Priorities of the European Union: evidence from the Ambassador of the Czech Republic and the Minister for Europe - European Union Committee Contents


Examination of Witnesses (Questions 20-39)

Rt Hon Caroline Flint and Mr Ananda Guha

3 FEBRUARY 2009

  Q20  Lord Teverson: What I was suggesting was that by tying 30% up now with a new condition that has always been refused by those countries, are you not shutting the door when you are appearing to open it?

  Caroline Flint: Even though it has been shut in the past that does not mean it cannot be opened in the future. I think climate change has moved up the agenda. I think we have had some positive statements from the new president in America and also, I think importantly, it has been trying to get across the economic impact and cost of not doing anything. I am all for saving the planet—of course we all are—but actually the Stern reports clearly show that the costs of not acting now will get bigger and bigger down the road. That was very much part of our discussions, certainly where I had bilaterals in the lead up to December with my counterparts in the European Union. Within the European Union we had to configure into that some countries with particular problems and their energy supply and what have you, and I think we got a really good deal. I think it is a case of just keeping it alive along with, I have to say, more and more thinking about how technologies of the future can play into our jobs and opportunities and recovery: changing the way industry operates, changing the nature of jobs that currently exist and the training behind them but also thinking about the jobs that have not even been invented yet and what they might offer. I think there is a very plausible and real economic argument behind that and that is the sort of message we want to get across as well as saving the planet.

  Q21  Lord Trimble: Could you not simply say that the more ambitious target is not capable of achievement unless the BRIC countries are in there trying to achieve it too.

  Mr Guha: China is now the biggest emitter of carbon. If we want to have a viable carbon deal at Copenhagen we will need China to come on board and that was part of the discussions the prime minister had with the Chinese premier earlier this week. By setting the agenda at 20% we have set a benchmark which we are challenging others to come up with whether it be the US or the BRIC countries and this will be a tough negotiation but it is a negotiation which I think we have all agreed is one that will have to conclude and conclude soon.

  Q22  Lord Trimble: I would interpret the Council's conclusions in the same way as Lord Teverson in that the Council was saying that 30% is conditional on BRIC coming in.

  Mr Guha: It was a difficult deal to get to 20%. A number of other Member States, particularly the new Member States, would not have signed up to a 30% deal without some sort of quid pro quo from other major emitters.

  Q23  Lord Trimble: it is not just a matter of getting the other Member States on board; we need to get BRIC on board to have any hope achieving that 30%. Without BRIC you will never achieve 30%.

  Mr Guha: That is correct but essentially by giving the 20% benchmark we set a challenge and it is important that the EU as a whole did that to demonstrate quite good leadership.

  Q24  Lord Hannay of Chiswick: On the same points that have been covered in recent questions I welcome very much that the March European Council is going to make progress on these issues of technology transfer to developing countries and finance for them, but surely the heart of this negotiation in Copenhagen is actually going to be the articulation of the relative obligations being entered into by the developed countries and the developing countries. They will not be the same—that is what Bali says—but if they are so different as to be meaningless we will end up at Copenhagen with a deal which does not actually reverse climate change. Is it not time that the European Union started to firm up a negotiating position for the different obligations that ought to be entered into by the two groups of countries because that is going to be at the heart of the future negotiation? Certainly what the Chinese prime minister said to the Financial Times was not particularly encouraging. The present intention for March seems to be to deal with part of the problems of developing countries but not the key one which is the relative obligations.

  Mr Guha: I think we have already had a similar debate within the European Union whereas new Member States were arguing that they could reduce their carbon emissions massively from 1990. We had discussions on burden sharing and no doubt there will be a repeat of that when it comes to the wider international negotiations. I think it is a perfectly valid point.

  Q25  Lord Hannay of Chiswick: Yes, but I observed in the House last Thursday that we cannot afford many more victories like the one in December if we want to reverse climate change.

