PolicyStudyN.23ANTICIPATINGANDMITIGATINGSIDEEFFECTS:THEROADTOASUCCESSFULGREENTRANSITIONINTHEEURO-MEDITERRANEANREGIONTizianadellaRagioneCoordinatorLauraBasagniLarbiToumiAzizaMoneerANTICIPATINGANDMITIGATINGSIDEEFFECTS:THEROADTOASUCCESSFULGREENTRANSITIONINTHEEURO-MEDITERRANEANREGIONTizianadellaRagioneCoordinatorLauraBasagniLarbiToumiAzizaMoneerPolicyStudyN.23PeerReview:HoudaAllalAcademicPeerReviewer:AnonymousEditingJustineLeïlaBelaïdDesignlayoutMaurin.studioProofreadingNeilCharltonLayoutNúriaEsparzaPrintISSN2462-4500DigitalISSN2462-4519ArabicversionISSN2696-7626April2022PublishedbytheEuropeanInstituteoftheMediterraneanPOLICYSTUDYThispublicationhasbeenproducedwiththeassistanceoftheEuropeanUnion.ThecontentsofthispublicationarethesoleresponsibilityoftheauthorsandcaninnowaybetakentoreflecttheviewsoftheEuropeanUnionortheEuropeanInstituteoftheMediterranean.EuroMeSCohasbecomeabenchmarkforpolicy-orientedresearchonissuesrelatedtoEuro-Mediterraneancooperation,inparticulareconomicdevelopment,securityandmigration.With116affiliatedthinktanksandinstitutionsandabout500expertsfrom30differentcountries,thenetworkhasdevelopedimpactfultoolsforthebenefitofitsmembersandalargercommunityofstakeholdersintheEuro-Mediterraneanregion.Throughawiderangeofpublications,surveys,events,trainingactivities,audio-visualmaterialsandastrongfootprintonsocialmedia,thenetworkreachesthousandsofexperts,thinktankers,researchers,policy-makersandcivilsocietyandbusinessstakeholderseveryyear.Whiledoingso,EuroMeSCoisstronglyengagedinstreamlininggenuinejointresearchinvolvingbothEuropeanandSouthernMediterraneanexperts,encouragingexchangesbetweenthemandultimatelypromotingEuro-Mediterraneanintegration.AlltheactivitiesshareanoverallcommitmenttofosteringyouthparticipationandensuringgenderequalityintheEuro-Mediterraneanexperts’community.EuroMesCo:ConnectingtheDotsisaprojectco-fundedbytheEuropeanUnion(EU)andtheEuropeanInstituteoftheMediterranean(IEMed)thatisimplementedintheframeworkoftheEuroMeSConetwork.Aspartofthisproject,fiveJointStudyGroupsareassembledeachyeartocarryoutevidence-basedandpolicy-orientedresearch.Thetopicsofthefivestudygroupsaredefinedthroughathoroughprocessofpolicyconsultationsdesignedtoidentifypolicy-relevantthemes.EachStudyGroupinvolvesaCoordinatorandateamofauthorswhoworktowardsthepublicationofaPolicyStudywhichisprinted,disseminatedthroughdifferentchannelsandevents,andaccompaniedbyaudio-visualmaterials.TheEuropeanInstituteoftheMediterranean(IEMed),foundedin1989,isathinkanddotankspecialisedinEuro-Mediterraneanrelations.Itprovidespolicy-orientedandevidence-basedresearchunderpinnedbyagenuineEuromedmultidimensionalandinclusiveapproach.TheaimoftheIEMed,inaccordancewiththeprinciplesoftheEuro-MediterraneanPartnership(EMP),theEuropeanNeighbourhoodPolicy(ENP)andtheUnionfortheMediterranean(UfM),istostimulatereflectionandactionthatcontributetomutualunderstanding,exchangeandcooperationbetweenthedifferentMediterraneancountries,societiesandcultures,andtopromotetheprogressiveconstructionofaspaceofpeaceandstability,sharedprosperityanddialoguebetweenculturesandcivilisationsintheMediterranean.TheIEMedisaconsortiumcomprisingtheCatalanGovernment,theSpanishMinistryofForeignAffairs,EuropeanUnionandCooperation,theEuropeanUnionandBarcelonaCityCouncil.ItalsoincorporatescivilsocietythroughitsBoardofTrusteesanditsAdvisoryCouncil.PolicyStudyContent8121630425876ExecutivesummaryIntroductionTizianadellaRagioneHowtheEUGreenDealShapestheAgendafortheMediterraneanLauraBasagniAGreen-BlueDealfortheMiddleEast:APoliticalGameChangerforEUClimate-SecurityBeyonditsBordersTizianadellaRagioneIstheNationalSustainableDevelopmentStrategyRespondingtoaSuccessfulGreenTransition?TheCaseofMoroccoLarbiToumiIsGreenMENAPossible?ProspectsforOilProducingCountriesAzizaMoneerListofacronymsandabbreviationsExecutiveSummaryTheEuropeanUnion(EU)hassetambitiousclimatetargetstoreachinthespanofthenext30years,includingacollectivenetgreenhousegasemissionsreductiontargetofatleast55%by2030(comparedto1990levels)andtheobjectiveofaclimateneutralEuropeby2050.TheEUdecarbonisationprocesscanhavesignificantpositivesideeffectsexternally,includingintheEuropeanneighbourhood.However,toproducewin-winoutcomes,equityshouldbekeptattheforefrontofclimatecooperationthroughbothdiplomaticeffortsandtechnicalandfinancialassistance.EuropeaninstrumentssuchastheCarbonBorderAd-justmentMechanism(CBAM)andtheEU’sGreenTaxonomyareacaseinpoint.CBAMisexpectedtohaveanimpactintheSouthernNeighbourhood(SN),forexampleinthemarketoffertiliser-exportingcountriessuchasMorocco,AlgeriaandEgypt.Tomakethemeasuremoredigestiblefortradingpartners,theEUcouldconsiderdeferringrevenuetothemtomaximiseinvestmentinbettertech-nologiesanddiscouragepollutingbusinessmodels.TheEU’sgreentaxonomyalsoaffectsnaturalgasproducers(Egypt,AlgeriaandIsrael)intheMediterranean,asgasisonlylistedinthetaxonomyasatransitionalfuel,withoutprovidingacomprehensivelong-termsolutionwhentheEUmovesawayfromfossilfuelconsumption.TheEUshouldthereforecontinuetodeepencooperationwithenergysuppliersintheSNbothbilaterallyandregionallyintheattempttosupportenergydiversificationonbothshoresoftheMediterraneananddeveloprenewableenergysources,withtechnicalandregulatorysupportwhereneeded.Inthecontextofenergydiversification,greenhydrogeniscertainlyaverypromisingtechnologyinsomeSNcountries,suchasAlgeriaandMorocco.YetEUaccompanyingmeasureswillbenecessarytofacilitatebilateraltradingagree-ments.FortheEuropeanGreenDealtobesuccessfulindrivingthegreentransitiondo-mesticallyandglobally,internalandexternalEUpolicydecisionsmustbefinetunedwithclimateambitions,andtheclimatedimensionneedstobeincludedinallpoliciesandsectors.Inaddition,climatediplomacywillcontinuetoplayakeyroleinEUexternalpolicyfortheyearsaheadanditwillhavetobepairedwithgreenfinancetomanagethefutureoftradepatternsincarbon-intensiveindustries,especiallyifasymmetriesofclimateeffortscontinuetoexist.PolicyStudyn.23IntheMiddleEast,toovercometheintrinsiccomplexity,theEUshouldhaveastrongerhigh-levelpoliticaldrivefocusingonbigscaleandambitiousprojectswhichaddressclimatechange.RadicalchangesintheMiddleEastregionarepossible,andtheframeworkofwaterandenergyinterdependenciesamongregionalactorscouldbeapoliticalgamechangerforEUclimatesecurity.Nonetheless,thecomplexityoftheregionrequiresthemobilizationoftherightincentivestoattractleadinggreeninvestmentsandmitigatethepoliticalrisk.TheUSwasabletobrokera"renewableenergyfordesalinatedwater"agreementbetweenIsraelandJordaninNovember2021.TheEUcouldusethisprojectasanexampletobuilditsown,equallyambitious,butincludingthePalestiniansinregionalclimateagreements.ThelattercouldpavethewayforgreaterEUinvolvementinrevampingtheIsraeli-Palestinianpeaceprocess,notbasedontheineffective“landforpeace”formulabutonanew“cross-borderclimateandwatersolutionsforpeace”formula.Todate,theEU’sconcreteinvolvementinregionalinitiativespromotingclimate-resilienttransboundarysolutionsremainslimited,despiteitseffortstostrengthenitsdiplomaticengagementonwateranditswillingnesstoimproveregionalcooperationonenergy,environment,andclimateaction.Inthisrespect,theEUneedstomainstreamtheenergy-waternexusintopolicydevelopmentsandprogrammedesignandimplementation.ThelatterisalreadyencouragedbytheEuropeanCommission(EC).Regardingcross-bordercooperationbetweendifferentEUDelegations,itisrec-ommendedthattheEUreviewitsinternalmechanismtoensurethatregionalco-operationisoperational.Thecompartmentalisationofresponsibilitiesingeographicallydistinctlocations–BrusselsfromonesideforthedesignandtheimplementationofregionalprogrammesindifferentthematicareasandEUDelegationsfromtheotherforthebilateralcooperationwiththespecificcountry–hasimpactedontheoptimaldeclinationofbilateralandregionalcooperation.Thisisparticularlytrueinconflict-drivenregions,suchastheMiddleEast,wherepoliticalconstraintsandtechnical-legal-administrativechallengeshavepreventedcross-bordercooperationamongdifferentEUDelegations.OnewaytoimprovethecurrentsituationcouldbetopromoteclosercooperationbetweentheEUDelegationsonthegroundandtheUnionfortheMediterranean(UfM),whichisresponsibleforarticulatingregionalpoliticaldialogueondifferentthematicareas.EUDelegationsareakeyresourceinfacilitatingcooperationnotonlyatabilaterallevelbutalsoatregionalone.AnumberofsuccessfulinitiativespromotedbytheEUDelegationinIsraelhavedemonstratedthatscienceandclimatediplomacyisanimportantlevertopromotepeacefulandprosperousrelationsamongregionalactors.EUdelegationsshouldcooperatemorecloselyonclimate-relatedinitiatives,PolicyStudyn.23andfacilitatetheinvolvementoftheEuropeanInvestmentBankwithlocalstakeholders,leveragingitspossiblefinancialsupportinregionalgreenprojects.TheDelegationsoftheEUtotheGulfcountriescouldalsobepartofthisattemptatregionalcooperation,astheGulfcountrieshaveshowngreatinterestininvestinginlarge-scaleprojectstosupportclimateissuesintheMiddleEast.ThelatterisinlinewiththegoalofexternalisingtheEuropeanGreenDeal.TheEUshouldlookattheSouthernNeighbourhoodasakeystrategicarea,whichnotonlycancontributetothesuccessofthegreentransitionoftheentireEuro-Mediterraneanregion,butcanalsoensurethediversificationoftheEU'senergysupplybyprovidingbothcleanenergyandfossilfuels.Infact,theEUisexpectedtoremainsignificantlydependentonoilandgasimportstomeetitsenergydemands,atleastforthenextfewdecades.ToreduceitsenergydependenceonRussia,asrecentlyplannedinitsRePowerEUstrategy,theEUshouldexplorewithAlgeriaandLibyathepossibilityofincreasingitsfossilfuelimports,whileIsraelandEgyptcouldbepotentialnewpartnersforgassupply.Ontheotherhand,theEUalsoneedstoincreasethesupplyofcleanenergy.Amongtheselines,AlgeriaandMoroccoarecertainlypromisingcandidatesforgreenhydrogen,andtheEU'sbilateralcooperationistheperfecttooltofacilitatetradeagreements.LookingtotheMiddleEast,JordancouldbecomethesolarhubfortheMiddleEastandexportenergytothenorthernshoreoftheMediterraneanonce/ifpowergridswithitsneighbors,suchasIsrael,areinterconnected.Finally,itisimportanttoemphasisethatexternalisingtheEuropeanGreenDealcan-notoccurwithoutstrengtheningtheexistingbilateralgreenpartnershipbetweentheEUanditssouthernneighbours.Moroccoisaclearexample,wherethedevel-opmentofanationalclimatefinancestrategyandtheacquisitionofexpertiseinthetechnicalandfinancialdesignofadaptationandmitigationprojectsarehighlyde-pendentoncooperationwiththeEU’smainclimateactioninstitutions,suchastheEuropeanInvestmentBank(EIB),theFrenchDevelopmentAgency,andtheEuro-peanBankforReconstructionandDevelopment(EBRD).Giventherolethatre-searchandinnovationcanplayinacceleratinganddirectingMoroccotowardsthegreentransition(i.e.,HorizonEuropeprogramme),acquiringcutting-edgetech-nologiesinspecificareassuchasrenewableenergycanmaketheMorocco-EUgreenpartnershipmoreeffective.Inthisdirection,theestablishmentofagreenpartnerlabelofrelationsbetweentheEUandMoroccowillfacilitateaccesstoandassociationwithEUinitiatives,politicaldialogue,andfunding.Regardingthecoop-erationingreenhydrogen,thegreenpartnershipbetweenthetwopartiesshouldcontributetotheestablishmentofahigh-levelstrategiccommitteewiththeobjectiveofdevelopingaroadmapbasedonanin-depthanalysisoftheopportunitiesandconstraintsforasuccessfulgreenhydrogenstrategicalliance.Itisdesirabletose-curethisalliancebysettingupspecificfinancialmechanismsaccordingtothewin-winpartnership,specifyingthecontributionsofeachpartyandaffectingallthelinksinthegreenhydrogenchain.11AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegionIntroductionTizianadellaRagioneResearchAssociateattheInstituteforNationalSecurityStudies(INSS)&ResearcherattheMosheDayanCentre(MDC),TelAvivUniversity13AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegionAprosperous,greenerandmorestableSouthernNeighbourhood(SN)isastra-tegicpriorityforSNcountriesthemselvesandtheEuropeanUnion(EU).InitsJointCommunicationonaRenewedPartnershipwiththeSouthernNeigh-bourhoodreleasedinFebruary2021,theEuropeanCommission(EC)setsoutanewAgendafora“green,digital,resilientandjustrecovery,guidedbythe2030AgendaforSustainableDe-velopment,theParisAgreementandtheEuropeanGreenDeal.”Furthermore,thepost-COVID-19contexturgesustorediscovertheroadtopros-peritythroughthetransitiontoasus-tainableandgreeneconomicmodel.However,despitethepoliticalwillandinitiativesputinplaceintheregion,thegreentransitiononthesouthernshoreoftheMediterraneanhasproventobemorechallengingandcomplexthanonitsnorthernshore.Decarbon-isationpoliciesandlow-carbontech-nologyadvancementsarecurrentlyunder-goingstructuraltransformationintheglobalenergyarchitecture,andtheSN,1endowedwithhalfoftheworld’sknownoilandgasreservesisparticularlyex-posedtothesechanges.Indeed,thenewglobaltradepatternsriskdestabil-isingthosecountrieswhoseeconomiesdependprimarilyonoilandgasexports.Furthermore,theMiddleEastregionwarms20%fasterthantherestoftheworldandtheimpactsofclimatechange,suchaswaterscarcityanddesertification,arealreadyaffectingregionalstability(e.g.,inJordan,SyriaandPalestine).Lastbutnotleast,globalpowerssuchasChinahavesignificantlyincreasedtheirgeo-strategicinterestsintheMedi-terraneanSea,promptingtheinternationalcommunity,includingtheEU,toaddressthegeopoliticalandgeo-economicdi-mensionsoftheGreenDeal,especiallyintheSN.ThisEuroMeSCoPolicyStudyseekstotakestockofhowSouthernMediterraneancountriesarereactingtothetransformationoftheglobalenergyarchitecture,whatopportunitiesareofferedbytheEuropeanGreenDealand,atthesametime,whatobstaclesthegreentransitionintheregionisfacing.1.WhatarethepolicyimplicationsoftheEUGreenDealonrelationswithSNcountries?2.WhatoptionsareavailabletomitigatetheforeignpolicysideeffectsoftheEU’sinternaldecisioninthefieldsofenergypolicy,decarbonisationandcli-matefinance?HowcantheEUandSNcountriestakeadvantageofthemultiplechannelsofcooperationattheirdisposal–includingtradene-gotiations,associationagreements,andavarietyofformalandinformalties–tocollectivelyensureasuccessfulecol-ogicaltransitionintheEuro-Mediterra-neanregion?3.WhatistheimpactoftheEUGreenDealonthefossilfuelexportingcoun-triesintheMiddleEastandNorthAfrica(MENA)regionandhowcantheEUpoliciesandactionsbeframedinordertoalleviatepossiblenegativeimpactsinthesecountries?4.WhatroleshouldtheinternationalcommunityplayintheSouthernMedi-terraneanandwhatmitigationmeasures1EUcooperationwiththeSNtakesplaceintheframeworkoftheEuropeanNeighborhoodPolicy(ENP)andincludestenpartnercountries:Algeria,Egypt,Israel,Jordan,Lebanon,Libya,Morocco,Palestine,SyriaandTunisia.PolicyStudyn.23AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegion14shoulditputinplacetosupportasuc-cessfulgreentransitionintheregion?5.Howdogovernanceissuesandtech-nicalbarriersimpedethedevelopmentandimplementationofgreentransition?Howcansustainableagriculturebereconciledwiththeimperativeoffoodsecurityinthecontextofclimatechangeandwaterscarcity?Howcanclimatefinancebeusedforasuccessfulgreentransition?Thepolicystudyseekstoanswerthesequestionsthroughfourindividualcontribu-tions,eachonaspecificarearelatedtogreentransition,butallwiththecommongoalofanticipatingandmitigatingitssideeffectsintheSNregion.Altogethertheytrytoenvisageawayforwardforasuc-cessfulgreentransitionintheEuro-Medi-terraneanregion.Inallthechapters,semi-structuredinterviews,conductedremotelyorinpersonwhenpossible,complementthedeskandfieldresearch.HowtheEUGreenDealShapestheAgendafortheMediterraneanLauraBasagniProgrammeManager,GermanMarshallFundoftheUnitedStates(GMF)17AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegionIntroductionTheEuropeanUnion(EU)hassetambi-tiousclimatetargetstoreachinthespanofthenext30years,includingacollectivenetgreenhousegas(GHG)emissionsreductiontargetofatleast55%by2030(comparedto1990levels)andtheobjectiveofaclimateneutralEuropeby2050.Thesuccessfulachiev-ementofthesegoalsrequiresanall-en-compassingtransformationofeconomicsystemsandstructures:theEUGreenDeal(EC,2019)providesthepolicyframeworkforsuchtransformationandthecompassforallEUpoliciestobestreamlinedwithitsenvironmentalandclimateambitions,whiletheproposedFitfor55(EC,2021b)strategyprovidestheimplementationguidelinesforthenext10-15years.TheRenewedPartnershipwiththeSouth-ernNeighbourhood,ANewAgendafortheMediterranean(EC&EEAS,2021),launchedon9February2021,sets“anewagendafortheMediterranean”andincludesthegreentransitionasoneoffiveprioritiesforcooperation.Thecom-municationidentifiesaspillarsofthegreentransition:greengrowthandcli-mateaction;energytransitionandenergysecurity;resourceefficiency,fightagainstpollutionandprotectionofbiodiversity;andsustainablefoodsystems.ThegoalofmainstreamingclimateactionacrossallfundsisadequatelyreflectedinthenewframingoftheEUSouthernNeighbourhood(SN)strategy,aswellasintheNeighbourhood,Development,andInternationalCooperationInstrument(NDICI),30%ofwhichisearmarkedforgreenprojects.However,thisremainsarelativelynewfieldofcooperation,whichisfurthercomplicatedbytheall-encompassingnatureoftheclimatechallengeandthedifferentlevelsofeconomicdevelopmentsamongMedi-terraneancountries.Whilethelevelofcoherenceamongtra-ditionalexternalpolicieshasbeenex-ploredbypolicyandacademiaalike,relativelylessattentionhasbeenpaidtothenexusbetweeninternalandex-ternalpolicy-makingandthesideeffectsofinternaldecisionsonrelationshipswiththirdcountries.Thisisparticularlyrelevantinthecaseofenvironmentalpolicyandclimateaction,asclimatechangeisdrivenbyeconomicactivitiesandmarketpractices,andithasintenseconsequencesforstability,securityandmigrationpatterns.Theinterconnectionsbetweenpoliciesarevastandmany,thereforeblurringthelinebetweeninternalandexternalpolicy-making.TheexternaldimensionofEUclimatepolicywillbethefocusofthischapter,inparticulartheeffectsoncountriesoftheSN.There-searchincludestheanalysisofrelevantEUofficialdocumentsaswellasaseriesofsemi-structuredinterviewswithstaffmembersofEUDelegationstotheSNcountries.ThesectionontheCarbonBorderAdjustmentMechanism(CBAM)alsobenefitedfromaseriesofconsulta-tionswithstakeholdersfromthepublicsector,businessandcivilsocietyintheEUandthirdcountriesthatwillbeim-pactedbythispolicymeasure.FortheGreenDealtoprovideablueprintforthegreentransformationdomesticallyandabroadthechallengeistostreamlinepolicy-makingwithclimateambitionsacrosstheboardandensurecoherencebetweeninternalandexternalstrategies.TheEUwalksatightropebetweenthepursuitofitsowndecarbonisationandtheriskofalienatingitspartners,whileatthesametimepushingthemtobebolderintheirgreentransformation.Onacase-by-casebasis,Europeandiplo-macywillplayafundamentalrole.PolicyStudyn.23AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegion18EUexternalenvironmentalimpactAsoneoftheworld’sbiggestmarketeconomies,theEUhasastrong,negativeenvironmentalimpactbeyonditsborders.DevelopedeconomiesincludingtheEUhavehistoricallybeenresponsibleforamajorshareofglobalriseintemperatures,causingenvironmentaldegradationandclimatechangewithinandbeyondtheirterritories(Ritchie,2019).TheEUisalsoasignificantconsumerofimportedre-sources,includingenergy,andassuchitsconsumptionpatternsgeneratesig-nificantlyhigherenvironmentalimpactoutsidethaninsidetheEU(Biedenkopf&Groen,2021).Similarlytoothermajoreconomies,theEUhasalsohadanunintentionalnegativeenvironmentalimpactonthirdcountriesthroughpoliciesthatpursuegoalsthatareinherentlyatoddswithsustainability(Biedenkopf&Groen,2021).Clearexamplesareinthedomainsofbothcompetitionpolicy–suchassubsidisingfossilfuelprojectsandunsustainablepro-ductionpracticesintheagri-foodindustry–andtradepolicy.Traditionaltradepoliciesserveeconomicobjectivesthathavenotinternalisedenvironmentalcosts,andthereforecanbearnegativeconsequencesfortheenvironmentandtheclimate.Tradeagreementsthatincreasetheproductionforimportofcommoditieslikemeat,ferti-lisers,palmoil,tonameafew,aredirectlylinkedtodeforestation,landdegradation,andtheincreaseofcarbonemissionsinexportercountries(Goldmanetal.,2020).TheEuropeanCommission(EC)iscur-rentlyengagedinareviewprocessofitstradeandsustainabledevelopmentstrat-egy,andongoingnegotiationssuchastheEU-Mercosurtradedealnegotiationshavethepotentialtomarkaturningpointfortheintegrationofenvironmentalcon-cernsintotheEUtraderegime.Yet,thefullintegrationofenvironmentalobjectivesintointernalandexternalpolicyareashasbeenrecognisedassomethingthatstillneedstobetackledfully(Biedenkopf&Groen,2021).Ontheotherhand,thesizeandopennessofthesinglemarket–theEUaccountsfor14%ofglobaltradeingoods2–pro-videstheEUwithastrongpowertoex-erciseapositiveinfluenceexternallythroughthemarketitselfandthroughactiveclimatediplomacyandtechnicalcooperationtocreateconvergencewiththirdcountries.ExternaleffectsofinternalpolicydecisionsTheEUdecarbonisationprocesscanpo-tentiallyhavesignificantpositivesideef-fectsexternally,includingontheEuropeanneighbourhood.TheEUleadsbyexamplebychangingitsownrulesofproductionandconsumption,regulatingitsownmar-ketandcreatingincentivestoothercoun-triesgloballytoimplementequivalentnormstokeepaccesstothesinglemarket.Thisunintentionalexternaleffectofregu-latingthesinglemarketknownasthe“Brusselseffect”(Bradford,2020)givestheEUpowertoshapetheinternationalbusinessenvironmentandelevateitsownstandardsglobally.TherearefewglobalcompaniesthatcanaffordnottotradeintheEU,andthepriceforaccessingthesinglemarketisadjustingtheirconductandproductiontoEUstandards,whichareoftenthemoststringentstandardsglobally(Bradford,2020).ExamplesofEUregulationswithaglobalimpact2Moredataavailablehere:https://ec.europa.eu/eurostat/statistics-explained/index.php?title=International_trade_in_goods#:~:text=The%20EU%20accounts%20for%20around,harder%20to%20trade%20across%20bordersAsoneoftheworld’sbiggestmarketeconomies,theEUhasastrong,negativeenvironmentalimpactbeyonditsborders19AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegionincludethe2016GeneralDataProtectionRegulation(GDPR),theEU’sRegistration,Evaluation,AuthorisationandRestrictionofChemicals(REACH),andtheinclusionoftheaviationsectorintheEUEmissionsTradingSystem(ETS),tonameafewno-tablecases.Bychangingitsmarketprac-ticestobealignedwithitsclimateambitions,thereisastrongpotentialfortheBrusselseffecttomanifestandacceleratethegreentransitionbeyondtheEUborders,asthirdcountriesandbusinessesmightchoosetoadapttheirowntoEUrulestokeepaccesstothesinglemarket.Asclimateactionbecomesapriorityin-ternally,italsogrowsinimportanceex-ternally.TheEUisincreasinglymovingtowardsactivelydiscouraginginvestmentsinpollutingsectors,suchasfossilfuels,asshownbytheEuropeanInvestmentBank(EIB)’sdecisiontobecomea“greenbank”byendingallinvestmentsinfossilfuelenergybytheendof2021(EIB,2019);andthedealstruckattheConfer-enceofthePartiestotheUnitedNationsConventiononClimateChange(COP26)inGlasgowinNovember2021,pledgingtoendpublicinvestmentsinfossilfuelenergyextractionandproductionabroadby2022.SeveralEUcountriesjoined,includingBelgium,Italy,France,GermanyandSpain.3ThenewframeworkoftheEuropeanNeighbourhoodPolicy(ENP)includesclimateactionasoneofthemainprioritiestodrivethegreentransitionandhighlightshowtheGreenDealrepresentsauniqueopportunityforcooperationonstrategicprioritiesunderthebroaderumbrellaoftheParisAgreement.Theemphasisisputonclimategovernanceanditslinkwithpublicfinancesandfiscalinitiatives;supportingcarbonpricinginitiativesinlinewiththeEU’sowncarbonmarket;technicalassistancetosupportpublicadministrationsatalllevelsofgovernancetoimplementlegislativechanges;andeducationandawareness-raisingaroundclimatechange.TheEUalsointendstohelpmobiliseinternationalpublicandprivatefinancetoattractthenecessaryinvestmentsinstrategicinfrastructureforthegreentransition,inparticularenergy,waterandtransport.TheNDICIwillbethemainEUfinancialinstrumenttosupporttheneighbourhoodpolicyunderthenewbudgetcycle2021-27,with30%ofthefundsearmarkedforgreenobjectives.Inaddition,therecentlyunveiledGlobalGateway–theEUcon-nectivitystrategy–planstomobilise€300billionbetween2021-2027forconnectivityprojectsaroundtheworld,includinginthefieldsofclimateandenergy(Tagliapietra,2021).ThenarrativeintheNewAgendafortheMediterraneancarefullyframesthegreentransformationasanopportunity.Thisisimportantinthebroadercontextofglobalclimatenegotiationsbetweenpost-industrialanddevelopingcountries,astheprincipleofequityandthecon-ceptsof“commonbutdifferentiatedre-sponsibilities”and“respectivecapabil-ities”underpintheprocess(UNFCCC,2015).Developingcountriesemphasisetheirneedtopursueeconomicdevel-opmentandcontributealargershareofglobalcarbonemissions,whilepost-in-dustrialcountriesdrasticallycutbackontheirown(Ulgen,2021).Fossilfuelex-portingcountriesfaceparticularlydifficultchallengestodiversifytheireconomyandmaintainenergysecurity.InitsnarrativetheEUacknowledgesthatbutalsoem-phasisestheopportunitiesthatclimateactionprovidesto“helpmitigaterisksto3Thecompletetextandlistofsignatoriesareavailablehere:https://ukcop26.org/statement-on-international-public-support-for-the-clean-energy-transition/ThenarrativeintheNewAgendafortheMediterraneancarefullyframesthegreentransformationasanopportunityPolicyStudyn.23AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegion20humanlivesandlivelihoodsandpromotesustainabledevelopment,jobcreationandtransitiontohighvaluesectors”(EC&EEAS,2021).EUclimatediplomacyBesideregionalframeworksliketheENP,theEUcoordinatesitsexternalclimateactionthroughdiplomaticefforts.ThefirstEUClimateDiplomacyActionPlanwasdevelopedin2015andrevisitedlastin2018(6125/18).AseriesofinterviewswithstaffmembersofEUDelegationsintheSNcountriesshowedthattheeffectoftheGreenDealonEUdiplomacywillonlybefullyappreciatedwithtime.YetthenewpolicyframeworkoftheGreenDealhasalreadyreinforcedthemessagethatclimateisacoreinterestfortheEU,andclimateactionhasshiftedfrombeinganelementtomainstreamacrosspoliciestoonetoprioritise.Technicalandfinancialassistanceinrelationswithneighbourhoodcountriesisstronglytiedtoenvironmentalstandardsandclimatetargets.Thatsaid,theextenttowhichclimateco-operationispursuedwitheachSouthernMediterraneancountryvariesonacase-by-casebasis.Thisisparticularlyduetothelevelsofstabilityandsecurityineachcountry,andclimatecooperationisper-ceivedaslessofapriorityincrisis-proneenvironments,likeLebanonandPalestine.Theenergymix–inparticular,towhatextentthecountryreliesonitsownreservesoffossilfuelenergy,andtowhatextentca-pacityforrenewableenergyproductionhasbeendeveloped–andthematurityoftheenergysectorintermsoftransparencyandefficiencyarealsoimportantelementstoshapebilateralclimategoals.Thepoliticalprioritiesineachcountryandthedegreeofdomesticsupportforclimateactionalsoplayarole.Publicopinionintheregionisnotfullyengagedwithclimateandenvi-ronmentalissues.DespitetheMediterraneanregionbeingoneofthemostseverelyaf-fectedbyclimatechangeintheworld,withtemperaturesrisingatamuchfasterpacethantheglobalaverage,anddevas-tatingconsequencesforkeysectorssuchastourism,agricultureandpublichealth(MedECC,2020),thelinkwithclimateac-tionisnotfullyappreciatedbycitizensandpoliticiansalike,andenvironmentministriesareoftenunderfunded,makingitdifficultfortheimplementationofnationalclimatetargetstosucceed.TheroleofEUDelegationsisalsoimportant,anditvariesdependingonthequalityandintensityofrelationswithBrussels-basedinstitutions,theexpertiseofeachDelega-tion’sstaffmembers,andthehostcountrycontext(Biedenkopf&Petri,2019).TheycanplayakeyroleinimplementingEUcli-matediplomacythroughoutreachactivities–especiallyaroundglobalsummitsandinternationalnegotiations–bysharingtheEUexperienceandadvocatingforclimateasapolicypriorityvis-à-visforeigngovern-ments.Buttheyalsoplayakeyroleinpro-vidingBrusselswithfirst-handanalysisofthelocalcontextandpoliticalperceptionthatcanfeedintoheadquarters’policiesandstrategies.Thereisastrongpotentialtonurtureusefulfeedbackloops.IndividualentrepreneurshipandinitiativebyDelegationstaffhaveastrongroleindeterminingthedegreetowhichDelegationsareactiveplayersinshapingEUclimatepolicyexter-nally(Biedenkopf&Petri,2019).Thisiscoherentwiththedifficultytocoordinatemultipleactorsaroundsharedgoals,aproblemthattheEUexperiencesbothin-ternallyandexternally.TheCarbonBorderAdjustmentMechanismTheCBAM(EC,2021b)isoneofthecli-matemeasuresincludedintheFitfor55strategy.TheproposedmechanismwouldClimateactionhasshiftedfrombeinganelementtomainstreamacrosspoliciestoonetoprioritise21AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegionimposeacostonimportofcarbon-inten-siveproducts,specifically–tostart–cement,aluminium,ironandsteel,fertiliserandelectricity.TheseindustrieswillbetaxedmoreheavilyfortheircarbonemissionsunderthereformedETS,and,intime,theywillnotbenefitfromfreeallowancesanymore.Instead,theywillbeprotectedbytheborderadjustmentmechanism.Previously,theregimeoffreeallowancesgaveEuropeancompaniesvulnerabletocarbonleakagefreecarbonallowancestoguaranteetheircompetitivenessintheglobalmarket.Carbonleakagereferstothesituationthatmayoccurifbusinessesfacingcostsduetostricterclimatepoliciesdecidetotransfertheirproductionelse-wheretocountrieswithlowerornocostsassociatedwithcarbonemissions.Italsoreferstotheswitchindemandofdomesticproductstocheaperimportedproductswhoselowerpricereflectstheabsenceofenvironmentalandclimatemeasuresinthecountryoforigin.VulnerabilitytocarbonleakageistheprincipalreasonbehindtheproposalofCBAM,ascarbonpricingintheEUisraised.CBAMisseenasanecessarymeasuredomesticallytogainsupportfortheGreenDeal.Atthesametime,itwillhaveanim-pactbeyondtheEU’sborder:intheSN,importsfromMorocco,AlgeriaandEgyptwillbeimpactedbythemeasure,mainlyinthefertilisermarket.4Furthermore,on-goingnegotiationsoftheCommission’sproposalamongtheEUinstitutionsdonotexcludethepossibilitytofurtherexpandCBAMtoadditionalsectorssuchasorganicchemicals,hydrogenandpolymers,whichwouldfurtherincreaseitsimpactonimports(Taylor,2022).Medi-terraneancountrieshavenotbeenvocalaboutCBAM,andofficialrequestsforconsultationonthisspecificmeasurehavenotbeenfiledtotheEUinstitutions.CritiquesagainstCBAMhaveinsteadbeenledbytheBASICcountries(Brazil,SouthAfrica,India,andChina).TheyfocusonthefactthattheCBAMisin-herentlyinviolationofthesystemofdif-ferentiatedresponsibilitiesthatunderpinstheUnitedNationsFrameworkConventiononClimateChange(UNFCCC).Moreover,expertsfearaWorldTradeOrganization(WTO)disputearoundCBAMwouldfurthershaketheglobaltradearchitecture,alreadyunderconsiderablestrain(Dadush,2021).TheEUseesCBAMasanecessarysteptodriveitsowndecarbonisationprocessdomestically.Itisalsothenaturalcon-sequenceofthesystemofdifferentiatedresponsibilities,astheasymmetryofcli-mateeffortsaroundtheworldpersists,withtheEUshowingalotmoreconcreteambitionthanmostofitsmaintradingpartners(ERCST,2021).CBAMisalsoseenasawayofencouragingotherpartiestotheParisAgreementtomovetothesamelevelofambitionsastheEU.ByadaptingtothesameEUnormstokeepaccesstothesinglemarket–theBrusselseffectinpractice–countrieswouldneedtospeeduptheirownde-carbonisationprocess.Forinstance,Tur-key’sclimateenvoydeclaredbeforeCOP26thattheprospectofanEUborderadjustmentmechanismhadinfluencedhiscountry’sdecisiontostepupitsclimateambitionsandjointheParisAgree-ment(Weise,2021).Inordertomakethemeasurenon-dis-criminatory,CBAMtargetsproductsfrom4ThefollowingdatadescribetradeflowswiththeSNinthesectorscoveredbyCBAM,inpercentageoftotalEUimports:fertilisers:Egypt(8.8%),Algeria(7.7%),Morocco(7.4%);electricity:Morocco(0.2%).Datasource:ERCST,2021.TheEUseesCBAMasanecessarysteptodriveitsowndecarbonisationprocessdomesticallyPolicyStudyn.23AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegion22individualproductionplants,notcountries;setsthepriceasthedifferencebetweentheEUcarbonpriceandthecarbonpricepaidintheproducingcountry–ifany;andappliestoallcountriesregardlessoftheirlevelofdevelopment,asitisnotintheinterestoftheEUnorpartnercountriestofostergrowthincarbon-intensivein-dustries(Chase&Pinkert,2021).ItisstilltobedecidedhowtheEUisgoingtoallo-caterevenuesfromCBAM.Tomakethemeasuremoredigestiblefortradingpartners,theEUcouldconsidersendingthemoneybacktothemtomaximiseinvestmentsinbettertechnologyanddisincentivesagainstpollutingbusinessmodels(Basagni&Chase,2021).Climatediplomacy,pairedwithgreenfi-nance,willbekeytomanagingthefutureoftradepatternsincarbon-intensivein-dustriesifasymmetriesofclimateeffortscontinuetoexist.TheEUshouldusedi-plomacytopreventthenarrativearoundCBAMfrombecomingoneofEuropeancountriesdumpingthecostsoftheirgreentransformationontodevelopingones.ThiswouldfeedconspiracytheoriesandpromotedisinformationagainstclimateactionandtheEUitself(Basagni&Chase,2021).Morocco,forinstance,hasbeenselectedbytheEUtointensifycooperationonclimateandenvironmentasaGreenPartner–undertheEUframeworkofGreenAl-liancesandPartnerships.5Jointworkaroundclimateandtradecouldbeincludedinthecooperationprogramme,andtechnicalas-sistanceandfinancialsupport(potentiallydrivenfromtheCBAMrevenues)channelledtoencourageconvergenceofdecarbon-isationefforts.Inthisregard,thedirectorofMorocco’sAgencyforEnergyEfficiencydeclaredinMayof2021theintentionofpreparingaMoroccanregulationrecognisedattheEuropeanleveltoevaluatethecarbonintensityofMoroccanproductionprocesses,andtheintentiontocollaboratewiththeEUtosetappropriatecriteria(Industries.ma,2021).Whilethisisjustadeclarationandadditionalinformationaboutfurtherdevel-opmentshavenotbeenfound,itsuggestsspaceforbilateralengagementaroundthechallengeofcarbonpricing.EnergyintheGreenTaxonomyTheEUGreenTaxonomy(Regulation[EU]2020/852)isanotherimportanttoolfortheimplementationoftheGreenDeal.TheTaxonomywillbeaclassificationofsus-tainableeconomicactivities.Bysustainable,theEUdefinesactivitiesthatcontributesubstantiallytoclimatemitigationandclimateadaptationandrespecttheprincipleofdo-no-harmtotheotherfourenviron-mentalobjectivessetbytheregulation:namely,thesustainableuseandprotectionofwaterandmarineresources;thetransitiontoacirculareconomy;pollutionpreventionandcontrol;andtheprotectionandresto-rationofbiodiversityandecosystems.TheseactivitieswillbegrantedagreenlabelbytheEUtoprovideasignaltothemarketthatindicateswhatconstitutesasustainableinvestment.TheEUtaxonomywillbethefirstattempttoassembleacomprehensiveclassificationofthiskind:itaimstoprovideatransparentandeasilyapplicabletooltodirectinvestmentstowardsdecarbonisationandchannelthenecessarypublicandprivatefinancingtotheGreenDeal.Itisexpectedtoprovideabenchmarkinthefieldofsustainableinvestmentglobally,thereforeinvestorsinsideandoutsideoftheEUarefollowingtheevolutionofthetaxonomyveryclosely.Energyisacontroversialchapterinthetaxonomy.On2February2022,theCom-missionapprovedinprincipleaComple-mentaryClimateDelegatedActincluding,5https://ec.europa.eu/international-partnerships/topics/green-deal_en23AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegionunderstrictconditions,specificnuclearandgasenergyactivitiesinthelistofecon-omicactivitiescoveredbytheEUtaxonomy(EC,2022).Nuclearenergyandgasarecurrentlyatthecoreofthedebateontheadoptionofanad-hoccomplementarydel-egatedact.GiventhenatureofenergytradeflowsintheMediterraneanregion,thischapterwilllimititselftothedebatearoundprovisionsconcerningnaturalgas.Thetaxonomydefinesthethresholdforsustainableenergyactivitiesat100gCO2e/kWhlifecycleemissions.Accordingtothesecriteria,naturalgasisnotgreen:mostexistinggasproductiontodaywouldevenfallabovethesignificantharmthresholdforclimatechangemitigation,whichhasbeensetat270gCO2e/kWh.However,theEUacknowledgesthatnaturalgaswillplayapivotalroleintheenergytransition,especiallythroughoutthenextdecade.Gaswillbeneededtophaseoutothermorepollutingfossilfuelsandsupporttheeconomy,whilerenewableenergysourcesarefurtherexpandedtoadequatelysatisfydemand.Europe’spro-gasmemberstatesinthesouthandeastareputtingpressureontheEUinstitutionstonotpenalisetech-nologiestheyconsidervitalinsecuringthetransitiontonet-zeroemissions(Khan&Fleming,2021).Atthesametime,non-governmentalorganizations(NGOs)andinvestorsalikearepressuringtheEUtomakesurethetaxonomysetsclearstan-dardsthatareevidence-basedandgroundedinscience(Ainger&Marsh,2021).Thedebateisstillopen,yettheCommissionhasoptedforincludinggasinthetaxonomyasatransitionalfuel“torecogniseandsupportthefinancingofcertaineconomicactivities[…]thatcon-tributetoreducinggreenhousegasemissionsinawaythatsupportsthetran-sitiontowardsclimateneutralitythroughoutthecurrentdecade”(EC,2021b).MovingbeyondthedebateonwhetherornotthiswastherightdecisioninbuildingtheEUtaxonomy,thefactthatgasisde-signedasaresourcewithalimitedtimespanintheEuropeanenergymixhashadimplicationsfortheMediterranean.Whilethetaxonomydoesnotcreateabanonin-vestinginfossilfuel,itreflectstheEU’sdesiretodivertcapitalfromfossilfuelstorenewables.Thatisultimatelythegoalofthetaxonomy:toprovideaclearsignaltothemarkettosupportastrategyofgreengrowth,suchastheGreenDeal,awayfromcarbon-intensiveeconomicactivities.Thetaxonomywillhaveextra-territorialreach,asanyoneofferingfinancialproductsintheEUwillneedtoabidebythedisclosureobligationsasperArticle8ofthetaxonomyregulation.Toencouragedialogueandpo-tentiallycoordinationaroundthedevel-opmentoftaxonomies,theEUhassetuptheInternationalPlatformonSustainableFinance(IPSF)inwhichMoroccohaspar-ticipatedsinceitslaunchin2019.Moreimportantly,though,thetaxonomyislikelytohaveinternationalinfluencebeyonditsextra-territorialreachanddespitetherebeingnoformalmechanismtobindthirdcountriestosharetheEUsustainabilitycriteria.Whileitdoesnotcreateabanoninvestinginfossilfuel,itreflectstheEU’sdesiretodivertcapitalfromfossilfuelstorenewables.Thatisultimatelythegoalofthetaxonomy:toprovideaclearsignaltothemarkettosupportastrategyofgreengrowth,suchastheGreenDeal,awayfromcarbon-intensiveeconomicactivities.IntheMediterranean,gasplaysanimportantroleintheenergymixandinregionalgeo-politics,withbothimportantconsumers(Egypt,Jordan,Italy,FranceandTurkey)andproducers(Algeria,EgyptandIsrael)presentintheregion.6Inthe2000sand2010sfielddiscoveriesintheEastern6Dataavailableathttp://www.medreg-regulators.org/Portals/_default/Skede/Allegati/Skeda4506-512-2021.2.23/MED20-30GA.pdf?IDUNI=4vd5nilby2kziyrysgccorwq9187PolicyStudyn.23AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegion24Mediterraneanhavemadegasmoreavail-able,andacombinationofeconomicfac-tors–favourableprices–andpoliticalfactors–lesscarbonemissionscomparedtooilandcoal–madeinvestmentsingaspalatable.Mediterraneangaswasstrategicallyseenasatooltodiversifyenergysupplytoincreaseenergysecurity,includingbytheEUvis-à-visRussiaandtheweaponisationofitsgassupplyintheconflictwithUkraine.Moreover,gashasbeenavenueforregionalintegrationwithmultipleinvestmentprojectsalreadyinthepipelineininterconnectionandstorage.7Yet,sofar,gashasfailedtoprovidetheavenueforcooperationthatmanypoliticiansandcommentatorshadhopedfor:gasdiscoverieshavebecomeasourceofdivisionthatoverlapswithexistingregionalconflictsinCyprus,Pa-lestineandLibya,ratherthananopportunityforcooperationandpeace-building(Ibish,2020).WithgasconsumptioninEuropesettosharplydeclineafter2030,andageneralrealisationthatgaswillonlyplayatransi-tionalroleinthedecarbonisationprocessasreflectedbythetaxonomydebate,thenewavenueforcooperationisplanningtheregion’sphaseoutoffossilfuels,in-cludinggas,inaccordancewiththerec-ommendationsofinternationalinstitutions.8Thedevelopmentofinfrastructurefortheproduction,storageandtransportofre-newableenergyforconsumptionintheregionandtowardsEurope,aswellasinvestmentstomakepipelinesfittore-convertforfuturetransportationofgreenhydrogen,9willbekeyavenuesforcoop-erationintheMediterranean,makingtheGreenDealanhistoricopportunityforcooperationintheregion(Grigoriadis&Levoyannis,2021).Bilateralcooperationintheenergyfieldwilladvanceatdifferentspeedsaccordingtoeachpartner’spriorities.Someexamplesfollow:•IncountrieslikeJordanandMorocco,wheretheprocessofcooperationanddialoguewiththeEUaroundrenewableenergydevelopmentstartedaslongas10yearsago,thepartnershipcanbemoreambitious.MoroccowaschosenasoneoftheEU’s“greenpartners”anddelegationstaffreportsthattheGreenDealhashadasubstantialimpactontheprogrammingforfinancialandtechnicalcooperationoverthenext7years.