The European Union has launched a Green Team Europe Initiative in partnership with the Association of Southeast Asian Nations (ASEAN)/South East Asia. This initiative is expected to strengthen the EU partnership with the region in the areas of climate action, environmental and biodiversity protection, and clean energy transition. The initiative provides the framework for coordinated green action between participating Team Europe partners (Austria, Denmark, France, Germany, Romania, and the European Investment Bank) and ASEAN and its member states, seeking synergies between their respective political frameworks: in particular the European Green Deal and the ASEAN Community Vision 2025. In addition, the European Commission (EC) has decided to prolong the State aid Temporary Framework until June 30, 2022.
EC also introduced a number of targeted adjustments, including two new tools to support the ongoing recovery of the European economy in a sustainable way:
- Investment support measures to help member states address the investment gap left behind by the crisis. Member states may create incentives for investments undertaken by companies and use this tool to accelerate the green and digital transitions. The measure includes safeguards to avoid undue distortions to competition, such as the fact that they should target a wide group of beneficiaries and the aid amounts should be limited in size. This instrument is available to member states until December 31, 2022
- Solvency support measures to leverage private funds and make them available for investments in small and medium-sized enterprises (SMEs), including start-ups, and small midcaps. Member states may grant guarantees to private intermediaries, creating incentives to invest in these types of companies and provide them with easier access to such equity financing that is often difficult for them to attract individually. This instrument is available to member states until December 31, 2023.
In another development, EC adopted a communication on a competition policy fit for new challenges, which frames the important role of competition policy for Europe's path toward recovery, the green and digital transitions, and a resilient single market. The communication highlights the in-built ability of competition policy to adapt to new market circumstances, policy priorities, and customer needs. Additionally, the European Council approved the 2020 climate finance figure of EUR 23.39 billion. This figure was committed by the European Union and its 27 member states to support developing countries in reducing their greenhouse gas emissions and adapting to the impacts of climate change. In 2020, close to 50% of the funding for developing countries was dedicated to either climate adaptation or cross-cutting action and close to half of the total funding was committed in the form of grants. The EU and its member states are determined to continue scaling up their international climate finance toward the developed countries' collective goal of mobilizing USD 100 billion per year, applicable through to 2025. They have recently made concrete pledges to enhance their contributions in the coming years as part of a climate finance delivery plan, which was published in October 2021.
- Press Release on Green Team Europe Initiative
- Press Release on Extension of Temporary Framework
- Press Release on Competition Policy
- Communication on Competition Policy
- Press Release on Climate Finance Figure
Keywords: Europe, Asia Pacific, EU, Banking, COVID-19, Climate Change Risk, ESG, Green Team Initiative, State Aid Rules, State Aid Temporary Framework, Green Finance, ASEAN, EC, European Council
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