  Mr Guha: I am not sure I understand—

  Q26  Lord Hannay of Chiswick: December is claimed to have been a great success for the European Union and I would go along with that, but it was a very close run thing and quite a lot of water was poured into the wine in the process. If we have the same approach in the run up to Copenhagen we risk having an outcome at Copenhagen which looks good on paper but does not actually achieve the only thing we need to achieve which is to slow down and eventually to reverse climate change. That is the point I am making, which is why at the heart of this negotiation will be this issue of the relative obligations of developed and developing countries. It would help, Minister, also if you could assure us that you will not be going off down the road of threatening trade protective measures against anyone who does not do what we want in this negotiation which has been talked about from time to time and which is, I think, a very dangerous course.

  Caroline Flint: As I said earlier, I think part of addressing some of the aspects around the finance package is about being able to provide something to developing countries but also at the same time have some expectation about what they should deliver as well. I certainly noted what you said, Lord Hannay, and I will make sure that my colleagues in other departments who lead on this are made aware of the Committee's views. As I said, there is a meeting of ministers tomorrow who are most involved in this situation and they will be deciding the UK's strategy. I will make them aware of the Committee's views and your views in particular.

  Q27  Lord Kerr of Kinlochard: Thinking about Eastern Europe, the European Council liked the concept of the Eastern Partnership and I think there is going to be a summit meeting in May. The European Council wants to look again at the concept and has asked the Council to flesh it out. How is that work coming on? Can you describe the flesh that has been put on the bones? I admit that I do not really understand how detailed this new framework is to be. Can you tell us which are the areas where the Member States are divided about how much flesh to put on the bones, and what kind of flesh?

  Caroline Flint: I think there is a pretty successful conclusion to this. The discussions are developing and there have been a number of discussions at official level that have had wide support. We are now going through other working groups dealing with trade, justice and home affairs issues and the Presidency will meet eastern partners this month. There are some key issues outstanding, financing being one of them. How the eastern partnership will complement the Black Sea Synergy and also involvement of third countries as well. As I detail in my notes to Lord Roper they have identified some money—I think something like 600 million euros—and what I understand will happen now is that during the course of this year and next year they will be using that budget line, if you like, as a way to incentivise bids and ideas to come forward and money can be provided. I understand it can take up to two years from the ideas going, getting partners who can help in these different areas but also making sure that there is the capacity there. There will be a launch summit on 7 May. That will actually also be followed on 8 May with an energy summit with the eastern partnership invited to be part of that as well which seems to me a good idea because obviously these countries are very important to the issues around energy security and supply. Again I think the way the Czech Presidency has put that together is a welcome initiative.

  Q28  Lord Kerr of Kinlochard: The six countries are quite a disparate group; is there any qualification or hurdle they have to pass to become members of this club?

  Caroline Flint: In different ways, looking at the list of countries, yourself and others will be aware about different levels of engagement and work within the European Union. Some countries in the group have got some EU sanctions being applied to them in different ways. It will be interesting to see, particularly in the next few months, for example whether Belarus are able to take some actions in order to have a good report which I think is due in April. There are different levels of engagement and cooperation already in these countries, but I think what holds them together is their location and the geographic position and those particular aspects. They are different in different ways and there is not necessarily a one-size fits all in terms of EU's relationship with them or, for that matter, their relationship with the EU. Some are clearly ambitious about a much closer relationship and even to be part of the EU family; others are looking westwards in terms of potential opportunities for their country in the future.

  Q29  Baroness Howarth of Breckland: One of the issues that comes up quite often in this is the question of human rights in these countries. I am very interested in the agenda setting for the March and the May discussions because when we interviewed the Czech ambassador he was quite clear that the Czechs were not interested in the social issues that relate to the EU and I think we are aware that some of the directives relating to women's rights have been questioned in relation to their implementation in some of our EU partner countries, never mind those in the eastern partnership. How are those kinds of questions going to be raised at a time when economics and climate change crowd the agenda, and yet these are the issues that will affect individuals on the ground?

