EU ready to compromise on ETS

The European Union could be ready to come to a compromise over its controversial Emissions Trading Scheme (ETS), its transport representative has revealed.

The EC's Director of Air Transport Matthew Baldwin (far left) on stage with SIA's Goh Choon Phong (second left) and John Slosar (far right) in KL

During a panel discussion at the Association of Asia Pacific Airlines’ (AAPA) Assembly of Presidents in Kuala Lumpur on Friday (9 November 2012), the European Commission’s Director of Air Transport, Matthew Baldwin, said the EU was ready to “compromise” over the issue, and that the concessions being made may come as a “surprise”.

“Europe has always wanted an ICAO (International Civil Aviation Organization) solution, and that’s where we’re headed,” Baldwin said during the on-stage debate, which also included the CEOs of Singapore Airlines and Cathay Pacific. “[There is a] compromise coming from Europe. I can’t tell you what we’re going to do yet, but I hope we will surprise come people by how far we’re prepared to go.”

In response to the revelation, SIA’s CEO, Goh Choon Phong said he was “glad to hear” the EU is listening to international opposition to the ETS, and that he is “looking forward to hear how far the EU will go”.

IATA’s Director-General & CEO, Tony Tyler, who was in the audience, agreed that Baldwin’s comments were “very welcome”, but his former colleague, Cathay Pacific’s CEO John Slosar, was more cautious in his response, suggesting that any kind of ‘global ETS’ faced difficulties.

“The fundamental problem is how to balance fast-growing regions, such as Asia, with slow-growing regions like the EU or America,” Slosar said. “All fees are landing on fast-growing markets and that’s not fair. The challenge is to ensure [the ETS solution] happens in a fair way.”

Despite some reservations however, Baldwin’s admission will be welcomed by the majority of airlines and international governments. China, India and Saudi Arabia are all currently refusing to comply with the EU over the controversial carbon tax, while the US is preparing similar legislation.

The international community will now be keen to hear what the EU will propose, with hopes that the measures will be able to end the current stand-off and avert a potentially damaging trade war.

“Watch this space; we have an interesting few weeks ahead of us,” Baldwin said.

By Mark Elliott, 9 November 2012, Friday 6:53 AM