The Trillion Euro Bluff

The “European Green Deal” will be expensive, very expensive. One trillion euros by 2030, says Commission President von der Leyen. But her investment plan for a better climate contains a lot of hot air.

According to the Commission, 485 billion euros are to come from the EU budget. However, the financing of this enormous sum is not secured, as the EU states are still negotiating the financial framework for the years 2021 to 2027.

The European Investment Bank in Luxembourg is to lend another 300 billion euros. But the equity capital is too low, criticises green financial expert Sven Giegold. The German government rejects any increase, though.

The member states are to contribute around 115 billion euros through co-financing. But no commitments have been made yet. Some states, such as Poland, are demanding that they not pay, but rather collect aid in Brussels.

The financing of the “Just Transition Fund”, which is intended to compensate Poland and others for the coal phase-out, is also quite windy. 100 billion euros have been announced for this – but only 7.5 billion euros are coming as “fresh money” from the EU budget.

Von der Leyen wants to raise the rest through financial leverage and private investment. But this has already worked insufficiently with the Juncker Plan – the last EU investment programme – as CSU financial expert Markus Ferber warns.

Overall, the “green” investment plan is built on sand. Instead of a solid financing concept, one must probably speak of a bluff. Von der Leyen would have been better advised to openly admit that she does not have enough money.

That way – and only that way – she could have put pressure on Chancellor Merkel not to be so stingy. For Merkel is likely to have the last word when the new EU budget is negotiated this summer – under the German EU presidency…

Translated with (free version) The original post (auf deutsch) is here