  Caroline Flint: I think they are ever present and one aspect of rule of law and the way in which countries tackle corruption is very important in terms of individual human rights but they are also about the backdrop to businesses wanting to work in those countries, particularly if they are going to have their own staff placed there over a period of time. It is one of the issues that many businesses say puts them off investing because of lack of confidence in the courts, the way in which social society is organised and the impact that can have particularly if there is a British company employing a local workforce as well. It is not about trade versus human rights; we believe the two absolutely have to go together. Governance, democracy and rule of law are absolutely key to that as well as the transparency within which these systems operate. We think that is important. What we believe is that the benefits that the closer collaboration with the EU can offer can incentivise, we hope, these countries to make some changes and I think we have some evidence of that with countries that have joined the EU—I am not talking just about the last round but going back even further—so that is something we will continue to work on. It does mean that it is something that the EU does but we also do in our bilateral relationships as well. Certainly in relation to Belarus I was very clear about this when I met them.

  Q30  Baroness Howarth of Breckland: While you say it is implicit, that is what the Czech ambassador was saying and we were saying it needs to be made explicit. I assume our government will make these issues explicit as well as implicit.

  Caroline Flint: I think we always do make it explicit and do not shirk the opportunity to do so.

  Q31  Lord Sewell: Coming back to climate change, I think there is every likelihood that whatever comes out of Copenhagen will be declared as a great agreement that has the potential to save the world. If it is going to save the world it needs to be implemented quickly. Would you like to say something about the framework to ensure implementation, that whatever comes out is actually delivered. Also would you say something about financial assistance to developing countries? I certainly detect within the Commission a growing concern that the developing countries themselves would prefer to see that financial assistance in terms of general development aid rather than specifically focussed policy assistance to enable them to reduce emissions. Finally, if you look at the BRIC countries in terms of human and physical assets at risk they are going to be the greatest beneficiaries of a successful attempt to control climate change, but the rhetoric is not particularly helpful. Certainly last year the Indian Government seemed to be somewhat detached from reality. Do you detect any change in rhetoric from the BRIC countries?

  Caroline Flint: Dealing with the first point, as I mentioned earlier the Commission has published a document in which it has outlined two mechanisms (without recommending one over the other) to provide new sources of finance. As I said, the relevant ministers here in the UK are meeting tomorrow when they will be looking at that document and thinking about what position we feel would be most useful to this. You will forgive me if I do not pre-empt their discussions tomorrow on that.

  Q32  Lord Sewell: Would you agree that implementation is vital.

  Caroline Flint: I absolutely agree with you and that is why getting the right package around incentivising these countries to be part of a package is very important. We are also looking at another aspect of the communication which recognises domestic cap and trade systems and an effective way for countries to reduce their greenhouse gas emissions. Again the EU could assist developing countries over time in adopting systems similar to this. Ananda, did you want to add something?

  Mr Guha: I was going to make a couple of points actually. Firstly, on the clean development mechanism those are very specifically projects that will benefit developing countries. China, where I was posted for three years, is the principle beneficiary of the clean development mechanism. Even while I was there between 2005 and 2008 as to the question you asked about whether we have seen a change in rhetoric, I think the answer is very firmly that we have. The Chinese have published their national climate change plan, for instance, and I think they recognise it and reports like the Stern Review—commissioned by the Chancellor as was—have been very influential in changing their thinking on it and that has to be a positive development ahead of Copenhagen.

  Q33  Lord Sewel: What about India?

  Mr Guha: In India there has been a very similar debate and I know the Stern team have been out there and have had very productive discussions.

  Q34  Lord Richard: Coming back to the eastern partnership concept because I share some of the concerns that Lord Kerr has expressed. I suppose the trick with these countries is how do we encourage better relations in the EU and this group of countries without upsetting the Russians too much. If you alarm the bear no doubt he would retaliate. There is a balance to be struck there. It seems to me that there is a danger that the EU is perhaps displaying too much enthusiasm for relations with eastern partnership countries and perhaps we should treat it more circumspectly and take it slowly and calmly. Do you share that view?

