One trillion Euros for climate
Over 150 prominent people have signed a statement demanding bolder actions to fight climate change, including using the ECB's Quantitative Easing (QE) programme to kickstart the energy transition
Climate change is a reality and the worst effects are yet to come if action is not taken now. In an unprecedented move, 150 economists, politicians and trade unionists have signed a statement calling for a European Climate-Finance pact urging the European Central Bank (ECB) to use its monetary policy to fight climate change.
The statement makes a great case for Green Quantitative Easing (QE): 'Since the ECB recently decided to extend its Quantitative Easing policy, it seems urgent to us to "direct" money creation into the real economy and finance, in all the Member States, the energy savings and the development of renewable energies.'
Amongst the impressive list of signatories are 10 MEPs including Sirpa Pietikainen (Finnish MEP, EPP), Philippe Lamberts (President of the Greens at the European Parliament) and Isabelle Thomas (Vice-President of the Socialists and Democrats in the European Parliament), former president of the European Investment Bank - Philippe Maystadt, former French Prime Minister - Jean-Marc Ayrault, former director of the World Trade Organisation Pascal Lamy, former president of the EU Commission - Romano Prodi, and a number of economists in support of the QE for People campaign including Tim Jackson, Steve Keen, Alain Grandjean, Gaël Giraud and Pierre Larrouturou.
The QE for People campaign is happy to support this pact as it builds on our work over the past 2 years. As the ECB president Mario Draghi recently recognised, the ECB's mandate is broad enough to cover environmental goals, as long as those objectives do not interfere with its primary goal, namely price stability. As flagged by the 70 NGos earlier this year, the current ECB's QE programme is skewed towards carbon-intensive companies. Adopting a green quantitative easing approach would not only align the ECB's policies with the EU's key objectives, but would also likely be more economically effective.
The pact has been published in Le Monde today, ahead of the climate finance summit led by French president Emmanuel Macron and the next ECB's governing council meeting on Thursday. Despite the reduction of QE to €30bn, it provides an opportunity for it to be put to better use. For example, channeling QE towards green investments. European policymakers should not miss this historic opportunity to agree to financial commitments and changes in monetary policy to better accommodate tackling climate change.
For more details, please visit www.climat-2020.eu
Picture Credit cc: Le Monde