Poland, Bulgaria, Croatia and Romania are on track potentially to rapidly scale up their clean tech exports, which could go a long way in helping the EU meet its net zero 2050 target, as well as increase its global competitiveness.
Central and Eastern European (CEE) clean energy technology exports could possibly triple in the coming few years, if their market share at present is maintained, according to the latest World Bank EU regular economic report.
If so, that could go a significant way in bolstering the EU’s global competitiveness, boosting its economy, as well as advancing the bloc’s net zero 2050 efforts.
The countries involved are Croatia, Bulgaria, Romania and Poland.
The technologies include products such as heat pumps, solar panels, electric vehicle batteries, wind turbines and more.
Achieving net zero target ‘vital’
However, achieving the EU’s Net Zero Industry Act (NZIA) goals will be vital in order for CEE clean tech exports to triple. The main NZIA goal aims to have domestic EU production meet about 40% of the bloc’s clean tech needs by the end of this decade and 15% of global clean energy demand by 2040.
This could also reduce the EU’s overall energy dependence on other countries like Russia, especially as the Russia-Ukraine war continues.
Similarly, Central and Eastern European countries could also experience considerable domestic development and increased economic stability, through this potential surge in clean tech exports.
At present, the countries are dealing with significantly higher consumer prices, with food and essentials prices rising particularly fast. That, in turn, has led to worsening food insecurity and poverty, as real wages struggle to keep up with escalating prices.
Anna Akhalkatsi, country director for the EU at the World Bank, said in a press release: “Historically high prices are hitting Europe’s vulnerable people the hardest, with some families spending half their income on food, and low-skilled and blue-collared workers struggling in an uneven job market.
“Targeted social policies are crucial to support those most in need and ensure broader economic inclusion. The green transition offers opportunities to create jobs and boost industries in ways that are fair and far-reaching.”
As such, encouraging more clean tech exports from Central and Eastern European countries could go a long way in helping them recover from financial and economic shocks such as the pandemic.
However, the EU needs to implement a coordinated strategy amongst member states for this to be possible, to prevent internal competition, as well as encourage higher private sector investment. The bloc may also need to invest far more in research and development, along with high quality talent and stronger supply chains.
Could the EU achieve a soft landing in 2024?
The EU economy could be heading towards a soft landing this year, despite interest rates having been hiked for the last several months. This is mainly due to inflation continuing on its downward trajectory and inching closer to the European Central Bank (ECB)’s target of 2%. In November 2024, EU inflation was 2.5%.
Despite aggressive interest rate increases, severe job losses and a significant recession have been avoided, although EU growth did lag last year, which was in line with expectations. Similarly, trade volumes also decreased in 2023, mainly dragged down by the EU’s competitiveness suffering as energy prices continued to scale up.
In 2024, however, employment is starting to pick up, although numbers still vary significantly across different areas, industries and socioeconomic groups. Nominal wage growth has also been relatively resilient, further improving purchasing power amongst consumers.
On the other hand, there are still concerns about whether the full impact of the recent monetary tightening cycle has already reached consumers or if there’s more to come. Another major concern includes escalating trade tensions between the EU and the US, as well as the EU and China. Different rates of economic recovery between member states could also impediment the EU’s ability to achieve a soft landing this year.
