The European Green Deal must be at the heart of the COVID-19 recovery

Business and industry leaders are joining forces to make the coronavirus recovery a chance for a re-set to build a sustainable, inclusive economy, revitalizing industry, preserving vital biodiversity systems and increasing economic growth in Europe.

This was to be a critical year for tackling climate change. It is the year that countries are to submit their new or revised national climate action plans, a key step towards realizing the Paris Agreement. And it also starts a decade in which the world must cut emissions by over 45% if global warming is to be limited to 1.5 degrees Celsius.

Then came the coronavirus crisis, leaving governments and businesses scrambling to save livelihoods, companies and jobs. However, a growing number of business and industry leaders are now calling for the European Green Deal to be used as a framework for tackling short-term economic needs with long-term sustainability goals.

The initiative comes as a new forecast by climate experts at the Global Carbon Project predicts that carbon dioxide emissions could fall by the largest amount since the Second World War due to the impact of COVID-19 on economic activity. This means carbon output could fall by more than 5% year-on-year, which is the first dip since a 1.4% reduction following the 2008 financial crisis.

However, as economic activity resumes and countries and companies develop recovery strategies, we need to fast-track the structural changes towards a fossil-free economy. The European Green Deal could be the opportunity to leap-frog in this ambition.

The European Green Deal, launched by the European Commission in December 2019, outlines a comprehensive framework of regulations and legislation aimed at achieving the EU´s targets of net-zero carbon emissions by 2050, and a 50% to 55% cut in emissions from 1990 levels by 2030.

Achieving this transformative agenda and making Europe a leader in the global climate transition requires a massive mobilization of public and private investments. The Commission estimates that reaching the net-zero 2050 target requires at least €1 trillion of public and private investment over the next decade.

As European governments and institutions are responding to the coronavirus crisis with the largest stimulus packages since the Great Depression, there is a real opportunity to deploy this stimulus strategically to fast-track a fossil-free and competitive economy for Europe. Germany has agreed a package worth up to € 750 billion ($ 808 billion) to mitigate the damage of the virus, and in Spain and Italy the size of the stimulus packages are estimated to be 7.3% and 5.7% of GDP respectively.

Ultimately, these massive European support measures will shape Europe´s economies and societies for decades to come – we should make sure it leads to a greener, more resilient and inclusive future. It is also increasingly clear that no government or business can handle this alone – strong partnerships and deepened cooperation with the business sector is critical if Europe is to succeed.

Business plays a critical role in accelerating investments and action to realize this ambitious plan. It is why the World Economic Forum has created the CEO Action Group for the European Green Deal as a vehicle for policy-makers and institutions to collaborate with representatives from governments, industry and the business sector.

Read more about the World Economic Forum´s work in supporting business role for a green recovery.