#LessDebtMoreEarth: a green economic take-off for Greece and the EU

EPA/SIMELA PANTZARTZI

Protesters hold placards written in the Greek, German and English language during a demonstration in front of the Greek Labour Ministry in Athens, Greece, 04 July 2016.

#LessDebtMoreEarth: a green economic take-off for Greece and the EU


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Greece’s economy needs to breathe and Europe needs a groundbreaking economic take-off. Yet, the European Union is heavily troubled by deep political divisions, recurring economic woes, xenophobia, nationalism, unemployment, while Greece suffocates submerged under the waves of an endless economic storm.

Notwithstanding Europe’s crisis, the world moves on to face colossal challenges, such as climate change, biodiversity loss, social and economic inequalities. 2015 was a landmark year, as the international community agreed on two global survival plans: the Paris Agreement on climate change and the UN’s Sustainable Development Goals (SDGs). In a world of increasingly interconnected economies and no environmental boundaries, the solutions to global challenges on the way towards ecological and social sustainability need to be global as well.

At WWF, we are deeply concerned about the dismal reality of Greece’s debt overhang. This situation undermines the future of the country’s environmental outlook and social wellbeing, while dragging the entire EU into a prolonged crisis. This concern has led us to think out of the ‘box’ in looking for possible solutions: on November 2nd, WWF published a discussion paper on proposing debt relief for Greece, in the context of a sustainability agreement based on the globally adopted platform of the UN’s SDGs.  Covering almost all areas of development, including good governance, poverty, education, industry, climate change and nature conservation, the 17 SDGs and 169 specific targets are the bailout agreement for humanity on earth.

Τhe basis of such an agreement could cover a coherent set of measures for a) nature conservation and environmental protection, b) living economy, and c) public revenue enhancement, while combating environmental crime and promoting environmental excellence.

Admittedly, Greece has never been a champion of green policies. However, the loss of valuable legislation and policies that constituted basic environmental acquis has been alarming since the onset of the crisis. Unfortunately, as we have consistently shown through our CrisisWatch website, a rollback on environmental laws and policies seems also to be an emerging trend at the European Commission level too.

Now is the time for bold action that will guide the EU’s way out of the economic crisis. Starting with Greece’s debt crisis, one of the most serious European headaches, it’s high time for relief. A meaningful agreement on debt reduction would need to significantly reduce Greece’s debt stockpile with measures that would include substantial haircut, and be based on specific conditionality, which would enhance the EU’s contribution to the UN’s Sustainable Development Goals, while at the same time secure the future of Europe’s natural wealth found in Greece.

WWF’s proposal does not seek to reinvent any wheel: partial or full debt relief has been approved for many highly indebted states, albeit developing. However the effectiveness of most of these initiatives has been heavily criticised, primarily due to their heavy conditionality and austerity measures, as well as their disregard for their environmental impacts, which limit their contribution to sustainable economies and poverty alleviation. Greece though is a case on its own: a member of the EU family and a developed economy, while also one of the ecologically richest European states, Greece can become a paradigm for the transformation of high public debt into a force for the achievement of high sustainability goals.

One may legitimately ask why creditors would forgive excessive debt. The answer is simple: because excessive debt is money that will hardly ever be returned, while its burden on economy, society and environment will remain very high. Linking meaningful debt relief with measures that stimulate a living economy can strengthen the country’s midterm payback ability, while also setting the foundations for long term sustainability and improved servicing of the remaining debt stock.

In these difficult times, the European Union needs more Europe and more Union. The financial crisis has been dragging the entire EU into uncertainty for too long. The environment as a common asset whose good status requires concerted EU action, can offer a platform for joint initiatives that shape a coherent vision of Europe uniting in pursuit of the common good.

 

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