From ambition to action: The EU needs stronger partnerships to reach its 2040 climate target  

Problem

On July 2nd, the European Commission proposed a new 2040 target: a 90% net reduction in the European Union’s greenhouse gas emissions from 1990 levels. However, only 7% of global emissions are from the bloc. To really limit the impacts of climate change—such as the current heatwave sweeping the continent—the EU must cooperate with other parts of the world.

However, the lack of trust between rich and poorer countries is complicating international climate negotiations—including the next UN climate change conference, COP30, in November. At the same time, many emerging and developing countries lack sufficient technology to move forward rapidly enough. Europe, on the other hand, is largely dependent on imports of critical raw materials and other key technologies from China for transitioning to a low-carbon economy. Without diversifying its supply chain, this puts the bloc’s green agenda in a vulnerable geoeconomic position.

Solution

To facilitate global climate action and protect its own, the EU needs to strengthen its partnerships with other parts of the world. It can do this by making partner countries four key offers.

First, the EU’s next multiannual financial framework should include specific money to support co-innovation and green technology transfer with partner countries. This would help finance joint research initiatives, strengthening local green innovation and diversifying the EU’s technology partners.

Second,the EU can do more to promote offtake agreements, where European buyers guarantee contracts for new production facilities in partner countries. When revising public procurement rules, it should avoid a too strict ‘Buy European’ policy. This can alienate partners, making offers from others such as China more attractive. Instead choosing a ‘Buy European and trusted partners approach’ would reduce the EU’s dependencies on China and the United States, and gives preferential access to partner countries in, for example, Africa. This will give the bloc more access to the technologies it needs, with less vulnerability.

Alongside diversifying its partners, the EU should also help make company’s green investments in developing countries more secure by addressing the risks that come with using local currency and technology from certain countries. It can do this by, for example, expanding current European Investment Bank programmes for green guarantees. The EU and its member states should also contribute more to multilateral initiatives, such as the Industry Decarbonisation programme of the Climate Investment Fund, that co-funds and provide guarantees for low-carbon investments .

Finally, the EU’s 2040 target includes a proposal to accept “high-quality international credits”. The EU should therefore intensify efforts to support other countries in developing additional low-carbon projects that can benefit from these credits. Some of the income from the carbon border adjustment mechanism—the EU’s carbon price on certain imports—could be used to do this. And such a commitment to reinvestment may help get more global south countries on board with the mechanism.

Context

The 2040 proposal builds on an earlier binding agreement for a 55% reduction target by 2030, that now seems to be within reach, and is a step towards the binding target of climate neutrality by 2050. Member states and the parliament will this month start what is likely to be complex negotiations. In parallel, the EU is trying to improve its relations with many emerging and developing countries, including through Clean Trade and Investment Partnerships.

This article was updated on July 7th 2025 to clarify a recommendation on climate credits.