  Caroline Flint: I hope we are taking it calmly. As I said before, the relationships with these countries—the six in the eastern partnership—vary enormously I think in many respects in terms of the existing cooperation and agreements that we have with them. Some are very keen to have a journey towards membership of the EU; others are not in that situation. What I do think is important is where we have countries who wish to work more productively with the European Union that is up to them to decide. I do not think that should be seen as a threat to historical culture and other links with Russia. Many of these countries will continue, whatever their relationship with the EU, to have constructive relationships with Russia as a near neighbour and the interlinking of their existing trade with that country is likely to continue for the foreseeable future. Likewise, Russia's relationship with the EU is very important as well; Russia I think has benefited much from that relationship and should continue to do so. I think this is about the 21st century and living in a modern world where countries want to look at what is best for their citizens and part of that is about looking westwards towards the EU and I do not think that is a bad thing. Of course concerns have been expressed but I think we just need to deal with some of those concerns head on and say what this is about. This is about opportunities for our system to prosper from association but also for these countries as well. This is not about a threat to anyone. Some people might not read it like that but I think that is the case and we have to keep making that case, what it is about rather than what it is not about.

  Q35  Lord Hannay of Chiswick: Is it not the case that the excess of zeal really lies in Moscow, in the Russian Government which has an excessive amount of zeal for re-incorporating these countries in what they call a sphere of influence, which is something which would be against our interests and certainly against the interests of these countries. Are we making any progress at all in getting into a situation where the EU really does have a properly articulated and unified policy towards Russia or are we still living in a world in which, whenever the Russians want to, they can divide and rule?

  Caroline Flint: In terms of your first remark I do not believe there is a post-Soviet space that Russia has the right to dominate. Secondly, I think that in relation to the EU, as the Committee will be aware, it was agreed to re-start discussions with the Russians in terms of a partnership or cooperation agreement. That covers a multiple number of areas and what was very clear when the decision was made to re-start those discussions was that the tone and pace of them would be determined by Russia's engagement and involvement but also the outstanding issue of Georgia. We want to have, as they say, a rules based engagement with Russia and one in which we can work openly and productively and also one in which we have to set the pace of those against how Russia acts in a constructive way as well. As you will all be aware the Ukraine/Russia gas dispute I think focussed everybody's mind and attention about energy supply more than anything that had been written on paper before. I was in Prague for the Czech Presidency foreign ministers informal meeting and it dominated our day of discussions. Parallel to our discussions the Commissioner responsible for energy and the energy minister from the Czech Presidency were having meetings with both Russian representatives bilaterally and Ukrainian representatives. I think it would be fair to say that around the table people were very concerned about what had happened. Now I think equally people are concerned about Ukraine's involvement in this. It really drew into stark attention the need to look at the issue productively and speed up our approach to energy security and supply. That is why I think discussions later this year about the package around investment in these areas and looking at all the pipeline issues and interconnection issues has been very important.

  Q36  Lord Dykes: Sometimes it can be a question of personalities and in view of the two or three encouraging interviews you gave to the western TV media do you think there has been a significant psychological change with President Medvedev instead of President Putin?

  Caroline Flint: I would like to think that the international reactions to what happened in Georgia gave our Russian colleagues some pause for thought. I think the continuing relationship with the EU has been caveated by wanting to see a more positive engagement by Russia as well and we will continue to work with Russia. However, when we feel that Russia is not acting appropriately we will say so as well; whether it is the Georgia situation or the gas supply situation the EU showed it was ready to do so even though we have 27 Member States round the table who obviously have different types of relationships with Russia as well. I think it was a pretty good result.