•EnergyinsecurityiscurrentlyhighinLe-banon,andtheenergysectorpresentschallengesbothintermsoftransparencyandefficiency.Technicalcooperationtoimprovemarketpracticeswasidentifiedasanecessaryfirststepbeforetacklingtheenergytransition.•Algeriacurrentlyprovides8%ofEUgasimports,andbilateralcooperationonenergyisstrong.Asub-committeeonenvironment,energyandtransportcon-venesonceayear;inaddition,aplatform7AdetailedmapofgasinfrastructureintheMediterraneanisavailablefromtheMED17-24GA-5.4.2FINALREPORT,availableonline:http://www.medreg-regulators.org/Portals/_default/Skede/Allegati/Skeda4506-254-2018.4.27/MEDREG_Gas_Infrastructure_Map_April_2018.pdf?IDUNI=fm2sq3k2hhieekm4ygbkl10u52728Researchonnet-zeroby2050pathwaysfortheenergysector,includingtherecentIEAWorldEnergyOutlook,stressesthatthereisnoremainingcarbonbudgetfornewgasinvestmentsandthatexistinggas-firedpowerplantswillhavetobephasedoutby2035intheOrganisationforEconomicCo-operationandDevelopment(OECD)and2040globally.9TheEUHydrogenStrategyreferstotheobjectiveofdeveloping2×40GWofrenewablehydrogenby2030:40GWinEuropeand40GWinUkraineandNorthernAfrica.Bilateralcooperationintheenergyfieldwilladvanceatdifferentspeedsaccordingtoeachpartner’spriorities25AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegionfordialoguewasestablishedin2015toallowforfrequentexchangeanddeepercooperationonenergy.AlgeriashowsinterestinstreamliningitsownregulationandpracticeswiththoseoftheEU:technicalcooperationisfocusingonin-creasingenergyefficiency;developingrenewableenergysources(solarandwindpower);theproductionofhydrogen;andpreparingforafutureindependentofnaturalgasproduction.ConclusionsTheEUhasastrong,externalenviron-mentalimpactduetoitsmarketsizeandcomplexity,andthehighdegreeofinter-dependencewithothereconomies.Inthepast,unsustainablemarketpractices,butalsopoliciesinherentlyatoddswithenvironmentalgoals,contributedtopol-lutionandclimatechangeglobally.TheGreenDealsetouttoreversethispatternandturnEuropeintothefirstclimateneutralcontinent.FortheGreenDealtobesuccessfulindrivingthegreentransitiondomesticallyandglobally,policycoherenceneedstobepursuedbystreamliningin-ternalandexternalpolicydecisionswithclimateambitions.Climateactionisall-encompassingacrosspoliciesandsectors.Therefore,climatediplomacyshouldbe-comethecornerstoneofEUexternalpolicyinthisdecade.Despiteitsrecentadoption,thisresearchshowsthattheGreenDealisalreadyplayingakeyroleinshapingtheEU’sre-lationswiththirdcountries,includingtheagendaforcooperationintheMediterra-neanregion.ThecooperationprogrammesetoutforthenextsevenyearsunderthenewframeworkoftheEuropeanNeigh-bourhoodPolicy(ENP)SouthreflectstheprioritisationofclimateactioninEuro-peanpolitics,bothintermsofthematicprioritiesandallocationoffinances.More-over,policieslikeCBAMandtheGreenTaxonomywillhaveanimpactonpartnercountriesintheMediterranean.TheEUshouldnotloweritsambitionstodecar-boniseitseconomyduetothesystemofdifferentiatedresponsibilities.Instead,theexternalimpactofitsdecision-makingshouldbecarefullymonitored,andequityrestoredinclimateactionthroughdiplomaticeffortsandtechnicalandfinancialassistance,leadingtowin-winoutcomes.TheEUhasalreadyovercometheconflictbetweenclimateandgrowth-orientedpol-iciesbyframingthegreentransitionasaneconomicopportunity,andtheGreenDealitselfasastrategyforgrowth.NextstepsshouldmakesurethatthesystemsandstructuresthatimplementtheGreenDealdonotalienatepartnercountries,whilepushingthemtoraisetheirclimateambitions.Climatefinancewillbethecrucialnextstep.CBAMisacaseinpointandcarefuldeliberationisneededtodecidehowtoallocaterevenuesinawaythatisgroundedinclimatejustice.Meetingclimatefinancepledgesalsoremainsaprioritytomanagedecarbonisationinthecontextofrelationsbetweendevelopedanddevelopingcoun-tries.Finally,theroleofEUDelegationsincli-matediplomacyispowerful.Theyareakeyresourceinenablingpolicylearningandfeedbackloopsandfacilitatingco-operationatbothbilateralandregionallevels.MakingsurethatDelegationsareequippedwithadequateexpertiseandresourcesandfunctioningchannelsofcooperationwithBrussels-basedinstitu-tionsandwitheachothershouldbecon-sideredapriorityindevelopingtheexternaldimensionoftheEUGreenDeal.PolicyStudyn.23AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegion26ReferencesAINGER,M.,&MARSH,A.(2021,November8).Net-ZeroAlliancePlanstoRejectGas,Nuclear,asGreenAssets.Bloomberg.Retrievedfromhttps://www.bloomberg.com/news/articles/2021-11-08/net-zero-alliance-plans-to-reject-gas-nuclear-as-green-as-setsBASAGNI,L.,&CHASE,P.(2021,November8).TheunresolvedtradeproblemofParis—andhowGlasgowcanhelp.TheGermanMarshallFunoftheUnitedStates(GMFUS).Retrievedfromhttps://www.gmfus.org/news/unresolved-trade-problem-paris-and-how-glasgow-can-helpBIEDENKOPF,K.,&GROAN,L.(2021).ExternalEUenvironmentalpolicy.InA.Jor-danandV.Gravey(Eds.),EnvironmentalPolicyintheEU.Actors,InstitutionsandProcesses.Routledge.BIEDENKOPF,K.,&PETRI,F.(2019).EUDelegationsinEuropeanUnionclimatedi-plomacy:theroleoflinkstoBrussels,individualsandcountrycontexts.JournalofEuropeanIntegration,41(1),47-63.Retrievedfromhttps://www.tandfonline.com/doi/full/10.1080/07036337.2018.1551389?scroll=top&needAccess=trueBIEDENKOPF,K.,&PETRI,F.(2021).TheEuropeanExternalActionServiceandEUclimatediplomacy:CoordinatorandsupporterinBrusselsandbeyond.EuropeanFor-eignAffairsReview26(1),71–86.BRADFORD,A.(2020).TheBrusselseffect:HowtheEuropeanUnionrulestheworld.OxfordUniversityPress.CHASE,P.,&PINKERT,R.(2021,September).TheEU’striangulardilemmaoncli-mateandtrade.TheGermanMarshallFundoftheUnitedStates(GMFUS).Retrievedfromhttps://www.gmfus.org/news/eus-triangular-dilemma-climate-and-tradeCOUNCILOFTHEEUROPEANUNION(CounciloftheEU).(2018).Outcomeofproceedings6125/18.Councilconclusionsonclimatediplomacy.Retrievedfromhttps://www.consilium.europa.eu/media/32953/st06125-en18.pdfDADUSH,U.(2021).TheEU’sCarbonBorderTaxisLikelytodoMoreHarmthanGood.ThePolicyCenterfortheNewSouth(PCNS).Retrievedfromhttps://www.policy-center.ma/publications/eu%E2%80%99s-carbon-border-tax-likely-do-more-harm-goodEUROPEANCOMMISSION(EC).(2019).Communication2019/640,TheEuro-peanGreenDeal.Retrievedfromhttps://eur-lex.europa.eu/resource.html?uri=cellar:b828d165-1c22-11ea-8c1f-01aa75ed71a1.0002.02/DOC_1&format=PDF.EUROPEANCOMMISSION(EC).(2021a).Carbonleakage.Retrievedfromhttps://ec.europa.eu/clima/eu-action/eu-emissions-trading-system-eu-ets/free-alloca-tion/carbon-leakage_en27AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegionEUROPEANCOMMISSION(EC).(2021b).Communication2021/550,‘Fitfor55’:deliveringtheEU’s2030ClimateTargetonthewaytoclimateneutrality.Re-trievedfromhttps://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:52021DC0550&from=ENEUROPEANCOMMISSION(EC).(2022).TaxonomyClimateDelegatedAct.Re-trievedfromhttps://ec.europa.eu/finance/docs/level-2-measures/taxonomy-regulation-delegated-act-2022-631_en.pdfEUROPEANINVESTMENTBANK(EIB).(2019,November14).EUBanklaunchesambitiousnewclimatestrategyandenergylendingpolicy.Retrievedfromhttps://www.eib.org/en/press/all/2019-313-eu-bank-launches-ambitious-new-climate-strategy-and-energy-lending-policyGOLDMAN,E.,WEISSE,M.,HARRIS,N.,&SCHNEIDER,M.(2020,November12).Estimatingtheroleofsevencommoditiesinagriculture-linkeddeforestation:Oilpalm,soy,cattle,woodfiber,cocoa,coffee,andrubber.WorldResourcesInsti-tute.Retrievedfromhttps://www.wri.org/research/estimating-role-seven-commodities-agriculture-linked-deforestation-oil-palm-soy-cattle.GRIGORIADIS,I.N.,&LEVOYANNIS,C.(2021).WindsofchangeintheEasternMediterranean:Betweenhydrocarbonsandrenewableenergygeopolitics.HellenicFoundationforEuropeanandForeignPolicy(ELIAMEP).IBISH,H.(2020).CompetitionforMediterraneannaturalgasdeepensasGulf,Europeanstatesjointhefray.TheArabGulfStatesInstituteinWashington.Retrievedfromhttps://agsiw.org/competition-for-mediterranean-natural-gas-deepens-as-gulf-european-states-join-the-fray/EUROPEANCOMMISSION(EC)&EuropeanExternalActionService(EEAS).(2021).JointCommunication,RenewedpartnershipwiththeSouthernNeighbour-hood.ANewAgendafortheMediterranean.Retrievedfromhttps://eeas.europa.eu/sites/default/files/joint_communication_renewed_partnership_southern_neighbour-hood.pdfKHAN,M.,&FLEMING,S.(2021,October20).Brusselstodelaydecisiononhowtoclassifynuclearpowerforgreenfinance.TheFinancialTimes.Retrievedfromhttps://www.ft.com/content/898e6c53-8e85-4cfc-b00b-16a09d50b462Lataxecarbone,unatoutpourlesentreprisesmarocainespourréussirleurtransitionversl’économieverte.(2021,May4).INDUSTRIES.ma.Retrievedfromhttps://indus-tries.ma/la-taxe-carbone-un-atout-pour-les-entreprises-marocaines-pour-reussir-leur-transition-vers-leconomie-verte/.MEDITERRANEANEXPERTSONCLIMATEANDENVIRONMENTALCHANGE(MedECC).(2020).ClimateandenvironmentalchangeintheMediterraneanBasin–Currentsituationandrisksforthefuture.FirstMediterraneanassessmentreport.PolicyStudyn.23AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegion28RITCHIE,H.(2019,October1).WhohascontributedmosttoglobalCO2emissions?.OurWorldinData.Retrievedfromhttps://ourworldindata.org/con-tributed-most-global-co2ROUNDTABLEONCLIMATECHANGEANDSUSTAINABLETRANSITION(ERCST).(2021).BorderCarbonAdjustmentsintheEU.Sectoraldeepdive.Re-trievedfromhttps://ercst.org/wp-content/uploads/2021/03/20210317-CBAM-II_Re-port-I-Sectors.pdfTAGLIAPIETRA,S.(2021,December7).TheGlobalGateway:arealsteptowardsastrongerEuropeintheworld?.Bruegel.Retrievedfromhttps://www.bruegel.org/2021/12/the-global-gateway-a-real-step-towards-a-stronger-europe-in-the-world/TAYLOR,K.(2022,January12).Lawmakerdrafts‘completeoverhaul’ofEUcarbonborderlevy.EURACTIV.Retrievedfromhttps://www.euractiv.com/section/energy-en-vironment/news/eu-lawmaker-drafts-complete-overhaul-of-carbon-border-levy/ULGEN,S.(2021,October6).HowdeepistheNorth-Southdivideonclimatene-gotiations?.CarnegieEurope.Retrievedfromhttps://carnegieeurope.eu/2021/10/06/how-deep-is-north-south-divide-on-climate-negotiations-pub-85493UNITEDNATIONSFRAMEWORKCONVENTIONONCLIMATECHANGE(UNFCCC).(2015).ReportoftheConferenceofthePartiesonitstwenty-firstsession,heldinParisfrom30Novemberto13December2015.Retrievedfromhttps://unfccc.int/process/conferences/pastconferences/paris-climate-change-con-ference-november-2015/paris-agreementWEISE,Z.(2021,November6).EU’sloomingcarbontaxnudgedTurkeytowardParisclimateaccord,envoysays.POLITICO.Retrievedfromhttps://www.politico.eu/ar-ticle/eu-carbon-border-adjustment-mechanism-turkey-paris-accord-climate-change/.AFrameworkofWater-EnergyInterdependenceAmongRegionalActors:ANecessaryStepTowardaSuccessfulGreenTransitionintheMiddleEastandfortheEU'sClimateSecurityBeyonditsBordersTizianadellaRagioneResearchAssociateattheInstituteforNationalSecurityStudies(INSS)andResearcherattheMosheDayanCentre(MDC),TelAvivUniversity31AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegionIntroductionIntheMiddleEast,populationgrowthandclimatechangechallengesareincreasingwaterandenergydemand,puttingfurtherstrainonwaterandenergysystemsaswellasaccesstonaturalresources.Asuccessfulgreentransitioninthisregioncallsforabettercoordinationofsectoralpoliciesandenhancedregionalcooperationinthefieldsofenergy,waterandsustain-ability.Forseveralyearsnow,EcoPeaceMiddleEast,auniquetransnationalorganisationthatbringstogetherJordanian,PalestinianandIsraelienvironmentalists,hasbeenpro-motingaregionalwater-energynexustoaddresstheclimatecrisisandmanageitsgeopoliticalrepercussions.Intheir2020reportentitled“TheGreenBlueDealfortheMiddleEast”,theorganisationindeedproposedaframeworkofinterdependenciesintheMiddleEasttoutiliseclimatechangeasanopportunityforcreatingcooperationintheregion.Inparticular,thereportoutlinestheeconomic,technicalandgeopoliticalbenefitsofusingJordaniansolar-basedenergyandIsraeliandPalestiniandesali-natedseawater,offeringasolutiontomitigatethegrowingimpactofclimatechangeanditsregionalandnationalsecurityconsequences.On22November2021,thesigningoftheDeclarationofIntentbetweentheHa-shemiteKingdomofJordan,theStateofIsraelandtheUnitedArabEmiratesmarkedthebeginningofanewchapterintheMiddleEastregion,wherepoliticalgoodwillamongtherelevantactorscouldpavethewayfortheexpansionofexistingregionalcooperationonwater-andenergy-relatedinitiativeswithclimateandsecurityadvantages.However,theabsenceofthePalestiniansisregrettable.TheEuropeanUnion(EU)shouldsupportinitiatives,liketheoneproposedbyEco-PeaceMiddleEastforregionalintegrationonclimateandwaterissuesintheregion,tomeetitsambitiousgoalofexternalisingtheEuropeanGreenDealbeyonditsborders.Theframeworkofinterdepen-denciesonwaterandenergymattersamongregionalactorsintheMiddleEastcouldbeapoliticalgamechangerforEUclimatesecurityinthisregion.Yet,thepoliticalwillingnessoftheregionalactorsinvolvedisaconditiosinequanonforanycross-borderinitiativetoeffectivelymaterialise.Inthiscontext,thepresentstudyfocusesontheanalysisofthecurrentpoliticalsituationregardingregionalcoop-erationonenergyandwaterissues.Semi-structuredinterviewsconductedremotelyorinpersonwhenpossible,complementthedeskfieldresearch.10Understandingthewillingnessoftheregionalactorstoes-tablishatransboundarywater-renewablesnexuswillenableEUpolicy-makerstoreachinformeddecisionsonhowtobetterarticulatebilateralandregionalapproachesintheMiddleEasttoguaranteetheexternalisationoftheEUGreenDealinthisregion.TheclimatecrisisinJordan,IsraelandPalestineandtherelativeadvantagesofeachcountryinthesolarenergyandwatersector10Publicdeclarationsbyregionalrelevantstakeholders,newspaperpublications,thinktankanalysisaswellasin-personinterviewshavebeenusedtofindthepoliticalwilltostrengthenregionalcooperationonwaterandenergymatters.Furthermore,EUdelegatesinTel-Aviv,AmmanandEastJerusalemwerealsocontactedtocapturehowEUDelegationsaresupportingregionalactorstoaddresstheclimatecrisisandmovetowardasuccessfulgreentransition.PolicyStudyn.23AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegion32AsuccessfulgreentransitionintheMiddleEastisexpectedtobechallenging.WaterandenergyinsecurityareextremelyprevalentthroughouttheMiddleEastandhavealreadyfuelledsomeofthelong-runningconflictsintheregion.Thedemographicgrowthandtheclimatecrisisareexpectedtoworsenthecurrentsituation(UN,2020),11puttingfurtherstrainonwaterandenergydemandaswellasnaturalresourcesaccess.Indeed,theEasternMediterraneanwarmsupmoreseverelythananywhereelseintheworldandhasalreadyexperienceda2°Celsiusincreaseintemperaturesince1990(1.5°Celsiusintherestoftheworld);bytheendofthe21stcenturyafurther4°Celsiusriseintemperatureisexpected(Hochmanetal.,2018).Furthermore,underthecurrentconditions,thelengthofthesummerseasonispredictedtoincreaseby25%inthemid-21stcenturyandby49%attheendofthecenturywithaconcomitantsignificantde-creaseofrainfallmakingmanyareasinhos-pitableanduninhabitableandfuellingcon-flicts(Hochmanetal.,2018).Jordan,IsraelandPalestineareworkingonclimate-resilientstrategiesforwaterandrenewableenergyinordertomovetowardmoresustainabledevelopmentatthena-tionallevel.Jordan,forinstance,aimsatexploitingitsenormoussolarenergypotential(Alrwashdehetal.,2018)12tocopewithenvironmentalchallengesanditssignificanttradedeficit(dellaRagione,2021a).Inthisrespect,theHashemiteKingdomofJordancommittedtofullydevelopitsre-newableenergysector,planningtogen-erate50%ofelectricityfromrenewablesby2030.13Theexpansionofthissector,whichisalreadyattractinginternationalinvestmentsfromfinancialinstitutionssuchastheEuropeanBankforRecon-structionandDevelopment(EBRD)14andtheEuropeanInvestmentBank(EIB),15couldallowJordantobecomethesolar-basedelectricityhubfortheregion,supp-lyingcleanenergytoitsneighbourhoods,suchasIsraelandPalestine.Yet,thede-velopmentoftherenewable-basedenergysectorwillnotbeenoughtosolveJordan’swatercrisis.AccordingtoUnitedNationsChildren’sFund(UNICEF),Jordaniscon-sideredthesecondmostwaterscarcecountryintheworldintermsofpercapitaavailabilityofrenewablewaterresources,16andclimatechangewillleadtomorewatershortages.Infact,duetothesideeffectsofclimatechange,whiletreatedwastewaterremainstooexpensive,surfacewaterisdecliningandgroundwaterextrac-tionwillsoonbecomeunsustainable.Jor-daniancommunitiessufferfromwatershortages17andareforcedtobuywaterfromprivatetankersatveryhighprices,leadingtoaneconomicdisparityinwater11Globalwaterusehasincreasedbyafactorofsixoverthepast100yearsandcontinuestogrowsteadilyatarateofabout1%peryear.12Jordanlieswithinthesolarbeltoftheworld,withaveragesolarradiationbetween4and8KWh/m2,whichimpliesapotentialof1400-2300GWhperyear(Alrwashdehetal.,2018).13Jordantargets50%ofrenewablesinpowermixby2030(Enerdata,2021).14SofaroverUSD350millionforatotalof392MWofutility-scalewindandsolarprojectsinthecountry.SeeEBRD’swebsitehttps://www.ebrd.com/work-with-us/project-finance/project-summary-documents.html?1=1&filterCountry=Jordan15“CVDB-MunicipalEnergyEfficiencyProgramme”,JordanEIBsupportedproject,23May2019.SeeEIB’swebsitehttps://www.eib.org/en/projects/pipelines/all/2018061516https://www.aljazeera.com/news/2021/11/2/experts-warn-of-catastrophe-facing-jordans-water-sector17Jordaniansreceivetheirwatersupplyfromthegovernmentanythingfromtwiceaweektoonceeverytwoweeks,withthewaterbeingstoredintanksonroofsoringaragesforuseuntilthenextdelivery.https://www.aljazeera.com/news/2021/11/2/experts-warn-of-catastrophe-facing-jordans-water-sectorTheEasternMediterraneanwarmsupmoreseverelythananywhereelseintheworld33AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegionaccess.18Inaddition,whileJordanisplan-ningtodesalinatemoreseawaterinAqaba(ArabNews,2021),thecostofpumpinganddistributionofwatertothemorepopu-latedAmmanregionwouldstillbeveryhighduetoitsgeographicremotenessandtheheightdifferencebetweenthetworegions.However,asOmarSalameh,theofficialspokesmanoftheMinistryofWaterandIrrigationclarified,thenationalwatercarrierisonlyplannedfor2027anditsmaterialisationisnecessarytotransportdesalinatedwaterfromtheRedSeatothecountry’sorates.Finally,thewatertradebetweenJordanandIsrael,whichhasre-centlybeenincreased,19isstillinsufficienttomitigatetheJordanianwaterdeficitand,mostimportantly,createsdependencyfromJordantoIsraelratherthaninterdependencybetweenthetwoparties.Theexpectedin-creaseinpopulationgrowthislikelytoex-acerbatethewatercrisisinthecountry.Palestinesuffersfrombothwaterscarcityandenergyinsecurity.Withregardtowater(