pan-Hellenic Socialist Party (Pasok) and was backed by other opposition parties.

The main opposition Syriza leader (EU Left), Stefanos Kasselakis, took a step further, calling on Greek Prime Minister Kyriakos Mitsotakis to resign and call snap elections with the presence of “international observers”.

Although the government has a strong majority and will likely survive the vote, analysts estimate that the three-day discussion that will follow will put many government officials to the test, as they will need to provide answers on the accident.

One year ago, an intercity passenger train travelling from Athens to the northern city of Thessaloniki collided at high speed with a cargo train outside the city of Larissa in central Greece, killing 57 people, mainly young students.

Since then, the progress of the investigation has been slow, with opposition parties and the victims’ relatives suggesting that the government is trying to cover it up.

Meanwhile, the victims’ relatives have collected more than 1.3 million signatures for a petition to the European Parliament, which was recently submitted.

The petition calls on the EU to step in and investigate the accident and hold politicians – who are protected by immunity – accountable for criminal actions.

The EU lawmakers from all political groups in the European Parliament backed the petition, suggesting that the EU institutions should closely follow the investigation’s progress.

The government insists that there is no criminal responsibility, only political responsibility for ministers, claiming that those involved resigned back then.

But To Vima journal revealed new evidence on the accident causing a political earthquake in Athens over the weekend.

Notably, the press report suggested that the conversations between train workers at the night of the accident – that were made public right after the accident – were “distorted” to enhance the argument of the “human error”.

The government refuted the report branding it as “fake news” but has so far failed to provide specific answers on had access to the audio files of the train workers’ conversations.

Some government officials also attacked the AlterEgoMedia group – where the journal belongs – referring to “organised economic interests”, causing the media group’s angry reaction.

“The media of AlterEgoMedia will continue with persistence, patience, and professional competence to operate in a purely ethical context, against the government practices that have led the country to 107th place worldwide in terms of freedom of the press”, the group said in a statement.

AlterEgoMedia was the only media group that refused to accept state funds provided by the government during the pandemic.

EU prosecutor also under fire

Several analysts have said the accident could have been avoided if a 2014 contract for the reconstruction and upgrade of the signalling system and the remote control of the Athens-Thessaloniki-Promachona railway had been implemented.

The so-called “717 contract” has been scrutinized by EU Chief Prosecutor Laura Kövesi, who recently said the Greek authorities are posing obstacles in her investigation.

“We are blocked from finding the truth and applying justice. Because if you are forbidden from doing the investigations, you cannot find out the truth”, Kövesi said.

Her statements triggered the reaction of Health Minister Adonis Georgiadis who described her intervention as “unacceptable” and going beyond the limit of her institutional role.

“If there is a procedure, even to question her post, we should do it”, he said.

Source: Euractiv.com

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Welcome to the latest Transport Brief!

Europe’s new suite of green rules for road transport is starting to take shape. Some new laws unambiguously push European carmakers to produce zero-emission vehicles. But other proposals are much less clear.

Take the new weights and dimensions rules. The Parliament’s proposed revision will allow fossil-fuelled trucks heavier than 40 tonnes to cross country borders until 2035.

Or the revision of the rules on tailpipe emissions. The parliament declined to meaningfully increase standards for passenger cars.

And who could forget the last-minute reprieve for the internal combustion engine?

On the other hand, the EU has sent its car manufacturers some pretty strong signals that the future of road transport is zero carbon.

Notwithstanding the debate over e-fuels, EU law now requires that cars and vans sold from 2035 must have zero emissions. Europe’s landmark carbon cap-and-trade system will cover road transport from 2027. And updated Euro 7 standards will cover emissions from brakes and tyres – the main emissions expected from electric vehicles.

The key question is: Do these mixed signals really help Europe’s carmakers?

The future of road transport seems almost certain to be electric. New international competitors in China and the US have wholeheartedly embraced this transition a long time ago.

European manufacturers, wedded to their highly developed combustion engines, were far more reluctant. As a result, there is now no guarantee that Europe’s current leadership in car production will transfer through to the electric age.

Ultimately, European carmakers will only thrive if they can produce the best vehicles.

The sector has already struggled with conflicting urges. Manufacturers’ need to defend past strengths has undermined their willingness to fully pivot to tomorrow’s challenges. It seems that these contradicting commercial interests are now being translated into EU policy – no doubt a result of industry lobbying.

But perhaps Europe’s carmakers would benefit from a clear, unambiguous signal – that from here on in, excellence in deep decarbonisation will be the ultimate driver of commercial success.

Source: Euractiv.com

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Ofgem has initiated an investigation into wind farm owners over alleged market manipulation.