  Q37  Lord Teverson: The Commission has proposed biennial summits of heads of state and government of EU Member States and the six eastern partner countries. How valuable do you think these summits will be in comparison to bilateral summits between the UK and individual countries? Is there going to be room for these in the diplomatic heads of government merry-go-round given the fact that we already have a Mediterranean Partnership, a Nordic Council and no doubt you could name many more than I could.

  Caroline Flint: I might come back on that answer after we have seen how they are working in practice. I think they offer value to individual bilateral summits. What is important about them is that where they take place they should be well prepared and the agenda should be something that has some outcome from it. To that end I think they are quite useful. They will be a demonstration of high level political support for these countries and working with them but I think the proof will be in terms of when they take place what actually happens and we will watch that with interest. I have some sympathy with your point of view about summit-itis and how packed the diary is. I say that, sharing my angst with you about the calls on my time to spend in various meetings. I do not mind meetings as long as they are meetings with a purpose and we get some added value out of them. I think they are helpful and if we can see how our bilateral summits feed into them and help complement them and create momentum they will be great but we need to see them working in practice and see if they are working well or if they need to be thought through again.

  Q38  Lord Richard: Can I come back again to the Ukraine? How reliable a partner do you think the Ukraine will make for the UK? Indeed, how reliable a partner would they make for the EU given the gas dispute troubles and the economic troubles? How should we approach them?

  Caroline Flint: I visited the Ukraine not so long ago; I went down to the Crimea and got a flavour for the different parts of the country. It is clear to me from that visit that Ukraine really does want to be part of the European Union and among its public it is very popular. They want to be a reliable partner; I think they do want to become a normal European country but it is not easy. I think it is part of our role to see how we can assist them to attain that goal. We are working in different ways with them. I think the energy situation in one sense shows how much work needs to happen in the Ukraine as well. As a constructive friend of Ukraine it is important to say that the actions that happened did cause a lot of disquiet amongst EU partners, equally so Russia as well. Again I think they have to demonstrate this year following previous EU reports about the country how they are going to get down track and part of that I think is about political unity in the country to deal with some of the areas that it has to deal with to be shown to be making a difference. There is a lot of support for Ukraine and I think within Ukraine there is definitely the will. It is making that happen that I think is going to be key. As I said, I am glad the initial situation was resolved. If it is resolved to an extent as well in terms of the issues about the gas prices and what Ukraine pays and so on and it does not lead to a repeat of the situation next year then I think that will be good. One of many things that have come out of this dispute is trying to get a contract onto a better basis, the sort of commercial basis that needs to exist for a country like Ukraine to become part of the way in which we do contracts and facilitate contracts as EU Member States.

  Q39  Lord Teverson: Minister, did we really have all the same machinations back in 2006 when this happened then? It obviously has not been a complete failure as proven by the fact that we have the same problem this year.

  Caroline Flint: You are right, that is why I said that I hope this time next year we actually do not have a recurrence of what has happened. The way this cycle has developed has been very worrying but I think what has made a difference in terms of previous occasions is how this crisis really galvanised the EU Member States and the Commission to think about what role we needed to play to deal with this. I think it is quite difficult for the European Union because obviously it is a commercial contract and it is not really the role of the European Union to act as an intermediary broker. We may want to play that role in this situation but we do not want it to lead to precedent to other situations. However, I think where the EU did show some leadership was to recognise that there were political aspects to this that they could act as a broker on but also that within limitations to get parties talking to each other and finding a commercial solution. The other side of it is the way in which it has galvanised EU Member States to think about energy policy and step up their determination to look at some of these issues around renewables but also energy pipelines which again will develop more during the course of this year and energy ministers meet and talk about getting some of the ideas and pilots under way and within that the relationships with countries that are going to be party to those sorts of developments. I hope we are not going to be in the same situation of a repetition of this and I think the actions the EU took this time were correct and pretty helpful to making sure it does not happen again. I do not want to be complacent; we have to work hard at this.



 
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