Avirametal.,2020),itsdistributionfromIsraelisgovernedbyArticle40onWaterofthe1995OsloIIAgreement(GovernmentofIsrael&PLO,1995).However,thewatersupplyformanyPalestiniancommunitiesintheWestBankandGazaisstillinsufficient.Thelatterstillsufferfromintermittentwatersupplyandstilldependonwatertankers,especiallyinthehotsummerseasons.AndinGazathewatercrisishasbecomeahu-manitarianemergencysince97%oftheaquifersarenotsuitableforhumancon-sumptionanymore(UNOCHA,2016).Thedevelopmentofawater-seadesalinationplanintheGazaStripcouldmitigatethewateremergency,butitsdevelopmentisaffectedbypoliticalconstraintswithIsraelandbythefactthatthePalestinianleader-shipremainsdeeplydivided.20Israelhascommittedtoanunconditionalabsolutegreenhousegas(GHG)emissionsreductiongoalof27%for2030(relativeto2015),21which,translatedinitsIntendedNationallyDeterminedContribution(INDC),accountsforareductionofGHGemissionto58MtCO2bythesameyear.22Still,in2020,theproductionofelectricityfromre-newableenergy(mainlysolarphotovoltaic)amountedtoonly6.1%(Surkes,2021),andincreasingthispercentagemayinvolvesomechallenges.First,Israelhasnoaccesstoanumberofwidelyusedlow-carbonsourcesofenergysuchasnuclear,hydro-electricandgeothermalpower.Second,thecountryhasalimitedareaavailableforlarge-scaleenergyinstallationswhichiseconomicallycounterproductive(JewishNewsSyndicate,2021).Indeed,theNegev,whichlookslikeavastdesertarea,isactuallyunavailablefortheinstallationoflargescalesolarplants,duetothefactthathalfofitisamilitarytraininggroundwhiletheotherhalfisdeclaredanaturalreserve.Last,butnotleast,theamountof18Middle-wageworkersinterviewedinAqabainDecember2021claimedthatabout20%oftheirwagesarewastedbybuyingwaterfromprivates,asthewaterprovidedbythegovernmentonlyonceaweekforafewhoursisinsufficientfortheirneeds.19InJuly2021,IsraelandJordanagreedthenthatIsraelwouldsell50millioncubicmetresofwaterayeartoJordan,doublingwhatitalreadysupplies.On12October2021,Israel’sMinisterofEnergy,KarineElharrar,andJordanianMinisterofWaterandIrrigation,MohammedAl-Najjar,metinJordanforthesigningofthewateragreementfortheJointWaterCommittee.Thedealcomesasanextensionofthetwocountries’existingwateragreement,whichwasestablishedaspartofthe1994Israel-Jordanpeacetreaty.20ThemilitantgroupHamas,ratherthanthePalestinianAuthority,controlsGaza,affectingtheconstructionofadesalinationplantintheGazaStrip.21Decision171entitled“TransitiontoaLowCarbonEconomy”,passedbytheIsraelGovernmenton25July2021.22UpdateofIsrael’sNationallyDeterminedContributionundertheParisAgreementsubmittedJuly2021,UNFCCC.PolicyStudyn.23AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegion34landrequiredtoenjoythedesiredeconomiesofscalestillseemsdisproportionate;notonlywouldtheproductionofasinglecubicmetreofwater(1000L)perdayrequireanareaofupto28m2(Shahzad,2017)butevenifenergyefficiencyweretoincreasefurther,thepriceofIsraelicoastallandisstillsohighthatitisnoteconomicallyviabletoinstallsolarpanels.23Asfaraswaterdemandisconcerned,therapiddevelopmentofthedesalinationsectorduringthelastdecadeshasenabledIsraeltoovercomeitswatershortageandtobecomebyfartheworldleaderinwaste-waterreclamation(about93%ofIsrael’swastewaterispurified).Israelhasasignifi-cantcapacitytoproducedesalinatedwaterfromtheMediterraneanSeaandwithitsfiveprincipaldesalinationplants–SorekA,Hadera,Ashkelon,Palmachim,andAsh-dod–plusapproximately30smallerplants,producesmorethan700millioncubicmetresofdesalinatedwaterperyear(702millionm3/year).Asixthdesalinationplant,theSorekBfacility,iscurrentlyundercon-structionandwillsupplyanestimatedad-ditional227millionm3/year,bringingthedesalinatedwaterupto85-90%oftheIs-raeliannualconsumption(dellaRagione,2021a).However,theexpansionofitsde-salinationsector,whichispoweredbyelectricitygeneratedmainlyfromnaturalgas,raisesquestionsaboutitsenvironmentalsustainability(dellaRagione,2021a).ThecarbonfootprintofacubicmetreofwaterproducedbythecurrentIsraeliseawaterreverseosmosisdesalinationplantsises-timatedbetween1.4and1.8kgofCO2.Inaddition,Israeldesalinationalreadyac-countsforabout5%oftheenergyde-mand,24andthelatterisexpectedtogrowrapidlyinresponsetothecountry’spopu-lationgrowthattherateof2%peryearandtheincreasingstandardsofliving(Tal,2018).WhiletheexpansionofIsrael’sde-salinationinfrastructuresmaybecomenecessarytomeetincreasingnationalwaterdemand,itsenvironmentalsustainabilityrequirestheintegrationofrenewablesinsupplyingtheelectricityofdesalinationplants.Water-energynexusbetweenJordan-IsraelandPalestineInterdependencyforregionalstabilityandsustainablegreentransitionAtCOP26inNovember2021,EcoPeaceMiddleEastpresentedtheir“TheGreenBlueDealfortheMiddleEast”(Brombergetal.,2020).MeetingwithsomeEUdel-egates,GidonBromberg,thenon-govern-mentalorganization(NGO)’sIsraelCo-Di-rector,highlightedhowaframeworkofin-terdependencebetweenPalestine,JordanandIsrael,whichusesclimatechangeasanopportunitytoestablishcooperationonstrategicsectorssuchaswaterandenergy,cannotonlycontributetosustainablede-velopmentforregionalactorsbutcanimprovetheprospectsforpeaceandsecuritythrough-outtheregion(OfficialsoftheEUDelegationtoIsrael,personalcommunication,November2021).AsexplainedbyEcoPeaceMiddleEast,theregionalwater-energynexuswillbenefitallpartnersinvolved.JordancouldobtainadditionaldesalinatedwaterfromIsrael,mitigatingitswatercrisis,andcouldbecometheregionalhubforrenewableenergyproduction,thelatterreducingitsdependencyonIsrael’sgas.PalestinecouldgetrenewableenergyfromJordan,diversifyingitsenergysources,andcouldbenefitwithextraamountsofwaterinboththeWestBankandGazaStrip,whileallowingGaza23Itwouldtake64millionsolarpanelsforIsraeltoreach30%renewablecapacity.24IsraelElectricCompany.Availableonline:http://www.globes.co.il/news/article.aspx?did=1001121812.Asfaraswaterdemandisconcerned,therapiddevelopmentofthedesalinationsectorduringthelastdecadeshasenabledIsraeltoovercomeitswatershortage35AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegiondesalinatedseawatertobeexchangedforJordaniansolar-basedenergy.Thisarrange-mentwilldecreasePalestine’sdependenceonIsraelandincreaseitsintegrationintheArabWorld.ForIsrael,thewater-renewableenergyarrangementcouldallowthecountrytodiversifyitsenergysectorandtopro-gressivelydecarboniseatarelativelycheaperprice,asIsraeldoesnothavethelandformassproductionofrenewableenergy.Lastbutnotleast,theplanservestheinterestoftheregion’slong-termecologicalviability(G.Bromberg,personalcommunication,November2021).EcoPeaceMiddleEastiscertainlycorrectinadvocatingaregionalapproachtoclimatechangechallengeswhoseenvironmentalconsequencesandgeopoliticalreper-cussionsareregionalinscope.Indeed,toensureasmoothgreentransitionintheMiddleEast,nationalclimateresiliencestrategiesneedtobecomplementedbyregionalinitiatives,leveragingthecom-parativeadvantagesofeachstakeholderandcreatinginterdependencyamongthem.On22November2021,Jordan,IsraelandtheUnitedArabEmirates(UAE)signedadeclarationofintenttosupplyJordanianrenewableenergytoIsraelinexchangefordesalinatedwaterfromthelatter.Theagree-mentsignedisagoodexampleofareneweddialoguebetweenthepoliticalleadershipinJordanandIsrael,aresultmostlikelymadepossiblebythepoliticalchangesthathaveoccurredintheregionsincethenormalisationofIsrael’stieswithtwoGulfstates,BahrainandtheUAE,andtheemergenceofthenewIsraeligovern-ment(dellaRagione&Eran,2021).Indeed,onseveraloccasionsinrecentmonths,thenewIsraeligovernmenthaspubliclyacknowledgeditsneedtoincreaseitsrenewableshareoftheenergymixinordertorespondeffectivelytotheclimatecrisis,identifyingJordan’spurchaseofre-newableenergyasonestrategytoachievethisgoal.25Inaddition,thenewIsraeligov-ernmentseemstounderstandthatcross-borderwater-energycooperationwithJordancouldcontributetoregionalstabilitywhileavoidingthegeopoliticalrepercussionsofclimatechange(OfficialsoftheIsraelMinistryofEnergyandMinistryofEnviron-ment,personalcommunication,December2021).InameetingwiththeEUDelegationtoIsrael,theMinisterofEnvironmentalPro-tection,Ms.TamarZandberg,appreciatedtheEUDelegation’sinitiativetopromotethecooperationbetweenIsraelanditsneighbouringcountriesonenvironmental,energyandwatermatters,highlightingtheinterestoftheentireregion.Furthermore,sheemphasisedtheimportanceofachievingmoreambitiousgoalsonrenewableenergiesthroughaclosercooperationwithJordanondesalinatedseawaterandsolarenergy(OfficialsoftheEUDelegationtoIsrael,personalcommunication,October2021).AsforJordan,improvingrelationswithIs-rael’snewgovernment,afteryearsofstrainedrelationsunderNetanyahu,hadalreadybeenillustratedbythewateragree-mentsignedon12October2021.26Thelatterwastheresultofnegotiationsand25PublicstatementshighlightingtheimportanceofIsrael-JordantiesandtheircooperationonenergyandwaterweremadebyIsraeliGovernmentinthelastmonths:FordeclarationsmadebytheIsraeliMinisterofEnergyKarineElharrar,seeBassist(2021).FordeclarationsmadebytheIsraelForeignMinistryYairLapid,seeTapzitNewsAgency(2021)andSpiro&Boxerman(2021).26IsraelandJordanagreedonaplanforIsraeltodoublethequantityoffreshwateritprovidestoJordan,Accordingtothisagreement,signedbytheEnergyMinisterKarineElharrarandhercounterpart,theJordanianMinisterofWaterandIrrigationMohammedAl-Najjar,IsraelwillprovideJordanwithadditional50millioncubicmetresofwaterfor2021,withanoptiontocontinuesimilarlyforthenexttwoyears.ThenewIsraeligovernmenthaspubliclyacknowledgeditsneedtoincreaseitsrenewableshareoftheenergymixPolicyStudyn.23AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegion36meetingsbetweenthetwopartiesthatbeganasearlyasJuly2021,althoughtheseeventsweremainlypublicisedbytheIsraeliside,atleastintermsofpublicdeclarationsbyitsleadershipandnationalpresscoverage.27ThelessoutspokeneventsbyJordan’smediaandleadership,however,shouldnotbereadasadiminishedinterestinachievingcooperationwithIsraelonwaterandenergymatters.Thecurrentdevelopmentisratherinlinewiththedeci-sion-makingprocessinJordan,whichisverytop-downandpalace-driven.TheJor-danianleadershipiscertainlykeentoad-dressitswatercrisisthroughthepurchaseofIsraelidesalinatedwaterandtosupplyitsownrenewableenergy.Negotiationsbetweenthepartiesandtheprivatesectors,whichhavealreadybeentakingplaceforseveralmonths,doindeedreflectthewill-ingnessfrombothsidestomaterialisetheagreementwithinarelativelyshorttimeframe(G.Bromberg,personalcommunication,November2021).ThedeclarationofintentbetweentheHashemiteKingdomofJordan,theStateofIsraelandtheUAEmarksthebeginningofanewchapterintheMiddleEastregion,wherepoliticalgoodwillamongtherelevantactorscouldpavethewayfortheexpansionofexistingregionalco-operationonwaterandenergy-relatedinitiativeswithclimateandsecurityad-vantages.However,theabsenceofthePalestiniansremainsregrettable.TheshortdistancesbetweenthepossibleroutesofthesolarpowergridfromJordantoIsraelandthewaterconveyorfromtheMediterraneantoJordanandtotheWestBankmaketheconnectionrelativelysimpleandinexpensive.TheinclusionofPalestineintheregionaldealcouldmitigatetheenergyandwaterinsecurityofthelatter,advancingonaverycomplexIsraeli-Pa-lestinianconflictwaitingtoberesolvedandcontributingtothegreentransitionintheentireMiddleEastregion(dellaRagione&Eran,2021).WheredoestheEuropeanUnionstandonregionalcooperationbetweenIsrael,JordanandPalestineonenergyandwatermatters?ThemediationoftheUnitedStates(USA)intheregionalagreement,signedbetweentheHashemiteKingdomofJordan,theStateofIsraelandtheUAE,seemstosuggestthattheinvolvementoftheinter-nationalcommunityisstillveryrelevantinadvancingsimilarpartnershipsbetweenactorswho,otherwise,wouldbeunlikelytocooperate(dellaRagione,2021b).TheEUhasnotyetfullyseizedtheop-portunityofthisregionalopeningforitsgreaterinvolvementinsupportofregionalinitiatives,aimingatclosercooperationonclimateandwaterissuesamongotherMiddleEastparties.Yet,thelatterisinlinewithitsambitiousgoalofexternalisingtheEUGreenDealbeyonditsbordersandaccompanyingitsSouthernNeigh-bourhood(SN)partnersintheirgreentransition(EC,2019).28Inthisrespect,asstatedinitsJointCommunicationona27MostofthemeetingsbetweenIsraeliandJordanianpolicy-makers,whichtookplacebetweenJulyandDecember2021,werecoveredprimarilybytheIsraelipresssuchastheJerusalemPost,TheTimesofIsraelandHaaretz.Formoreinformation,pleasesee:Staff,T.(2021)andTheJerusalemPost(2021).28TheEuropeanGreenDealisthenewEUgrowthstrategytofightclimatechangeandtotransformtheUnionintoamodern,resource-efficientandcompetitiveeconomy.By2050,theEUaimstohavenonetgreenhousegasemissions,decoupleeconomicgrowthfromresourceuse,and“leavenoonebehind.”Seehttps://ec.europa.eu/info/strategy/priorities-2019-2024/european-green-deal_en37AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegionRenewedPartnershipwiththeSouthernNeighbourhood,theEuropeanCommission(EC)hasalreadyproposedmobilising7billioneurosingreeninvestmentstofostersustainabledevelopmentoftheregion,mainlythroughtheNeighbourhood,Devel-opmentandInternationalCooperationIn-strument(NDICI),whichforeseesbothbi-lateralandregionalinitiatives(EC&EEAS,2021).AlthoughtheEUiscommittedtoenhanceitsdiplomaticengagementonwater(CounciloftheEU,2018),issupportingmultilateralsolutionsonwater(MarquesRuiz,2020)andhasreaffirmeditswilltoenhancetheregionalcooperationonenergy(UfM,2021a)aswellasonenvironmentandcli-mateactions(UfM,2021b),itsconcreteinvolvementinregionalinitiativespromotingcross-borderclimateresilientsolutionsre-mainslimited.Thisisbecause,althoughthereisalreadyanEUpolicyframeworkinplacetosupportregionalinitiatives,approachestotheenergy-waternexushaveyettobemain-streamedintopolicydevelopmentsandprogrammedesignandimplementation.ThelatterisencouragedbytheEC.29WhatarguablystillneedstobeclarifiedbytheEUinternallyishowtoensuretheop-erationalisationofregionalcooperation.AccordingtoaninformalfeedbackreceivedbytheEUdelegationinIsraelandtheOfficeoftheEuropeanUnionRepresentative(WestBankandGazaStrip),partofthisconcernspoliticalconstraintsandtech-nical-legal-administrativechallengesincross-borderengagements.Furthermore,whilethedesignandimplementationofregionalprogrammesindifferentthematicareasismanagedbytheEC(attheDirectorateGeneralforNeighbourhoodandEnlarge-mentNegotiations[DGNEAR]B2),theEUDelegationsontheground,whichcouldbetheEU’sarmtooperationaliseitsmulti-yearregionalprogramme,dealmainlywithbilateralcooperation.TheregionalpolicydialogueondifferentthematicareasisratherarticulatedthroughtheUnionfortheMediterranean(UfM).Thecompart-mentalisationofresponsibilitiesingeo-graphicallydistinctlocations(BrusselsfromonesideandEUDelegationsfromtheotherside)thereforehasanimpactontheoptimaldeclinationofbilateralandregionalcooperation.30Finally,regionalinitiativeswhichcouldbepotentiallyidentifiedandimplementedbytheEUDelegationsworkingonthegroundcouldhardlymaterialisewithoutaspecificbudgetallocatedforthatpurpose.TheEUDelegationtotheStateofIsraelhasim-plementedaseriesofworkshopsonclimatechange,energytransition,desertificationandwaterdesalination,bringingtogetherscientistsandpractitionersfromIsrael,thePalestinianAuthority,Jordan,theUAE,EgyptandMorocco,inanattempttofindsharedsolutionstocommonchallenges.31Theinitiative,whichusessciencediplomacyasaleveragetoadvancepeacefulandprosperousrelationsbetweentheregionalactors,isuniqueintheMiddleEastregion32andisexpectedtohaveasignificant29InformaldiscussionsandexchangeswithrelevantactorsintheEuropeanCommissionServices,dealingwithregionalandbilateralcooperationintheregion(e.g.,DGNEAR),October2021.30InformaldiscussionsandfeedbackinresponsetoquestionsformulatedtotheEUDelegationstoIsraelinTel-AvivandinJerusalemEast,October-November2021.31FeedbackbytheResearchandInnovationSection,inresponsetoquestionsformulatedtotheEUDelegationtoIsrael,2November2021.32AccordingtothefeedbackreceivedfromtheEUDelegationsandtheECserviceNEARB2Unit,thereisnoEUfundedprojectthatbringstogetherIsrael,PalestineAuthority,Jordan,theUAE,EgyptandMoroccoonenvironmental,waterandenergyissues.Approachestotheenergy-waternexushaveyettobemainstreamedintopolicydevelopmentsandprogrammedesignandimplementationPolicyStudyn.23AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegion38impact,highlightingtheroleoftheEUinpromotingandcontributingtothenor-malisationprocessintheMiddleEastandNorthAfrica(MENA)region.How-ever,withoutadedicatedbudget,itsfollow-upisdifficulttoenvision.PolicyrecommendationsandconclusionsEUclimatesecuritybeyonditsborders:whatremainstobedoneintheMiddleEastToovercometheintrinsiccomplexityintheMiddleEast,theEUshouldhaveastrongerhigh-levelpoliticaldrivefocusingonbigscaleandambitiousprojectswhichaddressclimatechange.RadicalchangesintheMiddleEastregionarepossible,andtheframeworkofwaterandenergyinterdepen-denciesamongregionalactorscouldbeapoliticalgamechangerforEUclimatese-curity.Nonetheless,thecomplexityoftheregionrequiresthemobilisationoftherightincentivestoattractleadinggreeninvest-mentsandmitigatethepoliticalrisk.ExternalisingtheEUGreenDealbeyonditsborderscallsfortheEUtoaccompanyitsSNpartnersintheirgreentransitionbysup-portingclimate-resilientinitiativesthatreflectthespecificpolicycontentofitssub-regions,suchasthatoftheMiddleEast.AsfarasPalestineisconcerned,theEUshouldsupportitsintegrationintothere-gionaldealbetweenJordanandIsrael.ThelattercouldpavethewayforgreaterEUinvolvementinrevampingtheIsraeli-Pales-tinianpeaceprocessnotbasedonthein-effective“landforpeace”formulabutonanew“cross-borderclimateandwatersol-utionsforpeace”formula.ConductingafeasibilitystudytoconnecttheJordanian-Palestinian-IsraelisolarelectricgridtoEu-ropewouldsignalEurope’sinterestinsup-portingaconcreteprojectandcertainlycouldpositivelyinfluencetheconstructionofthegrid(dellaRagione&Eran,2021).Inthisrespect,theEUcouldsupporttheincreasedaccesstofinancialsupport,tech-nologyandtechnicalknow-howexchangetodevelopIsrael-JordanandIsrael-Palestinepowerelectricitygridinterconnectionstoenabletheimplementationofclimate-resilientenergynexussolutionsintheregion,liketheoneproposedbyEcoPeaceMiddleEast.Moreover,theenablingenvironmentforin-vestmentinsustainablewater-relatedin-frastructureandservicesmustbeimproved.Thisneedstobecomplementedbyatailor-madeandstrongerpolicydialoguebetweentheEUandtheregionalactorswiththegoalofaligningnationalwaterandenergysectoralpoliciesandimplementationofintegratedwaterandenergyresourcesmanagement.Inaddition,theEUdelega-tionsshouldcooperatemorecloselyonclimate-relatedinitiatives,andfacilitatetheinvolvementoftheEuropeanInvest-mentBankwithlocalstakeholders,lever-agingitspossiblefinancialsupportinre-gionalgreenprojects.EUdelegationintheGulfcountriescouldbealsopartofthisattemptofregionalcooperationsincetheGulfcountriescouldbringgreatin-vestmenttosupportclimate-relatedprojectsintheMiddleEast,inlinewiththeexternal-isationoftheGreenDeal.Finally,moreuseneedstobemadeofblendingmechanismsandguaranteestoleveragemoreinvestmentsinwaterandrenewableinfrastructures.TheEUshouldbetterexploretherelativelynewdimensionofarticulatingthebilateralenvelopes(focusedonsupportingpol-icies)withthefinancinginstrumentsmobilisedthroughthebankingsystem(givingittheleverageforthenecessaryimpactatscale).39AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegionReferencesALRWASHDEH,S.,AL-SARAIREH,F.,&SARAIREH,M.A.(2018).SolarradiationmapofJordangovernorates.InternationalJournalofEngineeringeTechnology,7(3),1664-1667.Retrievedfromhttps://www.researchgate.net/publication/326832115_Solar_radiation_map_of_Jordan_governoratesAVIRAM,R.,HINDI,A.,&ABUHAMMOUR,S.