April 19, 2017
Tweet This: Multilateralism is Key to Facing Down the World’s Climate and Investment Challenges
By Werner Hoyer
We face monumental challenges and only together can we surmount them. Though there’s no denying that currently Europe has many problems, it is still collectively convinced of the need to reach out beyond its borders to other continents, to other peoples.
The framework on which this international cooperation takes place is diplomatic and financial. The diplomatic pillar is founded on the United Nations and the financial pillar is based partly around the work of the world’s multilateral development banks. So, tweet this: Multilateralism, the bulwark of our world order, promotes peace and sustainable development. It’s the foundation of our children’s futures.
Yet multilateralism is dangerously called into question these days. Less multilateralism weakens our societies and increases instability. For Europe, it is urgent that the continent reaffirms its commitment to integration, openness, and global cooperation. The European Investment Bank delivers the very benefits that will ultimately convince Europeans they gain from membership of the European Union (EU). In their different regions, all multilateral organizations carry out this kind of unifying work. It’s obvious to anyone who looks beyond the fake-news tweetstorms and examines the facts—multilateralism brings people together.
Contrast this with the populist rhetorical technique of scapegoating an institution or a people. At the heart of the Brexit vote was the scapegoating of the EU for a range of problems often entirely unrelated to it. Scapegoating continues in election campaigns across Europe.
Yet it is not enough to lament the low road that so many political figures have chosen. Those of us who recognize the true challenges facing our world must recommit to battling them. We must also tell our story better. The EU, for example, does amazing work for the citizens of Europe. But its benefits often remain unknown. We must communicate quicker and better about the impact we make.
Nowhere is this more important than in the global battle against climate change. The direction of US policy in this area makes it still more important that international institutions maintain their commitments to climate action. The EIB is the leading provider of climate finance. Over the next five years we will deliver $100 billion in climate-action finance, the largest contribution of any single multilateral institution. Alongside all multilateral development banks, we pledged to catalyze the private finance that will be needed to combat global warming. Much of our investment is intended to provide a cushion for private investors—to make climate action a more profitable prospect and thus to boost the overall amount committed to this vital area.
Too often skeptics cast “climate action” as a peripheral activity that is part of a sinister, liberal plot to cut jobs. In fact, climate action is an antidote to the drop-in infrastructure spending since the financial crisis. Take the €350 million we loaned at the start of April to the first electricity interconnection between Germany and Norway. The 400-mile cable under the North Sea will have a 1,400-megawatt capacity. That is surely the kind of big infrastructure project that everyone can get behind. It is important to note that this interconnection is designed to carry Norwegian hydropower and German wind power, and the EIB’s financing supports the project’s total €800 million investment. In other words, climate action is good for the planet and promotes growth in the economy. I believe most countries will reject withdrawal from multilateralism in this sphere of action, as in others, because they will see it for what it would be: an act of self-harm.
Werner Hoyer is the president of the European Investment Bank. You can follow the European Investment Bank on Twitter @EIB.