EU landmark rule on green investments back on track

European Commission President Ursula von der Leyen gives a statement in Brussels. (AP pic)

BRUSSELS: European Union lawmakers agreed on Monday to support a proposal on rules governing which financial products can be called “green” and “sustainable” after EU member states rejected a deal on it last week.

The proposal has the potential to make the EU a leader in the booming US$200 billion green bond market.

Last week, representatives from EU member states backtracked on their approval of a deal reached after months of discussions, noting concerns over the legislative text.

Britain, France, the Czech Republic, Hungary, Poland, Slovakia, Romania, Bulgaria and Slovenia had opposed the deal, fearing it would prevent investments in nuclear and coal projects from being labelled as green.

This proposed law is a first step toward establishing a framework labelling system for sustainable investments. A full set of labels will be developed in 2021.

The bill is expected to be approved by representatives from all EU member states on Wednesday and then sent to the EU’s executive, the European Commission, which will sign it into law.