(2020).CopingwithwaterscarcityintheJordanRiverBasin.TheCenturyFoundation.Retrievedfromhttps://tcf.org/con-tent/report/coping-water-scarcity-jordan-river-basin/?session=1&agreed=1BASSIST,R.(2021,October12).IsraelienergyministerhailswateragreementinJor-dan.Al-Monitor.Retrievedfromhttps://www.al-monitor.com/originals/2021/10/israeli-energy-minister-hails-water-agreement-jordanBROMBERG,G.,MAJDALANI,N.,&ABUTALEB,Y.(2020).TheGreenBlueDealfortheMiddleEast.EcoPeaceMiddleEast.Retrievedfromhttps://old.ecopeaceme.org/wp-content/uploads/2020/12/A-Green-Blue-Deal-for-the-Middle-East.pdfCOUNCILOFTHEEUROPEANUNION(CounciloftheEU).(2018).Outcomeofproceedings6125/18.Councilconclusionsonclimatediplomacy.Retrievedfromhttps://www.consilium.europa.eu/media/32953/st06125-en18.pdfDELLARAGIONE,T.(2021a).IsraelandJordanwater-energyinterdependence.TheInstituteforNationalSecurityStudies(INSS).Retrievedfromhttps://www.inss.org.il/publication/jordan-israel-water-2/DELLARAGIONE,T.(2021b).IsraelJordanandUAEcomecloseronanewwater-re-newabledealbrokeredbytheUS.WhatdoesitmeanfortheEU?EuroMeSCoSpotOnNº25.EuropeanInstituteoftheMediterranean(IEMed)Retrievedfromhttps://www.euromesco.net/publication/israel-jordan-and-uae-come-closer-on-a-new-water-renewable-deal-brokered-by-the-uu-what-does-it-mean-for-the-eu/DELLARAGIONE,T.,&ERAN,O.(2021,December1).IncludePalestinians,EUinIsrael-Jordanwater-energydeal-opinion.JerusalemPost.Retrievedfromhttps://www.jpost.com/opinion/include-palestinians-eu-in-israel-jordan-water-energy-deal-opinion-687567DROUGHT-HITJORDANTOBUILDREDSEADESALINATIONPLANT.(2021,June13).Arabnews.Retrievedfromhttps://www.arabnews.com/node/1875841/middle-eastEUROPEANCOMMISSION(EC).(2019).Communication2019/640,TheEuro-peanGreenDeal.Retrievedfromhttps://eur-lex.europa.eu/resource.html?uri=cellar:b828d165-1c22-11ea-8c1f01aa75ed71a1.0002.02/DOC_1&format=PDF.PolicyStudyn.23AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegion40EUROPEANCOMMISSION(EC)&EuropeanExternalActionService(EEAS).(2021).JointCommunication,RenewedpartnershipwiththeSouthernNeighbourhood.ANewAgendafortheMediterranean.Retrievedfromhttps://eeas.europa.eu/sites/de-fault/files/joint_communication_renewed_partnership_southern_neighbourhood.pdfGOVERNMENTOFISRAEL&PALESTINELIBERATIONORGANIZATION(PLO).(1995)Israeli-PalestinianInterimAgreementontheWestBankandtheGazaStrip.Retrievedfromhttps://www.ecf.org.il/media_items/624GOVERNMENTOFISRAEL(2021a).Decision171entitled,TransitiontoalowCarbonEconomyGOVERNMENTOF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1a).Institu-tional,regulatory,financialreformsandincentivepolicieshavebeenimplementedtoachievetheseobjectives.However,despitetheseefforts,environmentalcon-straints(waterstress,soildegradation,highenergydependency,vulnerabilitytoclimatechange,varioustypesofpollution)andthelimitedimpactofeconomicgrowthandsocialdevelopmentpolicies,intermsofemploymentandthereductionofsocialandterritorialdisparities,requireare-orientationoftheeconomicmodeltowardsagreenandinclusiveeconomy.Inthisdirection,thenewdevelopmentmodel33adoptedbyMoroccoadvocatesforasustainableMorocco,whereitisnecessarytostrengthentheprotectionofnaturalresourcesandbiodiversityandtoreformthewatersectorinfavourofusesreflectingthescarcityofthisvitalresource(CSMD,2021).ThischapterfocusesonasuccessfultransitiontoagreeneconomyforMoroccobyaddressingthefollowingquestions:HowcouldMo-roccoimplementitsnewdevelopmentmodelinitssocio-ecologicalcontext?Howcansustainableagricultureberec-onciledwiththeimperativeoffoodsecurityinthecontextofclimatechangeandwaterscarcity?Howcanclimatefinancebeusedforasuccessfulgreentransitiontohelpsmallandmedium-sizedenterprises(SMEs)andmicro,smallandmedium-sizedenterprises(MSMEs)usecleanenergy?WhatmodeofgovernanceforasuccessfulgreentransitioninMorocco?Itwillanalysethestakeholders’percep-tionsontheimplementationoftheNSDSintermsoflegalreformsundertaken,funding,governance,territorialisingofthestrategyandpartnershipbetweenthestate,privatesectorandcivilsociety.Inaddition,itwillidentifythesideeffectsandtheirmitigationmeasuresfortwomaineconomicsectors:agricultureandrenewableenergies,giventhevastex-periencethatMoroccohasaccumulatedinthesesectors.Morespecifically,itwillhighlightthechallengeofensuringfoodsecurityinacontextmarkedbyMorocco’svulnerabilitytoclimatechange,andexaminetherisksandobstaclesthatcouldaffectthesuccessofgreenhydrogenstrategiesforbothMoroccoandtheEU.ThechapterwillconcludebyproposingpolicyrecommendationsforasuccessfulgreentransitioninMo-roccointheframeworkoftheEuro-MediterraneanPartnership(EMP).33MoroccosetupanewdevelopmentmodelinApril2021,whereasustainableMoroccowithpreservednaturalresourcesinallterritoriesisamongitsstrategicdirections.PolicyStudyn.23AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegion44Besidestheliteraturereviewofthere-searchtopic,aqualitativeapproachispursued,usingsemi-directiveinterviewsconductedremotelyorinpersonwhenpossible.Theinterviewsinvolvedelevenpolicy-makersfromtheDepartmentsofAgriculture,Industry,Energy,SpatialPlanningandSustainableDevelopmentaswellasfromtheprivatesector,suchastheCherifianOfficeofPhosphates(OCP)groupandSMEs,andfromcivilsociety,suchastheNationalAssociationofLandImprovements,IrrigationandDrainage.MaindeficitsofimplementationoftheNationalSustainableDevelopmentStrategyAtthelegallevel,Morocconowhasafairlywell-developedbodyofenvironmentallegislationandregulations34comparedwithsimilarcountries.Nevertheless,thislegalframeworksuffers,ontheonehand,fromalackofeffectivenessandcom-plianceofeconomicoperatorswithitsrequirements,and,ontheother,severalenvironmentalareasarenotcoveredbylegislativeandregulatorymeasures35.Asforfinancing,Moroccohassetupseveralfundsdedicatedtovariouseconomicsec-torsconcernedwithsustainabledevel-opment(seeTable1)36.Themultiplicationofthesefundsandtheirgrantingmechanisms,whichdifferfromonefundtoanother,arenotadaptedtothefinancialcapacitiesofMSMEs,anddonotencouragethemtousegreentechnologiesintheirproductionprocess.Stakeholderspointoutthattheyarenotthemainbeneficiariesofthesefunds.Thisismainlyduetotheirlowself-financingcapacityandlowabilitytoputtogetherbankableprojects.Thestatehassetupthreemainmeasurestoaddressthisissue.Thefirstmeasureisaprogramme37thataimstosupportin-dustrialSMEs/MSMEsingreentechnol-ogy.ThesecondmeasureistheEnergyServiceCompany(ESCO)38andthelatterisamulti-stakeholderinitiativecalledWarmRoomGreenEconomyforthepro-motionofgreenprojects.However,thesemeasuresrequireanefforttoraiseaware-nessandinformationandafinancialeffortofthestatetobenefitalargenumberofSMEs/MEMEsthatmakeuptheMoroc-canindustrialfabric.IntermsofgovernanceoftheNSDS,thestatehasputinplaceasteeringmech-anismfederatingalltheministerialde-partmentsaroundtheobjectivesofthestrategy.Thisgovernancemechanismiscomposedoftwocommittees:anationalcommitteeandamonitoringcommittee.Themajorityoftheactorsinterviewedhighlightedthedelayintheimplementation34FrameworkLawno.99-12ontheNationalCharterfortheEnvironmentandSustainableDevelopment,Lawno.49-17onEnvironmentalAssessment,Lawno.13-09onRenewableEnergies,Lawno.47-09onEnergyEfficiency,Lawno.13-03onAirPollutionControl,Lawno.36-15onWater,Lawno.28-00onWasteManagement,Lawno.22-07onProtectedAreas,andsoon.35InterviewwithtwopolicymakersfromtheDepartmentofSuatainableDevelopment.36Mostoftheinformationonthemainfundsrelatedtosustainabledevelopmentwascollectedfromhttps://www.fellah-trade.com/fr/developpement-durable/fond-developpement-durable37ThisprogrammecalledTatwirGreenGrowthcoverssupportforinvestment,innovation,creativity,advice,andexpertiseforthegreentransformationofindustrialSMEs/MSMEs.38ThisserviceisgovernedbyDecreeNo.2-186165,whichmakesitpossibletofinanceenergyefficiencymeasuresthroughanticipatedsaving,whichlimitstheinitialinvestmenttobemadebytheprojectownerandreducestheneedforcapitalguaranteeswhenexternalfundsaremobilised.Atthelegallevel,Morocconowhasafairlywell-developedbodyofenvironmentallegislationandregulations45AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegionofthecommitmentsoftheministerialde-partmentsintheiractionplansforsus-tainabledevelopmentaswellastheweakinvolvementoftheprivatesectorandcivilNationalEnvironmentFundIndustrialDepollutionFundNationalUpgradingFundGuaranteeFundforEfficiencyandRenewableEnergyEnergyDevelopmentFundAgriculturalDevelopmentFundNationalForestryFundDomesticandindustrialwatertreatment,airpollution,solidwastemanagement,andsoonWater,EnergyandIndustryIndustryRenewableEnergyandEfficiencyEnergyRenewableEnergyAgricultureForestsTable1.MainfundsforsustainabledevelopmentinMoroccoFundsAreasConsistenceTheNationalEnvironmentFundisanincentivefinancialinstrumentinstitutedin2004byLaw11-03ontheprotectionanddevelopmentoftheenvironment.Itspurposeistocontributetothefinancingofenvironmentalandexperimentalpro-jects.TheIndustrialDepollutionFundcreatedin2003isanincentiveinstrumentthatencouragesenvi-ronmentalupgradingthroughtechnicalandfi-nancialsupportforindustrialorcraftenterprises.Itfinancesprojectsinvolvingtheinstallationoffacilitiesforthereductionandeliminationofallformsofliquid,solidorgaseouspollution.Itcon-tributestotherealisationofprojectsensuringtheeconomyofresources,notablywaterandenergy,throughthechangeofprocessesandtheuseofcleantechnologies.Createdbythestatein2003,theNationalUp-gradingFundisintendedtosupportSMEsintheirupgradingefforts.Theaimistoprovidefi-nancialsupporttocompaniesfortheirmodern-isationneeds.TheRenewableEnergyandEfficiencyGuaranteeFundisintendedtoguaranteeinvestmentcreditsgrantedbycreditinstitutionstoMoroccancom-paniesandoperatorswishingtoinvestinRe-newableEnergy(RE)andEnergyEfficiency(EE).Createdin2009,thisfundwillstrengthenandsecureexistingproductioncapacity,andprovidefinancialsupportforenergyefficiencyprojectsandenergyservicecompanies.Afunddedicatedtothegrantingofstateaid,whichaimstosupportprivateinvestmentandthedevelopmentofsustainableagriculture.TheNationalForestryFundwasestablishedin1949andispartlyfinancedbyataxonforestryproducts.Itaimstosupportsustainableforestmanagement.societyinthemonitoringoftheimple-mentationoftheNSDS.Somestateactorshavepointedoutthelackofcon-tinuityinthefeedingoftheNSDSmoni-toringindicatorsbythesectoralministerialdepartments.Concerningthepartnershipbetweenstateactors,theprivatesectorandcivilsociety,alltheactorsinterviewedstressedthestrategicimportanceofthepartnershipbetweenthesethreecategoriesforthesuccessofthegreentransition.Betterinvolvementandsynergybetweenthethreeactorsintermsoftheactionplanandcommitmentarestillneeded.Attheterritoriallevel,althoughtheRegionalSpatialPlanningScheme(RSPS)setsouttheguidelinesforthesustainablede-velopmentoftheterritoryandisimple-mentedwithintheframeworkofRegionalDevelopmentPlans(RDP),thepartnershipwiththeprivatesectorandcivilsocietyremainsverylimited,withtheexceptionofcertainlargecompaniesthatarepresentincertainterritories.39SustainableagricultureforMorocco’sgreentransitionTheimportanceofdevelopingsustainableagriculturehasbeenhighlightedbypol-icy-makersinterviewedfromtheDepart-mentofAgricultureasanalternativetoclimatechange,butitissubjecttothechallengeoffoodsecurityinacontextofclimatechangeandthescarcityofwaterresources.Themainsideeffectsofagreentransitionintheagriculturalsectorrevolvearoundthenon-integrationofen-vironmentalandclimaticriskspriortothereviewofagriculturalpolicies,thelongdiffusionofgreentechnologies,particularlyforsmallfarmers,limitedfinancingofag-riculturalresearchandinnovation,andthegenesisofhighgreentransitioncosts.Howcansustainableagricultureandfoodsecurityissuesberec-onciledinMorocco?TheclimateissueistakenintoaccountbythenewagriculturalstrategycalledGreenGenerationthroughitsresilientandeco-efficientagricultureaxis.Itaimstoencourageandsubsidiseagro-ecolo-gicalsystems,includingdirectseedingsystems,organicfarming,digitalfarming,agroforestry,andinnovativeirrigationef-ficientsystems(MAPMDREF,2021b).Althoughthisstrategyhasgivenparticularimportancetotheecologicaltransition,itisessentialthatitcreatesadynamicofchangecentredonregenerative,cli-mate-smartagricultureandhelpstoes-tablishcomplementaritiesbetweenpro-ductionbasinstoensurethepillarsoffoodsecurityandmitigatetheeffectsofclimatechangeandthevolatilityofmarketfactors.40Intermsoffoodsecurity,theannualavail-abilitypercapitahasevolvedbetween2008and2018byaratevaryingfrom16%forcerealsto43%forwhitemeats,withtheexceptionofsugar,whichhasexperiencedareductionof6%(HCP,2020).ItistruethatMoroccoisnotfoodinsecure.Ithasmaintainedtheprevalenceofundernourishmentatalevelof5%since1990-1992,butitremainsvulnerabletoclimatechangeincaseofrecurrenceofdroughtandexternalshocks(Toumi,2016).Tosucceedinthischallenge,sol-utionsexist,andMoroccodoesnotlackassetsthatmustbeexploitedinaclearintegratedandsustainablevision.39InterviewwithapolicymakerfromtheDepartmentofSpatialPlanning.40InterviewwithanexpertinclimatechangeandfoodsystemsfromtheDepartmentofAgriculture.PolicyStudyn.23AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegion4647AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegionThesustainableintensificationofproductionsystemsisanalternativethatrequirestheimplementationofconservationagricultureandagro-ecologytechniques.Indeed,theNationalInstituteofAgronomicResearchhasshownthatconservationandpluvialagricultureviadirectsowingallowsonaverageacarbonsequestrationfrom1to4tonnesofCO2/ha,reducesenergycon-sumptionby70%,andincreasesyieldsby30to40%,andwaterproductivityby60%(FARM,2015).Althoughconsiderableprog-ressispossibleintermsofwaterproductivity,soilconservation,lowercostsandresilienceofproductionsystems,andthereforesus-tainabilityandfoodsecurity,theintegrationofinnovationsintothelocaldevelopmentprocessislargelylacking.Atthislevel,theroleofscientificandagronomicresearchhasagreatcontributiontomakeinguidingagriculturalproductioninasustainablevisionandallowinghealthyfoods.Moroccomustalsocontinueitsefforts41inthepres-ervationofgeneticdiversityofseeds,cropsandlivestock,aswellasintheconservation,characterisationandevaluationofgeneticresources,promotionofresearch,training,andtechnologytransfer.Oneofthestrategicthemesforthedevel-opmentofsustainableagricultureisthemassivereductionoffertiliserusebyfarmers.Withreferencetothelaunchofthe2021-2022agriculturalseason,theavailabilityoffertilisersshowsastockof500,000tonnes,ofwhich450,000tonnesaregen-erallyused,i.e.,autilisationrateof90%.42Astrategyofreasonedandoptimalfertil-isationisanalternativetopromotetheefficiencyoffertiliserusebyfarmersandreduceitsuse.Theinterviewwiththeco-ordinatoroftheAlMoutmirprogrammeoftheOCPemphasisedtheimportanceofthisprogramme,whichaimstoprovidefarmerswithmobilelaboratoriestodelivertherightfertiliser,intherightquantity,attherighttimeandintherightplacewiththegreatestprecision.Itprovidestraininginsustainablefertilisationpracticesviadedicateddigitalplatforms,butonlyper-forms20,000soilanalysesperyearforfarmers.Certainly,farmers’useofsoilanalysisremainslow,althoughthestatesubsidisestheuseofsoilanalysisundertheAgriculturalDevelopmentFund.Basedontheseobservations,itishighlyrecommendedtopromotebothagrofor-estryincroppingsystemsatthefarmlevelandagro-ecologicalintensificationtoincreasetheproductivityofagriculturalwatersandtheresilienceofagro-sylvo-pastoral,rainfedandirrigatedsystems.Moreover,itismoredesirabletoincreasetheawarenessofsmallfarmingabouttheissuesoffoodsecurityandclimatechangethroughthetrainingoffarmers,farmerleadersandterritorialanimation,andprovidethemwithsupporttousedigitaltechnologyforbettermanagementoftheirsustainableagriculturalproductionsystems.Withintheframeworkofastrategicpart-nershipbetweenthestateandOCP,itwouldhelpgeneraliseonalargescalereasonedandoptimisedfertilisationtosmallfarmers.Ultimately,increasingsup-portfornationalagriculturalresearchonthesustainableuseandconservationofbiodiversityforfoodandagricultureand41Moroccoisoneofthefirstcountriestohaveratifiedseveralconventions,includingtheConventiononBiologicalDiversity,theGlobalPlanofActionfortheConservationandSustainableUseofPlantGeneticResourcesforFoodandAgriculture,andtheInternationalTreatyonPlantGeneticResourcesforFoodandAgriculture.42ThisdatawastakenfromaPowerPointpresentationbytheMinistryofAgricultureonthelaunchofthe2021-2022agriculturalseason.Itshouldbenotedthatthestatedoesnotsubsidisefertilisersbutensuresthatpricesarestabilisedbyguaranteeingthesupplyoffertiliserstothemarket.OneofthestrategicthemesforthedevelopmentofsustainableagricultureisthemassivereductionoffertiliserusebyfarmersPolicyStudyn.23AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegion48providingthenecessaryfundingmaybeofassistance.RoleofefficientandrationaluseofwaterresourcesWaterresources43arethemainfactorli-mitingthedevelopmentofirrigationofag-riculturallands.Tomanagethissituation,thewatercontrolandmanagementpolicywithintheframeworkoftheMoroccoGreenPlanhasmadeitpossibletocarryouthydro-agriculturaldevelopmentsinanareaofnearly800,000haunderirrigationin2019forthebenefitof220,000farmsaswellasawatersavingof2billionm3ofwaterannuallyandareductionoftheover-exploitationofthewatertablethroughtherecoursetoalternativesofdesalinationofseawaterandthereuseofwastewater(MAPMDREF,2021a).TheinterviewconductedwiththeofficialsandexpertsoftheDepartmentofAgricultureinwaterresourceshasidentifiedthesec-ondaryeffectslikelytoimpactthesealter-natives.Thedesalinationofseawaterposesaproblemofenvironmentalpollution,sincethesaltreleasedfromthewater,whichwillbeusedforirrigationpurposesanddrinkingwaterconsumption,isdepositedwithoutanyrecovery.Asforthereuseofwastewater,italsoposestheproblemofdepositingsolidwastefromthereusedwater,whichispollutingtheenvironment.Tomitigatetheseenvironmentalimpacts,researchstudiesshouldbecarriedoutfortherecoveryofsolidwasteandreusedwateraswellasforthesaltreleasedfromdesali-natedwater.Moreover,oneofthenegativepointsraisedintheinterviewistheabsenceofmodellingstudiesofthewaterbalanceatthelevelofthehydraulicbasinsandsub-basinsinordertocontroltheflowsofwaterinandoutinthemediumandlongterm.Thisbringsintoplaytheroleofagriculturalwaterproductivity,whichremainsamajorchallengetobeovercomeinMorocco.Thus,improvingknowledgeofagriculturalwaterproductivityandthewaterlossesthatcanbeobservedshouldbecon-sideredapriorityforanypolicyaimedatincreasingagriculturalwaterproductivity.Similarly,rainwaterharvestingandtheef-ficientandrationaluseofwatershouldbeencouragedanddevelopedamongfarmerswhomaintainirrigationtechniquesandpracticesthatleadtowaterlosses.Renewableenergies:apillarforthedevelopmentofthegreentransitioninMoroccoThedevelopmentofrenewableenergiesinMoroccoisattheheartoftheNationalEnergyStrategy,whichisorientedtowardsadiversificationofenergysupplysourcesbyincreasingtheparticipationofgreenenergiesto52%ofthetotalinstalledelec-tricalpowerby2030(MTEDD,2021b).Inordertoreduceitsenergybill,Moroccohasadoptedanationalenergyefficiencystrategythataimstoachieveenergysavingsofaround25%by2030throughbetteruseofenergyinallareasofeconomicandsocialactivity(AMEE,2014).MainsideeffectsoftheenergytransitionandtheirmitigationmeasuresIntheirrigationsector,theuseofcleanenergyisnotyetwidespreadbecause43Percapita,waterresourcesaretendingtodecreaseduetopopulationgrowthandclimatedrying.By2030,thecountrywillbeatthethresholdofscarcity(500m3/inhabitant/year)(Laouina,2006).49AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegionsubsidiesforfarmersarenotyetprovidedforundertheAgriculturalDevelopmentFund.Indeed,accordingtothestudyonthestructuringofthedevelopmentofsolarpumpinginMorocco,realisedbytheGEF-solarpumpingproject44in2018,thereisariskofcreatinganimbalanceinthemarketbetween,ontheonehand,bigfarmersabletoinvestinphotovoltaictechnologyandthusreducetheirproductionpricesbyreducingtheirenergybills,and,ontheother,smallfarmersunabletoacquireaphotovoltaicpumpingsystemandcon-sequentlyseetheircompetitivenessaffectedbytheenergybill.Hencetheneedforpublicpoliciestoprovideamodelforaccesstophotovoltaictechnologybasedoninnovativefinancialproductsandsupportforsmallfarmerstobalancethemarket.Thisisevenmorenecessarygiventhatthecompetitivecostofsolarwaterpumpingcomparedtoconventionalenergysourcesisverycompetitive(0.44dirhamspercubicmetreofwatercomparedto0.76dirhamsforsubsidisedbutaneand1.67dirhamsfordiesel)(MTEDD,2021c).Anothersideeffectlinkedtosolarpumpingirrigationistheriskofover-exploitationofthewatertableasaresultofapplyingthesolarirrigationsubsidy,whichencouragesfarmersnottolimitpumping.Thisobserva-tionwasconfirmedbytheaforementionedstudywherephotovoltaicinstallationsareoversizedinrelationtothewaterneedsofthecropsandtheirlowenergycostscanleadtoexcessivewateruse.Toavoidthisrisk,agooddimensioningofthephotovoltaicpumpingsysteminrelationtothewaterneedsisessential.Alsonotedduringtheinterviewsweretheenvironmentalproblemrelatedtothenon-recyclingofpipingandmaterialsusedinirrigationaswellasthedamagingeffectofthesubsidyofbutanegasusedinirrigation,whichmaycompro-misethecompetitivenessofsolarirrigation.Forthefirsteffect,asolutionisneededfortherecyclingandrecoveryofplasticequip-mentandtoincreasefarmers’awarenesstoobtainmaterialswithabetterenviron-mentalfootprint.Withregardtothesecondeffect,itisessentialtograduallyeradicatethisgassubsidy,whichisalsovalidfortheenergyandindustrysectors.RegardingthegreentransitionofindustrialSMEs/MSMEs,whichunfortunatelyisnotyetgeneralisedinMorocco,themainsideeffectsconsistofreluctanceandlackofknowledgeofSMEs/MSMEstoinstallcleanequipmentduetoitshighcostandthereturnoninvestmentforgreenenergyislongcomparedtothermalenergy.Inad-dition,theactorsinterviewedmentionedtheneedforMSMEstotakecontrolofthetechnicalfeasibilitystudiesrequiredfortheinstallationofcleanequipment.Theypro-posedthefollowingmitigationmeasures:•StateincentivesforSMEs/MSMEstomovetowardstheinstallationofcleanequipmentintheirproductionprocessthroughthegrantingofsubsidieswithintheframeworkoffundsdedicatedtoenergydevelopmentorloansatverylowratesorpremiumsforinvestmentincleantechnologies.