Sustainable development in Germany: the political dimension

“The ecological problems caused by human economic activity are worsening and taking on global dimensions. ..If we are to move toward sustainable development, the industrialized countries will have to accept special responsibility... The key is to sever the traditional link between economic growth and the consumption of resources.”

These are not the words of an environmental campaigner or pressure group, but taken from an article in the journal Science, written in 1998 by the then German Environment Minster, now Federal Chancellor Angela Merkel.

A scientist by training, Merkel developed quite a reputation in the late 90s for banging other politicians’ heads together to address the growing threat of climate change. Her efforts were instrumental in getting leaders to sign the so-called Berlin Mandate in 1995, a precursor of the Kyoto Protocol. In the view of Eileen Claussen, President of the Pew Centre on Global Climate Change, "Kyoto would not have happened without her."

In the past couple of years as well, Merkel has shown a willingness to rattle the cages of her fellow leaders on climate change. Speaking to a joint session of the US Congress in November 2009 she urged the need for agreement that “global warming must not exceed two degrees”, an aim for which was “the readiness of all countries to accept internationally binding obligations" was essential.

She is also credited with arguing the case with Presidents Bush and Hu Jintao, to set verifiable targets for the reduction of greenhouse gases. Such a preparedness to champion the environmental cause led Time magazine to hail Merkel as a ‘Heroine of the Environment’ in 2007, and even The Guardian – not an organ given to praising right-of-centre leaders – declared her in early 2008 as one of the “50 people who could save the planet.”

Does this mean therefore that return of Merkel to the Federal Chancellery last Autumn can be seen as a triumph for the environment? Unfortunately not.

Like democratic politics the world over, last year’s parliamentary elections had infinitely more to do with economics, the recession and the credit crunch than it had to do with the environment.

The global economic downturn has had significant effects on Germany. As a major exporter, German industry has been hit by much reduced demand for its goods, and the horse-trading over the future of car-maker Opel further demonstrates the vulnerability of the German economy. These developments, together the economic stimulus package announced early last year, and tax cuts introduced after the election are expected to bring Germany’s budget deficit to 6% of GDP this year, twice the EU ceiling.

In addition to these immediate problems, Germany has structural problems to address. The pension system, for example, is becoming increasingly unaffordable in a country that has one of the lowest birth rates in the world.

For most Germans therefore, fixing the German economy is more important than saving the global environment. Merkel’s victory therefore says much more how her unassuming style gives people the confidence that she was the one to fix the economy, rather than about her environmental credentials. Her choice to enter into a coalition with the pro-business Free Democrats demonstrates that the new government sees its focus as being to get German industry back up and running.

However, it is still the case that environmental factors remain much closer to the core of political debate in Germany than they do in many other countries. Although no longer in power at a Federal level (they formed a coalition with the Social Democrats from 1998 to 2005), the Green Party made a good showing in September, winning 68 seats in Parliament. They are also part of the governing coalitions in 3 of Germany’s 16 Laender.

Germany was also one of the first countries to take climate change seriously, launching the Enquete Commission on Preventive Measures to Protect the Atmosphere in 1987. The German Emissions Trading Group—composed of a representatives from federal and state governments, parliament, industry, and environmental groups—was established in October 2000, and in 2006 and 2007, a series of ‘Energy Summits’ were held to bring together important parties in the debate surrounding the intersection of energy policy and climate change.

For businesses operating in Germany therefore, environmental policy remains a key operating factor. Indeed, the German employers federation, the BDI condemned the failure of the Copenhagen summit – the organisation’s Director-General Werner Schnappauf commented that “we are sobered and disappointed by the outcome of the UN climate conference.”

Nonetheless, Schnappauf’s further comments reflect the tension facing German industry – “there is still an acute danger that emissions and jobs will be shifted to countries with lower climate protection burdens.” Here then is the dilemma for German business. In the longer term, it will be well placed to deal with the higher environmental standards that will eventually have to be introduced. However, in the short term, it risks being undermined by manufacturers operating to less stringent criteria.