EU climate policies accelerating Europe’s economic decline Article by 19Forty-five

Europe’s economic struggles have deepened since the COVID-19 pandemic, with both absolute and relative decline becoming more pronounced. The gap between the European Union (EU) and the United States has widened significantly. In 2023, the US economy was valued at $26.9 trillion, far surpassing the EU’s $15 trillion. This disparity is growing, as is the wealth gap between American and European citizens. Many blame the EU’s aggressive climate policies, particularly emissions targets, for crippling European industries. While US GDP per capita was only 16 per cent higher than the eurozone’s in 1990, by 2023, the difference had doubled to over 30 per cent.

Germany, long seen as Europe’s economic powerhouse, has struggled to recover from the pandemic, with some analysts branding it the “sick man of Europe.” Economic stagnation has contributed to growing frustration, an article by the 19 Forty Five publication argues, particularly in eastern Germany.

France is also facing serious fiscal challenges, with its deficit rising to 6.1 per cent of GDP and national debt reaching over 3.2 trillion euros—112 per cent of GDP—making its financial situation worse than Italy, Greece, or Spain.

Meanwhile, the United Kingdom has faced years of stagnation, suffering from low productivity and declining output. Italy’s economy is barely growing, with GDP forecasts for 2024 and 2025 hovering around 0.5–0.8 per cent. Poland is a rare bright spot, with its economy expected to grow by 3.6 per cent in 2025, though other Central and Eastern European economies have underperformed.

The author believes that Europe’s economic crisis goes beyond short-term downturns. European energy costs are two to three times higher than in the US, with taxes making up nearly a quarter of the price. The UK has the highest electricity costs in the developed world, four times higher than in the US These energy policies, driven by strict climate mandates, have made European industries less competitive globally.

EU climate policies

At the core of Europe’s economic challenges is its goal of becoming climate-neutral by 2050, a legally binding commitment under the European Green Deal. The plan requires a 55 per cent reduction in greenhouse gas emissions by 2030, yet the EU accounts for only 6 per cent of global emissions—far behind China, the US, and India. Critics argue that even if Europe eliminated all emissions, it would have little impact on global climate change. Meanwhile, these policies are weakening European economies, threatening social stability.

Despite economic stagnation, EU leaders remain committed to the Green Deal, insisting that it will drive economic growth, create jobs, and ensure a “just transition” for all. However, this optimism clashes with the economic reality: the EU’s climate strategy is unraveling Europe’s post-war socio-economic model. Without economic growth, Europe’s extensive welfare systems and high living standards could collapse, triggering unpredictable political consequences.

Unless the EU reconsiders its approach, the author is convinced the continent faces deepening economic and political crises. Some European politicians have begun questioning the rigid climate policies, but he warns that time is running out to find a balanced solution that addresses environmental concerns without undermining economic stability. The challenge now is whether Europe can shift to a more pragmatic, less ideological approach before irreversible damage is done.

By Nazrin Sadigova