•Reschedulingthecostoftheinvestmentinthemediumandlongterm(5to7years)withintheframeworkofanagree-mentbetweenSMEs/MSMEsanden-gineeringfirmsspecialisingintheinstal-lationofcleanequipment.•RaisingawarenessamongSMEs/MSMEstotakeadvantageoftheVocationalTrainingTaxinordertobenefitfrom44TheGEF-SolarPumpingprojectwaslaunchedbytheMoroccanAgencyforEnergyEfficiencyinpartnershipwiththeUnitedNationsDevelopmentProgramme(UNDP),andaimstopromotethedevelopmentofphotovoltaicsystemsforirrigation.PolicyStudyn.23AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegion50traininganddevelopmentexpertiseintheinstallationofcleanequipment,theircontrolandmaintenancefollow-up.•Capacity-buildingofSMEs/MSMEsinthereception,technicalfeasibilitystudies,theircontrol,andfollow-up.ThepotentialofgreenhydrogeninMorocco:issuesandchallengesRecognisingtheglobalstrategicimpor-tanceofgreenhydrogenasarenewableenergystoragevectoranditsroleinac-celeratingthede-carbonisationofindustry,Moroccohasdevelopeditsnationalgreenhydrogenstrategyfortheperiod2020-2050(MTEDD,2021d).FortheEU,hydrogenisaninvestmentprioritytostimulateeconomicgrowth,createlocaljobsandstrengthentheEU’sgloballeadership.ItsHydrogenStrategyRoad-mapconsidersNorthAfricaapotentialsupplierofrenewablehydrogenatacom-petitivepricefortheEUrequiringthatthedeploymentofrenewableenergypro-ductioninNorthAfricancountriesbestronglyaccelerated(EC,2020).TheanalysisofthetwogreenhydrogenstrategiesofMoroccoandtheEUcon-vergestowardstheneedformorecoop-erationandpartnershipforbothpartiesingreenhydrogeninordertoachievetheirrespectiveobjectives.ThenewMo-rocco-EUGreenPartnershiphasbeendevelopedfromthisperspectivetotriggerarealparadigmshifttowardsaprosperousandresilienteconomicsystemforbothparties.Thus,themainquestioniswhatrisksandobstaclescouldhaveanimpactonthesuccessofthesestrategiesintheframeworkofthisgreenpartnership?FortheMoroccancontext,theambitiontoexportgreenhydrogentoEuroperequires,ontheonehand,higherpro-ductionofelectricityfromrenewablesourcesthancurrentlyproducedand,ontheother,theavailabilityofsufficientwaterfortheproductionofgreenhydrogen.ThoughMoroccoaimstoobtainthenecessaryfreshwaterfromseawaterde-salination,itwouldmeanthatevenmoreenergywouldhavetobeproducedfromrenewablesources(Lamrani&Bauman,2021)andwillrequiremorefundsandForeignDirectInvestment(FDI)(Bennis,2021).Inordertoensurefinancingforitsgreenhydrogenstrategy,Moroccohasalreadyconcludedpartnerships,notablywithGer-many45andPortugal,andisseekingtodi-versifyitspartnershipwithothercountriesoutsidetheEU,notablyChina,GreatBritain,IndiaandtheUSA.ForChina,itstechnicalexpertiseassociatedwithitshugeinvest-mentpotentialallowsittooffergovernmentsaroundtheworldextremelyattractivepack-agesandcancompetewiththeEUinim-plementingitsgreenhydrogenstrategywithcountrieslikeMorocco.Europehasputinplacethefinancialinstruments46topromoteitsgreenagendaandcanmaximiseitsadvantageoverChinaintheareabyensuringthattheseinstrumentscombinetoformanattractivewholeanddrawonitsdiplomacywithpartnercountriesundertheguidanceoftheEuropeanGreenDeal.Inthisperspective,theEUhasrecentlysetuptheGlobalGatewayinitiativeto45WiththeresumptionofdiplomaticrelationsbetweenMoroccoandGermany,thecooperationagreementconcludedinJune2020ontheproductionof100MWofhydrogenenergyby2025shouldbecontinued.46In2018theEuropeanCommission(EC)proposedEFSD+,whosebudgetstandsat€89.2billion,ofwhich30%istobeallocatedtoclimate-relatedobjectives(Bennis,2021).FortheEU,hydrogenisaninvestmentprioritytostimulateeconomicgrowth,createlocaljobsandstrengthentheEU’sgloballeadership51AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegionstrengthensustainablelinksaroundtheworld.Thisinitiativeaimstomobiliseupto€300billionininvestmentsbetween2021and2027tounderpinalastingglobalrecovery,takingintoaccountourpartners’needsandtheEU’sinterests(EC,2022).Furthermore,theintroductionofanob-ligationforexportingcountriestopayacarbontaxattheborderstoEuropecouldbeanobstacletotheestablishmentofgreenelectricalconnectivitypartner-shipsbetweenMoroccoandtheEU,especiallywithcountriesinclosegeo-graphicalproximity,suchasSpainandPortugal.ThismeasurewillaffecttheamountofelectricityMoroccocanexporttoEurope,asexportswouldhavetocomplywiththeEU’sclimateneutralitypolicy(Bennis,2021).Additionally,theexportofhydrogenfromMoroccototheEUcanbetransportedthroughtheportofNadorWestMed,whichiscurrentlyunderconstructionandofferslargestoragefacilities(Bennis,2021)orthroughthedevelopmentofanewpipelinerunningfromMoroccoviaSpaintoEurope.Thesealternativeswillreplaceexistinginfrastructures,suchastheMaghreb-EuropeGasPipeline,whichtransitsviaAlgeriaandwhosecontractisnotrenewedduetothecurrentpoliticalcrisisbetweenMoroccoandAlgeria.TheroleofinternationalclimatefinanceinMorocco’sgreentransitionMoroccohassetambitiousclimatetargetsfor2030initsNationallyDeterminedContribution(NDC).IthasincreasedthetargetsofthefirstversionoftheNDCbypresentinganoverallmitigationtargetof45.5%by2030,includinganunconditionaltargetof18.3%.Moreover,Morocco’scommitmenttoitsupdatedNDCwillrequireagreeninvestmentof$38.8billionfortheglobalmitigationtargetof45.5%and$17.3billionfortheunconditionaltargetof18%(MTEDD,2021e).ThemobilisationofinternationalfundstomeetthispriorityremainsamajorchallengeforMorocco.EventhoughMoroccoisamongthemainbeneficiarycountriesintheMiddleEastandNorthAfrica(MENA)regionwithanamountof$293.8millionin2020,thefundingreceivedisnowherenearcapableofachievingthecountry’sclimatechangemitigationandadaptationambitions.Indeed,climatechangeadap-tationprojectsrepresentonly4%ofthefundingreceivedcomparedto96%fortheprojectstoreduceGHGemissions47.Thus,inordertoincreasetheinternationalfinancialeffortandimprovethedistributionoffundsbetweenmitigationandadaptationthroughamorebalancedarbitration,Mo-rocco,asacountryhighlyvulnerabletoclimatechange,needstodevelopmoreimpactfulandinclusiveadaptationprojects.Oneofthemainreasonsforthisobser-vationisthatMoroccodoesnothaveanationalstrategyforinternationalclimatefinancetomobilisesignificantfundstofi-nanceitsclimateobjectives,knowingthatthesectoraldepartmentslackspecialisedtechnicalskillsinmobilisinginternationalclimatefundsintermsofpresentingbank-ableprojectsthatmeetthecomplexanddiversifiedmechanismsofthesefunds.Forexample,theGreenClimateFundaccreditsonlytwonationalstructuresinMorocco:theNationalAgencyforAgri-culturalDevelopmentandtheMoroccanForeignTradeBank.47DataisretrievedfromthesiteofCFUhttps://climatefundsupdate.org/TheintroductionofanobligationforexportingcountriestopayacarbontaxattheborderstoEuropecouldbeanobstacletotheestablishmentofgreenelectricalconnectivitypartnershipsbetweenMoroccoandtheEUPolicyStudyn.23AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegion52ConclusionandrecommendationsInconclusion,theanalysisofthepercep-tionoftheactorsconcernedwiththegreentransitioninMoroccowasrichinlessonsandallowedidentificationofpolicyrecommendationstoeffectivelyachievethesuccessfulgreentransition.Theinte-grationoftheserecommendationsintheimplementationoftheNSDSwillmakeitpossibletorespondtothestrategicorien-tationsofMorocco’snewdevelopmentmodelinpreservingitsnaturalresources.Briefly,thesepolicyrecommendationsaresummarisedas:Ensureeffectivenessoftheenviron-mentalregulationToensuretheeffectivenessoftheenvi-ronmentalregulationinforce,itisadvisabletostrengthenthemeansandprerogativesofmonitoringandcontrolofcompliancewithenvironmentalregulations,particularlythoseoftheenvironmentalandwaterpolicy.Forgoodmeasure,itisrecom-mendedtocarryoutimpactstudiesoflawanddecreeprojectsrelatedtotheenvironmentbeforetheiradoptioninordertoevaluatethemeansandprerequisitesfortheirsuccessfulimplementation.Inaddition,itisimportanttoacceleratethepreparationoftheimplementingtextsoftheselawsanddecreesandtoexpandcoverageofnaturalenvironmentsthroughnationalenvironmentallegislation,suchasthesoilact,accesstotheenvironmentalinformationact,environmentalliability,andenvironmentalcrime.Anewgovernancemodeforasuc-cessfulMoroccangreentransitionOnthebasisofthedeficitsofgovernanceraised,itisstronglyrecommendedtomainstreamtheissueofasuccessfultransitiontoagreeneconomyoftheNSDSintonationalthematiccommitteesledbyinstitutions.Inotherwords,eachcommitteeissteeredbytheministerialdepartmentconcerned,whichreportstothenationalandmonitoringcommittees.Thisneworganisationmechanismwillstrengthenthenecessaryinstitutionallink-agesbetweenalltheexistingcommittees.Itwillalsoreinforcecoordinationandcol-laborationbetweenactors,andcreatesynergiesandconvergencesbetweensectoraldepartmentstoavoidduplicationintermsofbothstatefundingandtechnicalobjectives.Itwilldevelopapartnershipbetweenthestate,theprivatesector,andnon-gov-ernmentalorganizations(NGOs)inthepromotionanddevelopmentofthegreentransitioninMorocco.Fromhere,itises-sentialtoseizetheopportunityoftrans-latingthenewdevelopmentmodelintoanationalcharterfordevelopmenttointe-gratethetransitiontoaresilientandcar-bon-neutralgreeneconomyintheresultingnationalpactviaclearandcontractualcommitmentsaroundthegreentransi-tion.TerritorialgovernancerequiresthecreationofanationalcommitteeofsustainableregionsinchargeoftheterritorialisationoftheNSDS,andtodevelopmethod-ologicaltools,accordingtoapilotregion.TheroleofthiscommitteeistodevelopRSPSsandRDPsthatintegratetheprin-ciples,orientationsandchallengesoftheNSDSintheirdesign,validation,moni-toringandfollow-upprocessesoftheirimplementation.ReinforceinclusivefinanceofthegreentransitionToovercomethefundingconstraintlinkedtothemultiplicationoffundsandtheirgrantingmechanisms,itisrecommendedTerritorialgovernancerequiresthecreationofanationalcommitteeofsustainableregionsinchargeoftheterritorialisationoftheNSDS53AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegiontoreformtheNationalEnvironmentFundtowardsasustainabledevelopmentfundwithaninclusivefinancialandeconomicmodelofsupplyandexpenditure.Thismodeldefinesthemodalitiesofgovern-anceandgrantingofloans,donations,participation,accordingtothespecificitiesofthesectors,thecategoriesofenterprisesnotablySMEs/MSMEs,andtheirself-fi-nancingcapacity.Thisnewfundmustbecorrelatedwithaclearandfairenviron-mentaltaxincentive.AcampaigntoraiseawarenessandinformSMEs/MSMEsaboutfundingandsupportopportunitiesofferedbythestateismoredesirableforeffectivepromotionofthegreentransitionofthesecompanies.Cor-respondingly,itisadvisabletointroduceaneco-labelasenvironmentally-responsibleenterprisestoencouragethemtopromotetheircleanproducts,strengthentheirbrandimage,increasetheirprofitsthroughcertifiedcredibility,anddevelopstrategicpartnerships.Strengthenthegreenpartnershipbe-tweenMoroccoandtheEUArecentstudybytheOrganisationforEconomicCo-operationandDevelopment(OECD)48in2021entitled‘’RegionalIn-tegrationintheUnionfortheMediterra-nean:ProgressReport’’concludedthatsomecountries,suchasMorocco,Tunisia,andEgypt,havesucceededindiversifyingtheireconomiesandintegratingthemintoregionalvaluechains,buttheEUremainstotallydominantastheoriginordestinationofintra-Mediterraneantrade.InordertomakeregionalintegrationpossibleintheEuro-Mediterraneanarea,regionalgov-ernanceandmultilateralcooperationbasesaremorethannecessaryandgobeyondmarketforcesalone(OECD,2021).InthisrespectandtakingintoaccounttherichexperienceofcooperationbetweenMoroccoandtheEUinthefieldofgreendevelopment,thegreenpartnershipcanbeamodeltobefollowedbytheothercountriesofthesouthernshoreoftheMediterraneanwhiletakingintoconsider-ationthefollowingaxisinordertomakeasuccessofthegreentransitioninMo-rocco:OnthefinancialsideEUsupportforMoroccoisrecommendedthroughthesectoraldepartmentscon-cernedwiththegreentransitioninthedevelopmentofanationalclimatefinancestrategyandtotrainapoolofnationalexpertsinthetechnicalandfinancialset-upofadaptationandmitigationprojects.Inthesamevein,itispreferabletousebilateralcooperationinstitutionsintheEuro-Mediterraneanareathatareac-creditedbyinternationalclimatefundssuchastheFrenchAgencyofDevel-opmentandtheEuropeanBankforRe-constructionandDevelopment(EBRD)supportMoroccoindevelopingnationalexpertiseintermsofpresentingNDCprojectseligibleforinternationalclimatefinancecriteria.ThesamegoesforleadingEUclimateactioninstitutionssuchastheEuropeanInvestmentBank(EIB)49.Havingacquiredthisexpertise,MoroccocanserveasaregionalhubforstrengtheningAfricantriangularcooper-ationonenvironment,climateandsus-tainabledevelopmentissuesandthusre-inforceitsproactivecommitmenttoSouth-Southcooperationintheseareas.48ItisastudycommissionedbytheUfMtotheOECDtoanalyseeconomicintegrationintheMediterranean.49TheEIBGroupClimateBankRoadmap2021-2025outlinestheEU’sgoalsforclimatefinancethatsupportstheEuropeanGreenDealandhelpsmakeEuropecarbon-neutralby2050(https://www.eib.org/fr/publications/the-eib-group-climate-bank-roadmap)PolicyStudyn.23AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegion54AsregardstheGreenDealforEurope,itisstronglyrecommendedtoexploitthefi-nancialmechanismssetupbythisgreenpactinordertoputatthedisposalofMo-roccofundswithintheframeworkofgrants,technicalassistance,and/orloanagree-ments.ItwillencouragetheSMEs/MSMEstobecomeeco-responsibleandtoreducethelimitingfactors,inparticularrelatedtotheaccessibilityofthegreentechnologywhosecostisveryhightotheirfinancialca-pacities.ItisalsorecommendedthroughtheseEUfinancialmechanismstoencourageEuropeanenterpriseswillingtoinvestinre-newableenergiesinMoroccoinordertotransferitsgreentechnologytoMoroccoandconsequentlyaddresstherootcausesofirregularmigrationandforceddisplacement(Bennis,2021).Inaddition,theinvestmentsoftheGreenDealfundscoulddirectlycreatejobsinrenewableenergyinMoroccoandhelpnascentlocalrenewableenergyindustriestodevelopbyinvolvinglocalde-velopers,subcontractorsandworkers.Accordingtoa2012studybytheMedi-terraneanForumofEconomicSciencesInstitutesentitled‘’RenewableEnergiesandSustainableDevelopmentintheMedi-terranean:MoroccoandtheMediterraneanSolarPlan(MSP)’’,therenewableenergysectorinMoroccocouldgeneratebetween265,000and482,000jobsinthecountryby2040(Lorca&DeArce,2012).OnthetechnicalsiderelatedtothegreentransitionAmongthetechnicalareasrequiringEUtechnicalsupportandassistanceforMo-rocco,thefollowingshouldbementioned:•Supportinsettingupthebasisforanintegratedandterritorialisedgreentaxandanationalcarbonmarket.•ReinforcementofthecapacitiesoftheSMEs/MSMEsintermsofreception,validationofthetechnicalfeasibilitystudiesofthecleanequipment,control,andfollow-upofmaintenanceofthein-stallationsrelatedtocleanenergy.Thiscapacity-buildingshouldanalysetherealcostsoftheseinstallationsandthecostsofprofitabilityrelatedtotheclimateandenvironmentalstudies.•Strengtheningcooperationinagriculturalresearchandinnovation.•Implementationofcleantechnologiesinmanufacturingprocessesandmaterialflows,allowingarationaluseofrawma-terialsandthereductionofthequantityofeffluentspollutingtheenvironment.•Consultingandtechnicalexpertiseser-vices,includingenergyauditsanddiag-nostics.OnpoliciesrelatedtotheGreenDealforEuropeTheestablishmentofagreenpartnerlabelofrelationsbetweentheEUanditspartnersonthesouthernshoreoftheMediterraneanwillfacilitateaccesstoandassociationwithEUinitiatives,politicaldialogueandfunding.ItwillpromotetheEU’sleadershipintheEuro-Mediterraneanareavis-à-visitscompetitors,particularlyChina,andwillattractotherthirdcountries,suchasthoseinsub-SaharanAfrica(Bennis,2021).InordertoovercomethechallengesandobstaclesmentionedaboveongreenhydrogenforbothMoroccoandtheEU,thegreenpartnershipbetweenthetwopartiesshouldcontributetotheconclusionofastrategicgreenhydrogenalliancebasedonanintegratedapproachtothesechallengesandacontinuoushigh-levelpoliticaldialogueinordertoachievesuc-cessfulgreendiplomacythattakescareofthepoliticalandeconomicinterestsofeachparty.TherenewableenergysectorinMoroccocouldgeneratebetween265,000and482,000jobsinthecountryby204050HorizonEuropeistheEU’skeyfundingprogramme2021-2027forresearchandinnovationwithabudgetof€95.5billion.ItisoneofthemaintoolstoimplementEurope’sstrategyforinternationalcooperation.Inhttps://ec.europa.eu/info/research-and-innovation/funding/funding-opportunities/funding-programmes-and-open-calls/horizon-europe_fr55AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegionConcretely,itissuggestedthatahigh-levelstrategiccommitteebeestablishedbetweenthetwopartieswiththeobjectiveofdevelopingaroadmapbasedonanin-depthanalysisoftheopportunitiesandconstraintsforasuccessfulgreenhydrogenstrategicallianceandcapitalisingonMorocco’scooperationprojectswithEUcountriesinthisfield.Inaddition,itispreferabletosecurethisalliancebysettingupspecificfinancialmechanismsaccordingtothewin-winpartnership,specifyingthecontributionsofeachpartyandaffectingallthelinksinthegreenhydrogenchain.Inthisregard,theEUshouldensurethecreationofaMediterraneanRenewableEnergyCommunitytostrengtheninstitu-tionalsupportforthedevelopmentofgreenenergyandbuildnewgreenelec-tricalinterconnectionstoincreaseenergyinterdependencebetweentheEUandgeographicallyclosecountries,suchasMorocco.ThiswouldhelpfacilitatetheexportofgreenelectricitytoEUcountries,suchasSpainandPortugal(Bennis,2021).GiventherolethatresearchandinnovationcanplayinacceleratingandorientingMoroccotowardsthegreentransition,cooperationbetweenMoroccoandtheEUshouldbefurtherstrengthenedingreentechnologies.ThroughitsHorizon50programmeoffundingforresearchandinnovation,theEUcansupportMoroccoinacquiringcutting-edgetechnologyinspecificsectors,suchasrenewableenergy,andthusmaketheMorocco-EUgreenpartnershipmoresuccessful.PolicyStudyn.23AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegion56ReferencesAD-HOCCOMMITTEEONTHEDEVELOPMENTMODEL(CSMD).