[WATCH] Malta will make case for special consideration in EU Green Deal, Miriam Dalli says

Enterprise Minister Miriam Dalli anticipates 'long and heated' debate on EU Green Deal proposals, says Malta will make its case for special consideration given its dependence on aviation and shipping

Enterprise Minister Miriam Dalli
Enterprise Minister Miriam Dalli

Malta will be making its case for special consideration as an island on Europe’s periphery in discussions on the EU’s Green Deal, Miriam Dalli said.

The Enterprise Minister said the European Commission’s proposal is only the first step and anticipates a “long and heated” debate to achieve carbon neutrality.

Business leaders have sounded the warning on the Commission’s proposal to tax the aviation and shipping sectors, which have so far been spared from carbon pricing.

Dalli said the disparity between member states will have to be factored in during talks and Malta will be no exception in making its case.

“We have to be able to convince when explaining our particularities,” she said, noting that Malta depended on aviation and shipping for its commercial, travel and tourist connections.

The EU has a target to become carbon neutral by 2050 but also has an interim target to reduce emissions by 55% by 2030.

Dalli said these are EU-wide targets, which will eventually take into account the disparity in progress of the different countries.

She said that Malta managed to convince the European Commission to allow funding for a natural gas pipeline between Sicily and Malta that is hydrogen-ready. 

The Commission had turned down an earlier funding proposal as it shifted its priority away from infrastructure projects for fossil fuels that produce carbon when burnt. Natural gas is a fossil fuel albeit less polluting than heavy fuel oil.

Dalli had argued that Malta’s case was particular since despite its intention to shift to hydrogen there was no readily-available supply of hydrogen fuel in its neighbourhood. The pipeline will have to transport natural gas in the immediate future but be able to shift to hydrogen when this becomes commercially available.

“We will have to make our case and ensure there is enough awareness on the impact of certain measures on Malta,” she said.

The European Commission last week published its Fit-for 55 package, a legislative tool to deliver on the European Green Deal, to reduce greenhouse gas emissions by 55% by 2030.

The package includes several proposals, some of which are new, such as the Carbon Border Adjustment Mechanism, and others revising existing legislations, such as the Energy Efficiency and Renewable Energy Directives, the Energy Tax Directive, and the Emissions Trading Scheme.

One of these laws incentivises clean energy for the transport sector, but includes taxing kerosene for aviation and maritime sectors over the next decade. Brussels wants to introduce a gradual minimum tax-rate on aviation fuel, which is currently exempt, plus a specific sectoral emission reduction target for shipping.

The Brussels representative of Malta’s Chamber of Commerce and hoteliers’ lobby MHRA warned that the climate change legislative package could impact seafaring nations like Malta. 

Malta Business Bureau president Alison Mizzi had said the proposal had to be “studied in detail to quantify the impact” on peripheral countries such as Malta and other island states entirely dependent on these two sectors for the export and import of all cargo as well as tourism activity.

“These legislations will surely impact businesses and consumers, whether directly or indirectly. It is accepted that the status quo is not sustainable. The MBB consistently said that the question is not if we should meet ambitious climate targets, but how to achieve this without undermining the competitiveness of business, particularly SMEs, and those operating in the periphery of the EU,” Mizzi had said.

READ ALSO: Climate rules will tax aviation and shipping, Malta business lobby braces itself