EU Overcomes COVID Crisis with Green Industry... Opportunity for Korean Companies

[Asia Economy Reporter Park So-yeon] As the European Union (EU) announced its policy to overcome the economic crisis caused by the novel coronavirus infection (COVID-19) through fostering green industries, an analysis has emerged suggesting that eco-friendly Korean companies supported by the Korean New Deal need to seek entry into the EU market.

According to the 'Post-COVID, Acceleration of the EU Green Economy and Implications' report released on the 27th by the Brussels branch of the Korea International Trade Association, the heads of state of EU countries decided to invest 550 billion euros in carbon-neutral projects aiming for net zero carbon emissions and climate change response. This was announced at the special summit held in July and represents about 30% of the multiannual financial framework and economic recovery fund totaling 1.8243 trillion euros for 2021?2027.

In particular, the EU presented the green industry as a new growth strategy to overcome the COVID-19 economic crisis and has begun reorganizing various systems such as budget expansion, tax reform, and corporate subsidy support. By introducing and expanding environment-related taxes, additional taxes are imposed on high carbon-emitting companies while creating a market where low carbon-emitting companies can gain competitiveness. The increased tax revenue is planned to be reinvested in the development and innovation of carbon emission reduction technologies.

The report stated, "Comprehensive support and legislative system improvements for fostering green industries will solidify the EU’s position as a global leader in climate change response," adding, "If a company possesses excellent technological capabilities, even non-EU companies receive large-scale support such as subsidies and loan approvals, making it a good opportunity for Korean companies seeking to enter the EU."

It continued, "As the number of companies participating in the transition to a carbon-neutral economy increases, the use of renewable energy will emerge as a core element of companies’ global value chains," and "The position of low carbon-emitting companies and countries within the EU will be strengthened, and green industry investment will be promoted not only within the EU but also in the international community, with related industries expected to continue growing."

Kang No-kyung, deputy director of the Korea International Trade Association’s Brussels branch, said, "Our government, which is promoting the Korean New Deal, must understand the EU’s policy trends to advance environmental-related systems and highlight efforts to respond to climate change to establish its status in the future international community," and added, "Our companies should also expand environmental technology development and open innovation to seize business opportunities in the EU market."

This content was produced with the assistance of AI translation services.