(2021,April).LeNouveauModèledeDéveloppement:Libérerlesénergiesetrestaurerlacon-fiancepouraccélérerlamarcheversleprogrèsetlaprospéritépourtous.Retrievedfromhttps://www.csmd.ma/documents/Rapport_General.pdfAFRICACLIMATESOLUTIONS(2018).Elaborationdel’étudedestructurationdel’accompagnementdudéveloppementdupompagesolaire.LivrableIIduProjetGEF-Pompagesolaire:Etatdeslieuxdumarchédepompagesolairephotovoltaïque.MOROCCANAGENCYFORENERGYEFFICIENCY(AMEE).(2014).StratégieNationaled’EfficacitéEnergétiqueàhorizon2030.Retrievedhttps://www.amee.ma/sites/default/files/inline-files/Synthese_Strategie_nationale_dEE.pdfBENNIS,A.(2021).Powersurge:HowtheEuropeanGreenDealcansucceedinMoroccoandTunisia.EuropeanCouncilonForeignRelations(ECFR).Retrievedfromhttps://ecfr.eu/publication/power-surge-how-the-european-green-deal-can-succeed-in-morocco-and-tunisia/EUROPEANCOMMISSION(EC).(2020).Communication2020/231,AhydrogenstrategyforaclimateneutralEurope.Retrievedfromhttps://ec.europa.eu/energy/sites/ener/files/hydrogen_strategy.pdfEUROPEANCOMMISSION(EC).(2021).Communication2021/550,‘Fitfor55’:deliveringtheEU’s2030ClimateTargetonthewaytoclimateneutrality.Retrievedfromhttps://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:52021DC0550&from=ENEUROPEANCOMMISSION(EC).(2022).GlobalGateway:upto€300billionfortheEuropeanUnion’sstrategytoboostsustainablelinksaroundtheworld.Retrievedfromhttps://ec.europa.eu/commission/presscorner/detail/en/ip_21_6433FOUNDATIONFORWORLDAGRICULTUREANDRURALITY(FARM).(2015).Sé-curitéalimentaireetchangementclimatiqueenMéditerranéeetAfriquedel’Ouest:Quelagendad’actionpourlaCOP21?HIGHERPLANNINGCOMMISSION(HCP).(2020).Rapportnational2020surlamiseenœuvreparleRoyaumeduMarocdesobjectifsdedéveloppementdurable.https://www.hcp.ma/Rapport-National-2020-sur-la-mise-en-oeuvre-par-le-Royaume-duMaroc-des-Objectifs-de-Developpement-Durable_a2592.htmlLAMRANI,F.Z.,&BAUMAN,B.(2021).NouvelessordesénergiesrenouvelablesauMarocgrâceàl’hydrogènevert?HeinrichBöllStiftung.Retrievedfromhttps://ma.boell.org/fr/2021/04/22/nouvel-essor-des-energies-renouvelables-au-maroc-grace-lhydrogene-vert57AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegionLAOUINA,A.(2006).ProspectiveMaroc2030:Gestiondurabledesressourcesna-turellesetdelabiodiversitéauMaroc.HigherPlanningCommission.Retrievedfromhttps://www.hcp.ma/Gestion-durable-des-ressources-naturelles-et-de-la-biodiversite-au-Maroc_a845.htmlLORCA,A.,&DEARCE,R.(2012).Renewableenergiesandsustainabledevel-opmentintheMediterranean:MoroccoandtheMediterraneanSolarPlan(MSP).Euro-MediterranenaForumofInstitutesofEconomicSciences(FEMISE).MINISTRYOFAGRICULTURE,MARITIMEFISHERIES,RURALDEVELOPMENTANDWATERANDFORESTS(MAPMDREF).(2021a).LePlanMarocVert:BilanetImpacts2008-2018.Retrievedfromhttps://www.agriculture.gov.ma/fr/publicationsMINISTRYOFAGRICULTURE,MARITIMEFISHERIES,RURALDEVELOPMENTANDWATERANDFORESTS(MAPMDREF).(2021b).GénérationGreen2020-2030:Placerl’agriculturemarocainedansunenouvelleèredeprogrès.Retrievedfromhttps://www.agriculture.gov.ma/fr/ministere/generation-green-2020-2030MINISTRYOFENERGYTRANSITIONANDSUSTAINABLEDEVELOPMENT(MTEDD).(2021a).ProjetdeStratégieNationaledeDéveloppementDurable2030.RapportFinal.Retrievedfromhttps://www.environnement.gov.ma/fr/strategies-et-pro-grammes/snddMINISTRYOFENERGYTRANSITIONANDSUSTAINABLEDEVELOPMENT(MTEDD).(2021b).StratégiedesénergiesrenouvelablesauMaroc.Retrievedfromhttps://www.mem.gov.ma/Pages/secteur.aspx?e=2MINISTRYOFENERGYTRANSITIONANDSUSTAINABLEDEVELOPMENT(METDD).(2021c).Programmenationaldelapromotiondupompagesolairedansl’irrigation.Retrievedfromhttps://www.mem.gov.ma/Pages/secteur.aspx?e=3&prj=39MINISTRYOFENERGYTRANSITIONANDSUSTAINABLEDEVELOPMENT(METDD).(2021d).Stratégienationaledel’hydrogènevert.Retrievedfromhttps://www.mem.gov.ma/Pages/actualite.aspx?act=278MINISTRYOFENERGYTRANSITIONANDSUSTAINABLEDEVELOPMENT(METDD).(2021e).ContributionDéterminéeauniveauNational-Actualisée.ORGANISATIONFORECONOMICCO-OPERATIONANDDEVELOPMENT(OECED).(2021).RegionalintegrationintheUnionfortheMediterranean:Progressreport.UNITEDNATIONSENVIRONMENTPROGRAMME(UNEP).(1972).ReportoftheUnitedNationsconferenceonthehumanenvironment.Retrievedfromfile:///C:/Users/jbelaid/Downloads/A_CONF.48_14_Rev.1-EN.pdfTOUMI,L.(2016).SustainablefoodsecurityinMorocco:Challenges&opportun-ities.AGROFORInternationalJournal,1(1),30-40.IsGreenMENAPossible?ProspectsforOilProducingCountriesAzizaMoneerPhD,FulbrightVisitingFellowtoNewHampshireUniversity,DepartmentofPoliticalScience59AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegionIntroductionAddressingclimatechangeandencour-agingrigorousclimateactionareattheheartoftheEuropeanUnion(EU)’sex-ternalrelationsefforts(Patrick,2021).AlthoughtheEUproducesonlyabout8%ofcurrentinternationalgreengasemissions,intermsofcumulativecon-tributiontogreenhousegas(GHG)emissionstheEUisthesecondlargestemitterwith17%followingtheUnitedStatesofAmerica(USA)with20%(Rochaetal.,2015).Butasahugemarketthataccountsforaround14%oftheglobaltradeingoods(Eurostat,2021),theEUholdsregulatorypowersandharnessestechnologicalad-vancesthatcanleadtoacarbon-neutraleconomy(Erlanger&Sengupta,2021).In2019,theEUannounceditspromising,yetchallenging,EUGreenDealasaroadmaptocurbthecontinent’scarbonemissionstoatleast55%below1990slevelsby2030andachievea“net-zero”orclimate-neutralcontinentby2050(Ben-nis,2021).AnothervitalgoaloftheEuro-peanGreenDealistoenforcetheEU’sgloballeadershipandtouseitsgeo-economicsandregulatorytoolsinordertoaddressthegeopoliticalspillovereffectsofitsdecarbonisationschemes,particularlyintheneighbouringcountries(Bennis,2021;Goldthau,2021).OneofthesespillovereffectsisthedecreasingneedforoilandgasfromtheEUsuppliersintheMENAregion,whichrelyheavilyonfossilfuelrevenues(Leonardetal.,2021).Actually,whiletheoilproductionwithintheEUhasdeclinedby46%since2000,theoveralldemandforoiloverthesameperiodhasstabilisedandtheEUwillcontinuetorelyonimportstomeetthisdemandatleastforthenextfewdecades(CambridgeEconometrics,2020).Onaverage,hydrocarbonexportsstillmakeupalmosttwothirdsoftotalMiddleEastandNorthAfrica(MENA)exportsandaround40%ofGDP,particularlyintheoil-exportingcountries(Bianco,2021;Dabrowski&Domínguez-Jiménez,2021).Forexample,theSaudieconomyisheavilyreliantontheoilindustry(Abdulwahab,2021)asoilexportsaccountedfor77%oftotalSaudiexportsin2019,and68%ofitsexportsin2020.Theoilrevenuesrepresented24.4%and20.5%ofthegrossdomesticproduct(GDP)inSaudiArabiain2019and2020,respectively(WorldBank,2021).TheUnitedArabEmirates(UAE)haslesshydrocarbonreservesthanSaudiArabiaandamorediversifiedeconomy,but30%ofitseconomicrevenuesisstilldirectlylinkedtopetroleumproducts(Whiteaker,2021).Therefore,thereisastrongcor-relationbetweenoilpricechangeandthefiscalbalancesintheGulfCooperationCouncil(GCC)whichhascausedincon-sistentandvolatileeconomicgrowthoverthepastfewdecades(Sim,2020).Thesameappliesformajornaturalgasex-porterslikeQatarandAlgeria,whosenaturalgasexportsformedasignificantpartoftheirGDPin2014.Thesenumbershavebarelychangedinthewakeofthe2014-2016oilpricecollapse(AlShamalietal.,2019).Similarly,inspiteofCOVID-19andtherelatedeconomicrecessionandshrinkinghydrocarbonsector(Da-browski&Domínguez-Jiménez,2021),thehydrocarbonsectorcontinuedtoaccountfor94%ofexportearningsinAlgeriain2019and82%ofexportearningsinQatarin2020(WorldBank,2021).Intheserentierstates,thesocialcontractisbasedon“notaxationandnorepre-sentation”(Woertz,2021),wheretheroleofthegovernmentbecomesprovidingprivatefavoursthroughtheruler’sbenev-olenceandthepoliticallegitimacyisen-Source:CompiledbytheauthorbasedondatafromBP(2021)Source:WorldBank(2021)suredwithpublicsectorjobsandsocialwelfareprogrammes(Tagliapietra,2018).Inthisregard,hydrocarbonrevenueshavebeentypicallyemployedtofinancejobsforcitizens,andmorethanhalfofthemareworkinginthepublicsectorintheGCCstatescomparedtoaninternationalrateof10-20%(Sim,2020).Inaddition,inlightofthepro-cyclicalfiscalpoliciesintherentierstatesandtheheavyrelianceoftheprivatesectoronstatespending(Sim,2020),theprivateagentsusuallyinvestineithertherentierornon-rentiersectorbasedonexpectedprofitabilityandtheruler’sapproval,whichhindereconomicdiversification(Kayaetal.,2019).PolicyStudyn.23AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegion60CountrySaudiArabiaIranIraqUnitedArabEmiratesKuwaitQatarAlgeriaOmanLibyaEgyptTunisiaTotalregionalproductionOil(thousandbarrelsperday)11,0393,0844,1143,6572,6861,8091,3329513906163627,664Table1.HydrocarbonproductionintheMENAcountriesbytheendof2020CountryIranQatarSaudiArabiaUnitedArabEmiratesAlgeriaOmanEgyptBaharinKuwaitLibyaIraqTotalregionalproductionNaturalgas(billioncubicmetresperyear)250.8171.3112.155.481.558.536.916.415.013.310.5686.6CountryAlgeriaBahrainEgyptIranIraqKuwaitLibyaOmanQatarSaudiArabiaUnitedArabEmirates201424.48.68.226.345.655.24239.630.541.224.2Table2.OilrentsinMENAcountriesfrom2014to2019201515.95.13.715.635.13828.523.819.924.2142016123.22.712.931.432.122.319.715.319.911.3201714.53.54.8173837.138.423.41823.713.7201815.62.45.620.444.844.142.526.717.328.916.6201914.42.24.020.439.642.143.924.916.924.216.261AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegionThedegreetowhichfossilfuel-exportingcountriesintheMENAregionwillbeaf-fectedbytheEUGreenDealwillbedif-ferentaccordingtomultiplefactors,suchascountries’break-evenoilprice,theEUmarketshareintheirfossilfuelexports,andtheavailableoilandgasinfrastructure(Quadri,2021).TheEUGreenDealdoesnotimplythatoilandgaswillbeimmediatelyphasedout.Itisexpectedthat–evenwithfollowingthemoststringentdecarbon-isationpaths–fossilfuelwillcontinuetobepartoftheglobalenergymixatleastforthenextfewdecades,albeitatalowerlevelthancurrentdemandtrends(Johnstonetal.,2020).AccordingtotheInternationalEnergyAgency(IEA)(2021),theSus-tainableDevelopmentScenario(SDS)foreseesthatadvancedeconomieswillreachnet-zeroemissionsby2050,Chinaby2060,andallothercountriesby2070atthelatest.However,oildemandintheSDSincreaseswithinthecomingfewyearsandthendeclinestoabout50millionbarrelsperday(mb/d)in2050incomparisonwith97mb/dtoday.Thismeansthatoveralloildemanddeclinesby2%everyyearbetween2018and2050(IEA,2019).Demandfornaturalgasfluttersaround4,000billioncubicmetresbytheendof2030s,andthensignificantlydeclines.Coaldemandwillbealmostphasedoutfromtheenergymixtoreachonly8%ofthetotalenergyuseby2050(IEA,2019).Accordingtothescenariodescribedabove,itisexpectedthatglobalenergydemandwillcontinuetoincreaseby1%peryearuntil2040.Thisgrowthistriggeredbyanincreasingpopulation(9billionpeopleby2040),robusteconomicactivities,andanestimatedincreaseintheglobalGDPby3.5%peryear(Evans,2019).However,thegrowthrateofenergydemanduntil2040willbearoundhalftheaveragerateof2%achievedsincethe2000s,andalmosthalfofthedemandgrowthwillbemetbyrenewables(Evans,2019).Thisshiftinenergydemandisassociatedwithefficiencyimprovements,electrification,in-vestmentinrenewablesandnewlow-carbontechnologiesandshiftstowardslessenergy-intensiveindustries(EIA,2019).Thelikelihoodoftheseshiftsintheglobalenergysector,ontheonehand,isnotamerequestionoftechnologybutiscloselyrelatedtothegovernments’willingnesstoprovidepolicyframeworksthatenableanacceleratedenergytransitionandfacilitatemorediversifiedeconomies,particularlyintheoil-exportingcountries,suchasthoseintheMENAregion(Leonardetal.,2021).Ontheotherhand,theEU’senergydiplo-macywillneedtoaddressthewideandprofoundgeo-economicandgeopoliticalramificationsresultingfromtheenergytran-sition.Inthisregard,theEUshouldreviewtheexistingsetofprioritiesinconcertwiththeemergingchallengesanddiversifyitsinstrumenttoolbox,avoidinganormative-ideologicalperspectiveinfavourofarealisticandcountry-tailoredapproach(Pastukhovaetal.,2020).ThischapteraddressestheimpactsoftheEUGreenDealonthefossilfuelexportingcountriesintheMENAregion,focusingonAlgeria,SaudiArabia,theUnitedArabEmirates(UAE)andQatar.Inparticularitexaminestwomainissues:theEUGreenDeal’srepercussionsforthesecountriesandhowtheEUpoliciesandactionscanbeframedinordertoalleviatepossiblenegativeimpactsinthesecountries.AlgeriaAlgeriahasthe10thlargestknownnaturalgasreserves,istheworld’ssixth-largestgasexporter,andhastheworld’sthird-largestuntappedshalegasresources(ITA,2021).In2020,Algeriaflaredsome9.3bcm,makingitthefifthlargestflarerThedegreetowhichfossilfuel-exportingcountriesintheMENAregionwillbeaffectedbytheEUGreenDealwillbedifferentaccordingtomultiplefactorsPolicyStudyn.23AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegion62intheworld,andexported35%ofitstotalcrudeoilproductiontotheEU(Cap-terio,2021).Hydrocarbonrevenuesrep-resent95%ofitsexportsbyvalue,ac-countingfor60%ofitsGDP,andthecountryisreliantontheEUforitshydro-carbonrevenues(Leonardetal.,2021).TheexpecteddeclineinoilandgasexportstotheEUandtherelatedreducedhydrocarbonrevenuesrepresentaseriousthreattotheeconomicstabilityandsocialresilienceofthecountry(Grigorjeva,2016)andacriticalchallengeforthefor-eignpolicyaspectoftheGreenDeal(Teevanetal.,2021).Accordingtoare-spondentfromtheAlgerianEnergyMin-istry,givenAlgeria’shydrocarbonre-sources,developingdownstreamhydro-carbonproductsisaviableandpromisingwaytodiversifytheeconomy.Inaddition,electrificationisoneoftheEUGreenDealaspectsandthereisahugepotentialforsolarandwindelectricityimportsfromAlgeriatoEurope.Giventheanticipatedchallengesanddecarbonisationprocessunderway,thefocusofenergysecuritywillrevolvearoundelectricityandlowandcarbon-neutralfuels,aswellastherawmaterialscentralforthemanufactureofstorageandrenewableenergytech-nologies(Pastukhovaetal.,2020).Ac-cordingtoTeevanetal.(2021),theEUwillneedtosupportamorediversifiedeconomyinAlgeria,aswellasusingitsowndomesticmodelofgreentechnologyleadershiptodeployinvestmentinlarge-scalesolarandgreenhydrogenprojectsinAlgeria.TheEU’seffortstofacilitateenergytran-sitioninitsSouthernMediterraneanneigh-bourcountriesincludingAlgeriaareemphasisedbymultiplebilateralandmulti-lateralinstrumentstopromotestrategicenergypartnershipsandadvanceenergyefficiencyandrenewables(Weber,2014).ExamplesofthesemultilateralinitiativesincludetheEuro-MediterraneanEnergyForumintheframeworkoftheEuro-Medi-terraneanPartnership(EMP),theAssoci-ationofMediterraneanEnergyRegulators(Medreg),theUnionfortheMediterranean(UfM),theAssociationoftheMediterra-neanTransmissionSystemOperators(TSOs)forelectricity,andtheMediterra-neanSolarPlan(MSP)(Prontera,2019).TheseinitiativessharedthecommongoalsofpromotingtheEUregulatoryframeworkandadvanceenergyinfrastructureandtechnologiesbetweenthetwoshoresoftheMediterraneaninawaythatstrengthensenergydiplomacycapacities(Goldthau&Sitter,2015)AnotherimportantpoliticaltoolistheEU’sfinancialassistance,whichischan-nelledthroughvariousmechanisms,suchasbilateralfinancialassistance,Neigh-bourhoodInvestmentFacilityProgrammes,andTwinningandThematicProgrammes(Tichýetal.,2020).From2014-2020,theEuropeanNeighbourhoodandPart-nershipInstrument(ENPI)provided€241.3milliontoAlgeria,whereenergyandclimateactionprojectswereallocatedacentralportionofthisfunding(EC,2021).Asof2017,theEuropeanInvest-mentBank(EIB)hasinvested€2.1billioninAlgeriainsupportofprojectsintheenergy,water,roadtransportandindustrysectors(EIB,2017).Forinstance,theMaghreb-Europegaspipelineproject,in-auguratedin1996,wasconstructedwiththeassistanceof$1.1billionfromtheEIBtotransportgasfromAlgeriatoSpainandPortugal,passingthroughMorocco(Goff,2021).DespitethegreatpotentialofAlgeriaforenergypartnershipwiththeEU,previousattemptstoestablisharenewableenergypartnershipfailed.Forexample,theDe-sertecIndustrialInitiative(DII)waslaunchedin2009asnewmegatechnicEU-MENArenewableenergywiththepurposeofmeetingabout20%ofEu-GivenAlgeria’shydrocarbonresources,developingdownstreamhydrocarbonproductsisaviableandpromisingwaytodiversifytheeconomy63AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegionrope’selectricityneedsby2050throughanetworkofsolarandwindfarmsex-tendingthroughtheMENAregionandtocontributetoitselectricityself-sufficiency(Schmitt,2018).However,theDIIwasperceivedasanasymmetricalprojectthataimedtoprovidefortheenergyneedsoftheEUbyensuringtheflowofcheapenergyresourcesfromtheGlobalSouthtotherichindustrialisedNorth,whilemaintainingaprofoundlyunjustinter-nationaldivisionoflabour(Hamouchene,2015).AccordingtoAllanetal.,(2021),theDIIfailednotonlybecauseofitsfi-nancialinfeasibilitybutalsobecauseitwasperceivednegatively.Inthisregard,Hamouchene(2015)stated:“ThiswasagenuineconcerngiventhelanguageusedindifferentarticlesandpublicationsdescribingthepotentialoftheSaharainpoweringthewholeworld.TheSaharaisdescribedasavastemptyland,sparselypopulated;constitutingagoldenopportunitytoprovideEuropewithelectricitysoitcancontinueitsextravagantconsumer-istlifestyleandprofligateenergycon-sumption.”Inaddition,theDIIdidnotperceivethelocalcommunityintheSaharaasanactiveactorinthedecision-makingprocess;rathertheywereaddressedaspassiveconsultees.Furthermore,theunintendedenvironmentalimpactsoftheDIIraisedsignificantcon-cerns,particularlyinrelationtousingwaterinanalreadywater-scarceregiontocoolsolarpowerplants(Allanetal.,2021).Inthisregard,AlgeriahasbeencriticisingtheEurocentricityandunilateralityofEUinitiativesinrelationtoenergypartnerships,perceivingthiskindofpartnershipasawayoftakingadvantageofitscheapnaturalresources,ratherthanbeingperceivedasawin-winsituation(Tichyetal.,2020).AlgeriawillbeacriticaltestcasefortheEUclimateobjectives,particularlywiththeapprovalofthenationalplanfortheproductionofgreenhydrogenbytheAl-geriangovernmentinMay2021.TheplanaimstoexportgreenhydrogeninsteadofnaturalgastoSpainandItalystartingin2030(Cherif,2021).ThishydrogentransitionhasthepotentialtoachievethedualgoalsoftheEUGreenDeal,toad-vanceclimateactionandtohelpfossilfuel-exportingneighbouringcountriesincludingAlgeriatodiversifytheirecon-omyandrevenuesources(Wijketal.,2020).Accordingtooneoftherespon-dentswhoworkattheMinistryofEnergyandMininginAlgeria,adifferentapproachisneededtorealisesustainableandstra-tegicenergycollaborationbetweentheEUandNorthAfrica,anapproachthatisnotonlyfacilitatingcheaperandfeasibleenergysystemsbutalsoareliableandfairone.Headded:“TheEU-NorthAfricapartnershipincleanenergyproductionshouldcounteranyneo-colonialismac-cusations.Thecooperationneedstobebasedonmutualbenefits,ensuringthatelectricitywillbeavailableforthepeopleofNorthAfricabeforeexportingtheenergytoEurope.Inaddition,thereisapressingneedtoensuretheflowofknow-howanddiffusionoflowcarbontechnologiesbetweentheEUandNorthAfricainordertoreplicatesuccessfulmodelsofcleanenergysystemsandintegratethemintolocaltechnologies.”GulfRegionTheGCCcountries–Bahrain,Kuwait,Oman,Qatar,theUAEandSaudiArabia–ownhalfoftheprovenoilreservesintheworldandareamongtheworld’slar-gestoil-exportingcountries(Bolanos,2016).Despitethedecarbonisationpro-cessandanticipatedshrinkingdemandforoilandgas,theGulfregionisexpectedtocontinueprovidingathirdofdailyoilde-mand,particularlyformarketssuchasIndiaAlgeriawillbeacriticaltestcasefortheEUclimateobjectives,particularlywiththeapprovalofthenationalplanfortheproductionofgreenhydrogenPolicyStudyn.23AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegion64andChina,atleastforthenextfewdecades(Calabrese,2021).ThismeansthattheGulfregionwillcontinuetoplayasignificantroleinglobalenergysecurity(VOA,2021).TheimportanceoftheregionisalsoreflectedinthepoliticalandeconomicleveragepractisedbymajorpowerssuchasSaudiArabia,theUAEandQataroverothercountries,suchasYemen,LibyaandIraq(Quadri,2021).Fur-thermore,therecessionofpetroleumexportsandrelatedanticipatedreducedrevenuescanpotentiallyfracturethestate’slegitimacy,possiblycreatingsocialupheavalsandpoliticalinstability.ThesemanifestationswillhaverippleeffectsthatcouldspillacrossnationalborderswithconsequencesfortheEUrangingfromterrorism,proxywarsandmigration(IRENA,2019).AccordingtooneoftherespondentswhoworkattheGCC:“TheGulfcountriesdifferintheirlevelsofwillingnessandpre-parednesstoinitiateandpursueenergytransition.”Headded:“TheUAEandSaudiArabiahavebeenthemostproactivestatesintheregion,formulatingpoliciestoadoptrenewablesandengagingwithinternationalandinterregionalclimatechangenegoti-ations.”SaudiArabiacommittedtoadoptnature-basedinitiativestooffsetcarbonemissions,includingtheSaudiArabiaGreenInitiativeandtheMiddleEastGreenInitiative(Kennedy,2021).Thelatteraimstooffsettheregion’scarbonemissionby60%by2030andthetwoafforestationschemesaimtoplant10billiontreesinSaudiArabiaand40milliontreesacrosstheregion,respectively(Neve,2021).SaudiArabiaSaudiArabiacommittedtobecomecar-bon-neutralinitsdomesticproductionby2060,deriving50%ofitselectricityfromrenewablesby2030andeliminatingitscarbonemissionsbyusingcleanhydro-carbonby278MTperyearby2030(Rathi,2021).AccordingtooneoftherespondentsfromtheSaudiMinistryofEnergy:“Otheractionstargetingzero-emissionsgoalincludetheestablishmentofSaudiArabia’sfirstwindfarm,Dumatal-Jandal,withacapacityof400MW,whichisplannedtoprovideelectricityto70,000Saudihomes,andtheinaugurationofthe300MWsolarprojectthatwasconnectedtoDubai’sgrid.Theprojectwillpower27,000homesandremove1.8milliontonnesofCO2peryear;andthedeclarationoftheSaudiAramcoPowerCompanytodevelop1.5GWSu-dairSolarPlant.Oncecompletedin2022,theSudairplantprovidespowerto185,000households,offsetting2.9MTofCO2.”SaudiArabiaisincreasingitshydrogencapacity,aimingtoproduce29mtonnesofblueandgreenhydrogenannuallyby2030.Inthisregard,SaudiArabiaisplanningtooperationalisethegreenhydrogeninitiativeinNEOM,themega-citydevelopmentinitiativeinnorth-westernSaudiArabia,generating4GWofwindandsolarpowerby2025(Kossaify,2021;Bianco,2021).TheUAETheUAEisanotherregionalleaderoftheenergytransition,bothdomesticallyandinitseffortstorethinkthewaysinwhichitengageswiththeglobalenergysystem(Seznec&Mosis,2021).TheUAEhasbeendiversifyingitsenergymixsincethelate2000s.In2006,theUAElaunchedMasdar,arenewableenergycompanythathastriggeredlow-carbonenergysol-utionsandclimateinvestments(Alterman,2021).However,thegovernmentfailedtofulfilitsplantobuildtheworld’sfirstzero-carboncity,Masdarcity,by2016(Bianco,2021).TheUAEhasbecomethefirstGulfcountrytocommittonet-zeroemissionsinthreedecades,asset65AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegionoutintheUAEEnergyStrategy2050(Azari,2020).The2050strategyisinalignmentwiththeUAE’sbroaderstrategyforeconomicdiversificationandadvance-mentofrenewables,generating44%ofpowerfromrenewables,6%fromnuclear,12%fromcleancoalandtherestfromnaturalgas,andreducingthecountry’scarbonfootprintfrompowergenerationby70%by2050(Saad,2021).AccordingtooneoftherespondentsfromtheAbuDhabiDepartmentofEnergy:“Despiteallthesepositiveinitiativestoacceleratetheuseofrenewables,theUAEwillcon-tinuerelyingonoilexportsrevenuesasawaytostabiliseitseconomy,meetitspublicfinancesduringtheforeseentran-sitionandtosendamessagethattheUAEwillcontinueplayingakeyroleinthedynamicsoftheglobaloilmarket,evenwhentheoildemandwilldeclineinsomepartsoftheworld.”Inthisregard,theUAEaimstotargetmarketsinemerg-ingeconomieswheredemandforoilisexpectedtoincreaseinthenextfewyears,targetingproductionof5millionbarrelsofoiladayby2030,insteadof3.5millionin2018(Krane,2021).QatarQatarhasbeentakingstepspreparingforanet-zeroemissionfuture,aimingtoestablishthelargestcarbonstorageplantintheregiontocaptureoverfivemilliontonsofCO2peryear(Al-Khater,2020).State-ownedgiantQatarPetroleum(QP)isamongthefirstGulfoilandgasgiantstorebranditselfintoadiversifiedenergycompany,emphasisingitsplantoreducecarbonemissionsintensityofitsliquefiednaturalgas(LNG)facilitiesby25%by2030(Ugal,2021).Inordertoacceleratedecarbonisationefforts,QatarjoinedSaudiArabia,NorwayandtheUSAtoin-auguratethe“Net-ZeroProducersForum”todevelopnet-zeroemissionstrategies,includingmethaneabatementandthecarboncapture,utilisationandstorage(CCUS)technologies(Neve,2021).Asapartofitscommitmenttodiversifyitseconomy,Qatarfoundedthe“OnePlanet”GlobalSovereignWealthFundasawaytoencouragegreeninvestmentandtoincorporatesustainabilityconsiderationsintoeconomicactivitiesandinvestments(Al-Khater,2020).OtherGCCcountriesOtherGCCoilproducersannouncedseveralgreeninitiativesinresponsetogreentransitionobligationsandclimatechange.Anewnationallydeterminedcon-tribution(NDC)undertheParisClimateAgreementwasdeclaredbyOmantore-duceitsCO2emissionsby7%frombusi-nessasusualby2030(Lo,2021).Iraq,theOrganizationofPetroleumExportingCountries(OPEC)’ssecond-largestoilproducer,ratifiedtheParisAgreement,aimingtoreduceitsCO2emissionby1-2%(UNDP,2021).Non-oildiversificationisamajorissueintheGCC.AnumberofGCCcountrieshavebeenactivelyen-gagedincreatingneweconomicsectorsthatcomplementandeventuallycanre-placethosecarbonintensiveeconomicactivities(Mishrif,2018).Forexample,theUAEhasbuiltdiversifiedeconomiesthatarealreadyflourishingawayfromfossilfuelrevenues(Krane,2021).OtherinitiativestodiversifyGCCeconomiesin-cludetheestablishmentofagenciesthatsupportthedevelopmentandthefinanceofsmallandmedium-sizedenterprises(SME),suchasOman’sRiyadaandQatarDevelopmentBank(Kabbani&Mimoune,2021).Inaddition,theGCCdeclaredfreetradezonesandspecialeconomiczonesthathavetheirownregulationsandbylawsawayfromtheregulatorydistortionoftheprivatesector(Kabbani&Mimoune,2021),creatingabusinessclimatethatisabletoattractandstimulatenationalandinter-nationalinvestment(Tagliapietra,2018).TheUAEaimstotargetmarketsinemergingeconomieswheredemandforoilisexpectedtoincreaseinthenextfewyearsPolicyStudyn.23AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegion66Inthisregard,asof2018,theUAEhad46freetradezones(FTZ)andwascloselyfollowedbySaudiArabiawith28zonesintheGCC(Puri-Mirza,2021).WhileGCCstateshaveattainedpartoftheireconomicdiversificationgoals,pe-troleumproductscontinuetorepresentover40%ofGDPinmostGCCcountries,exceptfortheUAE(30%)andBahrain(18%)(Kabbani&Mimoune,2021).Inotheroilexportercountries,suchasQatar,AlgeriaandBahrain,activitiesinthenon-oilsectorarecloselyrelatedtotheoilandgassectors.Thefossilfuel-basedin-dustriesandlinkedvaluechainstendtoincluderefinery,chemicalandotherextrac-tiveindustries,whilesomenon-oilsectors,suchasconstructionandinfrastructure,areheavilyfundedfromoilandgasrev-enues(Tagliapietra,2018).Evenincoun-trieslikeBahrain,whereoilreserveshavelargelybeendepletedanddonotrepresentabigshareofGDP,oilstillfinancestheeconomyindirectlythroughmoneytransfersofworkersinneighbouringoilrichcountries(Kabbani&Mimoune,2021).Therefore,thelargesthurdletodiversifi-cationistheheavyrelianceoneconomicrentsderivedfromtheoilandgassectorsintheGCC(Krane,2021).Underthispremise,pursuingdiversificationhasshort-termrisksandchallenges,no-tablyinrelationtoemployment,fiscalrev-enuesandGDP(Robinsonetal.,2021).Theseproblemsarefurtherexacerbatedbythefactthatfossilfuelexportrevenuesareusuallyallocatedpoliticallyviapa-tronagetofinancepaidpublicsectorjobsandintheformofinefficientsubsidiesratherthanfinanciallysupportingdiversifiedeconomicgrowth(Peszkoetal.,2021).TheInternationalEnergyAgency(IEA)predictsthateconomiesthatrelyonoilandgascouldlose$7trillionby2040withthedeclineintheoilprice(Tänzler&Gordon,2020).AccordingtooneoftherespondentsfromtheSaudiInvestmentMinistry:“Evenwithfullsubstitutionofthefossilfuelandrelatedindustrieswithnon-oilindustries,significantfiscaldeficitintheGCCgov-ernments’budgetswillpersist.Therefore,GCCcountriesshouldintroducestructuralreformsintwomainareas:firstisthecompositionofthenationalenergymixandsecondisthecarbon-intensityoftheirhydrocarbonsectors.”EventhoughmanyoilrichGCCstatesareinvestinginlow-carbontechnologiesinordertoreducethecarbonintensityoftheirpetroleumproducts,thesheersizeofpetroleumexportsoftheGulfstatesremainsatthesamelevelastheircounter-partsofinternationalandoilandgascompanies(Seznec&Mosis,2021),giventheplanoftheEUtoimposeaCarbonBorderAdjustmentMechanism(CBAM).Simplyput,itisalevythatwouldaddthecarbonemissioncoststoimportsofgoodswhentheycrossthebordersintotheEU(Appunn,2021).Thistaxwouldcreatesignificantchallengesforoilexportsandotherindustrieswithalargecarbonfootprint(Tänzler&Gordon,2020).Im-portantly,thecarbonbordertaxwillrewritethetermsofthecompetitivelandscape,puttingmoreconstraintsonthecarbon-intensivepetroleumimports,representinganewsourceofdisruptiontoaglobaltradingsystemalreadyroiledbytariffwars,renegotiatedtradeagreementsandrisingprotectionism(Ayloretal.,2020).Solutionstothischallengeincludeinno-vativecollaborativemechanisms,suchaswellheadtaxesandpreferentialtradeagreementsandtechnologytransfers(Peszkoetal.,2020).Theseorganisedandcoherentapproachestodomesticenergytransitionscouldincentivisebusi-nessestoreducetheirCO2emissions,andalsoprovideforamorecomprehensivestructuralandjusttransition,particularlyinoil-dependentstatesintheGulfregionThesheersizeofpetroleumexportsoftheGulfstatesremainsatthesamelevelastheircounterpartsofinternationalandoilandgascompanies67AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegion–ratherthanaretail,patchyandproject-basedapproach(Peszkoetal.,2020).PolicyrecommendationandthewayforwardTheenergytransitionwilldrasticallyreducehydrocarbonrevenues,particularlyinthefossilfuel-exportingcountriesintheMENAregionafter2030.Accordingly,therewillbeknock-oneffectsontheeconomiesandpoliticsofrentierstatesintheMENAregion,whichmayleadtosocialunrest,politicalinstability,orevenstatefailure.Thelattercouldresultinviolenceand/ormigrationwavestoneighbouringcountiesintheEU(Bartuskaetal.,2019).However,itisunlikelythattheincreasingdeploymentoflow-carbonenergyprojectsintheGulfwillenableittocounteracttheadverseimpactsofreducedhydrocarbonrevenuesonjobs,economicgrowthandtheprivatesector(Sim,2019).Asnotallfossilfuelexportingcountrieswillbeaffectedinthesamewayandtheyhavereacheddif-ferentlevelsintheirpursuitstowardscar-bon-neutraldevelopment,theEUwillneedexplicit,country-specificpoliciesandanalysesforeachstatetoanticipateandprepareforpossiblerisks(Bartuskaetal.,2019).TheEUalreadyhasplentyofinternalmechanismstopromotegreeninnovationinresearchanddevelopmentamongtheEUstates.Forexample,theEUInnovationFundprovidesfinanceacrossallmemberstatestosupportinnovationinlow-carbontechnologiesandprocesses.51However,thesemechanismscouldbeusedtogiveexternalsupportfornon-Europeanpartnersintheareasofregula-toryandtechnologicalinnovation.Forexample,FrancecouldbuildapartnershipwithAlgeriadevelopingphotovoltaictech-nologytogeneratesolarenergy(Dennisonetal.,2020).GiventheambitiousplansoftheindustryassociationHydrogenEu-ropetoimportthehydrogenequivalentof40GWofelectrolysersby2030(Er-bach&Jensen,2021),theGCCcountriesholdgreatpotentialasacheapgreenhydrogenexportertotheEU(QamarEnergy,2020).However,acollaborativeregulatoryframeworkforgreenhydrogentradeandotherpolicymeasuresrelatedtotechnologytransfer,financingandcer-tificationshouldbenegotiatedtofacilitatebilateraltradingagreementsfollowedbyaliquidmarketbetweenthemajorEUandnon-EuropeanH2exporters.Asmentioned,theEUplanstoimposetheCBAMoncarbon-intensiveimportsasawaytointernalisethecostsofclimatechangeintopricesofgoodsandservices(Prazeres&Xie,2021).TheCBAMisconsideredaclimatepolicymeasurethataimstoensurethatclimateactioninEu-ropedoesnotleadtocarbonleakages(PwC,2021).Carbonleakagesoccurwhendomesticindustriespushtheircar-bon-intensiveactivitiestoregionswithlaxemissionrulesorwhenformerlydo-mestically-producedgoodsarereplacedbymorecarbon-intensiveimports(Appunn,2021).WhenthetaxisfullyimplementedinJanuary2026,oneofitsbiggestimpactswillbeonthefossilfuelexportingcountriesintheMENAregionthatwillpotentiallytargetothermarketswithlowerambitionsforemissionsreduction(Ianchovichina&Onder,2021).InordertoensuretheCBAMasawaytoboostclimateaction,moreeffortsareneededtodesignonethatworksforallcountries.Forexample,bordertaxesshouldbeaccompaniedbyotherincen-tives,suchasequivalentreductionin51https://ec.europa.eu/clima/eu-action/funding-climate-action/innovation-fund_frPolicyStudyn.23AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegion68othertariffsornontarifftradebarrierspar-ticularlyforlow-intensivecarbonproductsorindustries(Ianchovichina&Onder,2021).Inaddition,theEUcouldadoptothermeasures,suchascleantechnologytransfer,capacity-buildingorfinancialsupportforlow-intensiveindustries,particularlyintheleastdevelopedcountries(Langrand,2021).TheEUhasakeyroleinadvancinggreenenergytechnologiesinareasofgreenhydrogentransportation,batteriesandstor-agetechnologies,carboncapture,low-carbontransport,digitisedenergysystems,cross-borderpowergridinterconnectionsandnew“gridcommunities”,andnewin-dustrialrevolution(industry4.0)(Pastukhovaetal.,2020;Clarketal.,2020).However,untiltoday,technologytransferandthedisseminationofinnovationhavebeendominatedbylinearmodelsratherthanbeingapproachedthroughsystematichol-isticmodesofknowledgesharing.Thepersistentuseoftheterm“technologytransfer”insteadof“technologysharing”reflectsthegapbetween“technologyin-novators”intheGlobalNorthand“tech-nologyconsumers”intheGlobalSouth(Uramaetal.,2012).InordertoadoptamodelofknowledgesharingbetweenEUanditsneighbour-hoodcountriesintheGlobalSouth,itisessentialtoensurenotonlyhardwareex-change,butalsohowtoenablethere-cipientcountriestoutilise,maintainandreplicatethistechnology(Kirchherr&Urban,2018).Inthisregard,thereareaspectsthatneedattention:assessandprioritisetechnologyneedsintherecipientcountries;buildthecapacityofthelocallabourforcetouse,disseminateandmaintainthesegreentechnologies;anddevelopthepolicyframeworksandmarketconditionsfortheinvestmentinandutil-isationandregulationoftechnology(Uramaetal.,2021).Knowledgesharingrequiresstrategicpartnershipstobebuiltwiththedifferentstakeholdersinthevaluechain,startingfromtechnologydesignationthroughdevelopmentanddeployment,endingwithevaluationandreadjustment.Inaddition,thereisaneedtotakeintoconsiderationthepotentialclimatechangemitigationtechnologiesintheneighbouringcountries’localcommunitiesandintegratethemwithtechnologicaladvancesandinnovationintheGlobalNorth(Uramaetal.,2021).Thepersistentuseoftheterm“technologytransfer”insteadof“technologysharing”reflectsthegapbetween“technologyinnovators”intheGlobalNorthand“technologyconsumers”intheGlobalSouth69AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegionReferencesABDULWAHAB,S.(2021).Thelinkagebetweenoilandnon-oilGDPinSaudiArabia.Economies,9(4).Retrievedfromhttps://www.mdpi.com/2227-7099/9/4/202/htmAL-KHATER,L.R.(2020,September30).Smallstatesandclimatechange:ThecaseofQatar.WilsonCenter.Retrievedfromhttps://diplomacy21-adelphi.wilsoncenter.org/article/small-states-and-climate-change-case-qatarALSHAMALI,A.,EL-ISSA,B.,ELMADDAH,E.,MANSOUR,I.H.,ROUABHIA,I.,ALTHOBHANI,K.,ELSAIM,N.,FAWAZ,S.,ALHARTHEY,S.,ABUSERRIYA,S.,&AL-ZOGHOUL,S.(2019).EnergyandclimateintheMENAregion.Youthperspectivetoasustainablefuture.Retrievedfromhttp://library.fes.de/pdf-files/bueros/amman/15777.pdfALTERMAN,J.B.(2021,August9).AnewrevolutionintheMiddleEast.CenterforStrategicandInternationalStudies(CSIS).Retrievedfromhttps://www.csis.org/analysis/new-revolution-middle-east-0APPUNN,K.(2021,July23).Emissionreductionpanaceaorrecipefortradewar?TheEU’scarbonbordertaxdebate.CleanEnergyWire.Retrievedfromhttps://www.cleanenergywire.org/factsheets/emission-reduction-panacea-or-recipe-trade-war-eus-carbon-border-tax-debateAYLOR,B.,GILBERT,M.,LANG,N.,MCADOO,M.,OBERG,J.,PIEPER,C.,SUDMEIJER,B.,&VOIGT,N.(2020,June30).HowanEUcarbonbordertaxcouldjoltworldtrade.BostonConsultingGroup.Retrievedfromhttps://www.bcg.com/publications/2020/how-an-eu-carbon-border-tax-could-jolt-world-tradeAZARI,A.A.(2020,September24).HowdidtheUAEmanageitsrenewableenergyinvestmentsduringCOVID?.BostonUniversityInstituteforSustainableEnergy.Retrievedfromhttps://www.bu.edu/ise/2020/09/24/how-did-the-uae-manage-its-renewable-energy-investments-during-covid/BIANCO,C.(2021).Powerplay:Europe’sclimatediplomacyintheGulf.EuropeanCouncilofForeignRelations.BARTUSKA,V.,LANG,P.,&NOSKO,A.(2019).ThegeopoliticsofenergysecurityinEurope.CarnegieEurope.Retrievedfromhttps://carnegieeurope.eu/2019/11/28/geopolitics-of-energy-security-in-europe-pub-80423BENNIS,A.(2021).Powersurge:HowtheEuropeanGreenDealcansucceedinMoroccoandTunisia.EuropeanCouncilonForeignRelations(ECFR).Retrievedfromhttps://ecfr.eu/publication/power-surge-how-the-european-green-deal-can-succeed-in-morocco-and-tunisia/BOLANOS,J.(2016).TheGulfregionandthefutureofoil.Retrievedfromhttps://www.kas.de/c/document_library/get_file?uuid=f66f6674-4ee9-b9f9-351a-f3b65b4e00e1&groupId=252038PolicyStudyn.23AnticipatingandMitigatingSideEffects:TheRoadtoaSuccessfulGreenTransitionintheEuro-MediterraneanRegion70BP(20201).bpStatisticalReviewofWorldEnergy2021.Retrievedfromhttps://www.bp.com/content/dam/bp/business-sites/en/global/corporate/pdfs/energy-economics/statistical-review/bp-stats-review-2021-full-report.pdfCALABRESE,J.(2021).MiddleEast-AsiaPacificoilrelations:Fromthepandemictopeakoil.MiddleEastInstitute.Retrievedfromhttps://www.mei.edu/publications/middle-east-asia-pacific-oil-relations-pandemic-peak-oilCAMBRIDGEECONOMETRICS(2020).AstudyforTransport&Environment:OildependencyintheEU.Retrievedfromhttps://www.transportenvironment.org/wp-content/uploads/2021/07/2020_CE_Oil_Dependency_in_EU_report.pdfCAPTERIO(2021).GasflaringthreatensAlgeria’senergyexportstoEurope.Retrievedfromhttps://capterio.com/insights/gas-flaring-threatens-algerias-energy-exports-to-europeCHERIF,S.(2021,November18).Energytransition:Algeriagoesgreen.ArabNews.Retrievedfromhttps://www.arabnews.com/node/1970821/middle-eastDABROWSKI,M.,&DOMÍNGUEZ-JIMÉNEZ,M.(2021).EconomiccrisisintheMiddleEastandNorthAfrica.Bruegel.Retrievedfromhttps://www.bruegel.org/wp-content/uploads/2021/01/PC-02-2021-220121.pdfDENNISON,S.,LOSS,R.,&SÖDERSTRÖM,J.(2020).Europe’sgreenmoment:Howtomeettheclimatechallenge.EuropeanCouncilonForeignRelations.Retrievedfromhttps://ecfr.eu/publication/europes-green-moment-how-to-meet-the-climate-challenge/ERBACH,G.,&JENSEN,L.(2021).EUhydrogenpolicy.Hydrogenasanenergycarrierforaclimate-neutraleconomy.EuropeanParliamentaryResearchService.Retrievedfromhttps://www.europarl.europa.eu/RegData/etudes/BRIE/2021/689332/EPRS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