They are accused of overcharging consumers by £100 million, with claims suggesting they artificially inflated compensation payments received for shutting down turbines on windy days when grid capacity wasn’t needed.

Analysts at the Renewable Energy Foundation (REF) provided evidence to Ofgem, indicating that wind farm companies might be inflating the price of “virtual energy” they never actually generated.

Ofgem has confirmed receiving the claims and commenced an investigation to determine if any rules were breached.

John Constable, director of REF, highlighted the potential impact on consumers, estimating the added cost to be £100 million in 2023 alone.

Mr Constable said: “Our evidence suggests that multiple wind farm operators have been charging over the odds to reduce their output on windy days, generating no energy but costing consumers a fortune.”

REF alleges that wind farm operators overcharged for constraint payments, which are payments given to generators for switching off assets when the national grid risks overload.

An Ofgem spokesperson told Energy Live News: “We do not agree with the Renewable Energy Foundation’s claim that wind farms can ‘name their price’ for turning down generation.

“We already have a robust set of rules in place which explicitly exist to prevent generators from abusing the energy market in such circumstances. We have required several generators to make multi-million-pound payments in the last year alone where those rules have been breached.

“Ofgem works with the Electricity System Operator (ESO) to look into alleged improper behaviour of wind farms and other generators.

“We’ll consider all the facts and if evidence of a breach of market rules is found we will not hesitate to act. We are also currently consulting on whether any changes are required to the licensing rules in this area.”

Source: Energylivenews.com

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The climate change-focused investment strategy known as ESG suffered another blow Tuesday at the hands of someone who was once its biggest steward on Wall Street: Larry Fink.

The BlackRock CEO called for “energy pragmatism” in his annual letter to investors. He said that consists of using clean energy to reduce global warming emissions while relying on fossil fuels for energy security.

The rhetoric from the chief executive of the world’s largest asset manager marked a significant departure from his years of staunch advocacy for ESG, or environmental, social and corporate governance investing that prioritizes climate change and social justice politics.

“Now, the demand for clean energy is being amplified by something else: a focus on energy security,” Mr. Fink wrote. “I’m hearing more leaders talk about decarbonization and energy security together under the joint banner of what you might call ‘energy pragmatism.’”

The messaging shift on a contentious issue that conservatives assail as “woke capitalism” comes after years of blowback from Republican officials against BlackRock and some of the globe’s other largest financial institutions, including State Street, Wells Fargo, JPMorgan, Bank of America and Vanguard.

Amid heightened political tensions, Mr. Fink said last year he was ditching the ESG term — but not its strategy — because it’s “been misused by the far left and the far right.”

In his 2023 letter to investors, he walked a fine line on the hot-button issue by saying it was not the role of private companies “to be the environmental police” but that BlackRock still considered “climate risk as an investment risk.”

Mr. Fink’s message to investors on Tuesday made clear that BlackRock has no intention of divesting from fossil fuels anytime soon and emphasized that oil and natural gas will be crucial for the Western world to maintain energy security in the face of foreign adversaries like Russia.

“I spent a lot of time talking to the people who are responsible for powering homes and businesses, everybody from prime ministers to energy grid operators,” he said, recounting recent meetings with world leaders in Europe. “The message I heard was completely opposite to what you often hear from activists on the far left and right, who say that countries have to choose between renewables and oil and gas. These leaders believe that the world still needs both. They were far more pragmatic about energy than dogmatic.”

BlackRock currently holds more than $300 billion in fossil fuel companies on behalf of clients, $170 billion of which are U.S. energy firms, according to Mr. Fink.

To climate activists, BlackRock is fueling climate change. To conservatives, it’s destroying the oil and natural gas industries.

Mr. Fink said their position is ultimately only about money.

“We invest in these energy companies for one simple reason: It’s our clients’ money,” he said. “That’s part of being an asset manager. We follow our clients’ mandates.”

Source: Washingtontimes.com

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Several European countries will hold elections this year, with economic conditions and the Russia-Ukraine war dominating discussions. Slovakia, Lithuania and Romania will elect presidents; Lithuania and Romania will also elect parliaments, as will Belgium, Croatia and Austria. Additionally, EU voters will choose a new European Parliament. These elections will highlight Europe’s political fragmentation and pose challenges to governance.

The EU’s economic growth was stagnant at the end of last year. France, Italy and Germany, the bloc’s largest economies, experienced minimal to negative growth. Gross fixed capital formation, government spending and household consumption slightly boosted growth, with gains ranging only from 0.1 to 0.2 percent over the previous quarter. Although the regional economy may be stable this year, expectations of a rebound are low, and many governments would be content just to dodge recessions.

Source: Geopoliticalfutures.com

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