The set of trade-related instruments the EU is putting in place including FTAs with Energy and Raw Materials chapters, have the sole objective to reduce the supply risk of raw materials for the EU, by preventing export restrictions, potential export taxes, or export quotas or export prohibitions imposed by a third country. Rules that are unlikely to help resource-rich countries in the global South to break their dependency path. In fact, they will deepen extractives production, based on the exploitation of raw materials, to maintain high demand in the EU member states – even more so, as the EU policymakers do not seem to have considered structural debates about which economic sectors to prioritise and which to phase out in this transition process. This again will put more pressure on resource-rich countries, their ecosystems and water resources while fuelling social conflict.
Therefore, a ‘just ecological transition’ needs to be based on rethinking the economy in its entirety, as the control and extraction of natural resources are currently driven and determined by the profit motive, whereas for a globally just transition the need for raw materials and other essential resources like water need to be scaled down, waste reduced and the focus placed on re-using and recycling, building technology that is long lasting, and away from ‘for-profit’ to ‘for the common good’.
The logic of the CRMA, however, is to diversify the range of suppliers without changing the underlying trade and economic model and its structures. While the EU and other highly industrialised countries advance in ‘greening’ their economies through special fiscal incentives, de-risking strategies and other financial and international trade instruments to facilitate market access and a ‘safe investment environment’ for their corporations, countries in the global South are left with very little policy space and financial means to move up the cleantech supply chain. Even if the narrative of the EU is currently set to understand strategic bilateral partnerships as “mutually beneficial” to increase the “local value addition”, the EU is looking to secure access to the raw materials by signing free trade agreements and making sure the value addition (smelting and processing) of the material happens in the EU. If the ‘green transition’ moves ahead as the EU and the other major economic powers, such as China and the USA, foresee, the only option for resource-rich countries in the global South will be to deepen the massive exploitation of metals and minerals with all the associated social, economic, and environmental impacts.
The term green colonialism is increasingly used to describe this situation, namely the extension of colonial relations of plunder and dispossession to the green era of renewable energies, with the accompanying displacement of socio-environmental costs to the global South countries and communities. The economist Michael Roberts, among others, argues for using the term imperialism rather than colonialism, since it is not only the former colonial powers using these practices, but also China, which is increasingly investing in the global South countries for the extraction of CRM. Roberts explains: ‘Colonialism was the direct extraction of resources and labor (slavery) through political and military occupation and control. That is generally over. But, in many ways, the exploitation of labor in the periphery is even larger and more destructive than in the colonial era. Now, the transfer of value from poor countries to the imperialist bloc is through so-called free trade and free flows of capital and credit’.
At the same time, countries in the global South are not passive by-standers in this process. They are increasingly taking back control over their natural resources by passing laws and regulations to ensure that they retain the processing, marketing and selling of raw materials. The EU’s pressure to sign new FTAs including ERM chapters can also be viewed as a direct answer to these endeavours. While the EU formally argues that the trade partners have the sovereign right to regulate in order to achieve legitimate policy objectives, the rules included in the ERM chapters are unilateral, corporate-captured, and push for lower standards in relation to trade and investment in the raw materials and energy sector. ‘Win–win partnerships’ may look very different from the perspectives of the resource-rich countries in the global South.
Nevertheless, the EU will continue to promote FTAs as part of its transition from an energy based on fossil fuels to a ‘cleantech’ economy. While it is obvious that the dependence on fossil fuels must change if humanity is to stand a chance of survival, it is equally urgent to discuss who benefits and who is affected by this process. Current EU trade rules and policies give the wrong answer: they are biased instruments, designed to serve European interests while externalising the social and environmental costs of an economic model based on extractivism to the resource-rich countries in the global South. Despite the EU ́s assurance that the green transition must be undertaken in such a way as to ‘leave no one behind’, the FTAs it promotes will effectively do that: exclude the majority from democratically deciding how to create social benefits from their countries’ mineral wealth. It will not be possible to achieve a green and just global transition with these trade agreements. From what can be gleaned from the experience with the other proposed trade-related instruments that are only now starting to be implemented, such as SPs and Global Gateway, they appear to be heading in the same direction. There is a need for more research on the interdependent nature of these instruments and their impacts on the ground, along with a closer look at the specific drivers of the EU ́s green transition.
The report shows that the EU trade policies continue to favour an expansive economic and consumption logic while deepening the North–South divide, recklessly relying on technological and scientific advancements and anticipated returns from renewable energies. It also highlights the alliances with large corporate enterprises (for instance the Global Gateway and strategic projects), deeply committed to their own interests and entirely disconnected from and unaccountable to people’s well-being or the planetary boundaries. Indeed, this complex issue requires broad alliances to make concrete proposals on how to imagine a just and sustainable transition. This report has aimed to expose the role of international trade and how the EU is introducing new building blocks to continue propping up old structures.
