EU climate nominee Maros Sefcovic has been portrayed by some MEPs as being influenced by internal politics in his home country Slovakia. EPA
EU climate nominee Maros Sefcovic has been portrayed by some MEPs as being influenced by internal politics in his home country Slovakia. EPA
EU climate nominee Maros Sefcovic has been portrayed by some MEPs as being influenced by internal politics in his home country Slovakia. EPA
EU climate nominee Maros Sefcovic has been portrayed by some MEPs as being influenced by internal politics in his home country Slovakia. EPA

EU proposed green deal chief questioned about his support for Ukraine


Sunniva Rose
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European politicians on Tuesday questioned Maros Sefcovic, the proposed EU green deal chief, about his views on Russia after a pro-Kremlin candidate won a general election in his home country Slovakia.

Slovakia accused Moscow of interfering in its election at the weekend that was won by populist Robert Fico, who pledged to end military help for Ukraine.

The dispute came as a European Parliament committee on Monday postponed a decision on whether to accept former Dutch foreign minister Wopke Hoekstra as the EU's new climate change policy chief, after he sought their backing in a three-hour hearing.

The decision on Mr Hoekstra, a centre-right conservative, is now due on Tuesday afternoon following a hearing of Mr Sefcovic, a social-democrat who is the nominee to take on the job of co-ordinating the EU's overall green policies.

Some EU officials said scheduling the hearings of Mr Hoekstra and of Mr Sefcovic during the same week at the European Parliament in Strasbourg was a way for opposing political groups to make sure their rival's candidate only gets approved if their own candidate does. Each needs support from two-thirds of the committee to pass.

The hearings of the two recently appointed EU Commission climate officials reflect deep divisions within the European Parliament.

The European People's Party's attempt at blocking a flagship nature conservation law this summer caused anger among the greens and social democrats.

Mr Hoekstra, a centre-right Dutch politician, faced tough questioning on Monday night as left and centre-left politicians repeatedly raised doubts about his credibility.

If the European Parliament refuses to back Mr Hoekstra, the EU will lack a chief negotiator at the coming Cop28 UN climate negotiations in late November.

Meanwhile, some EU legislators have portrayed Mr Sefcovic as influenced by internal politics in his home country.

Mr Sefcovic, who tried but failed to become Slovakia's president in 2019, is viewed as an experienced technocrat in Brussels, where he occupied various posts as commissioner since 2009.

The recent criticism seemed to reflect the MEPs' intention to question his suitability to lead the European Commission's work on its green deal – an ambitious set of climate policies that aim to make the continent carbon neutral by 2050.

Mr Sefcovic is from the same political party as general election winner Mr Fico, who campaigned by promising to shift Slovakia, an EU and Nato member state, closer to Hungary in challenging the bloc's consensual support of Ukraine against Russia.

Mr Fico now has two weeks to try to form a coalition government.

Peter Liese, an MEP of the European People's Party, asked Mr Sefcovic about his neutrality amid Russian President Vladimir Putin's influence in Slovakia.

“I was very shocked listening to Mr Fico. He is mainly a friend of Putin as I see it,” said Mr Liese.

“How strong will you be if Mr Fico is in office again?”

Another German EPP politician, Christian Ehler, was even more aggressive in his questioning of Mr Sefcovic.

“In 2019, you took money from Robert Fico for your campaign,” he said.

"You stated: 'I don't view Russia as a threat but a strategic challenge,' added Mr Ehler, who said that his own father was "beaten half to death by the Russians."

“Do you stand for the sanctions, for the ban of gas, for European solidarity also in your home country – also if you risk that Mr Fico being in government means that you're not appointed next time as commissioner?” asked Mr Ehler.

Pointing his finger directly at Mr Ehler, a visibly exasperated Mr Sefcovic defended his track record in the European Commission, where he has overseen the EU's efforts at joint gas purchasing after Russia's full-scale invasion of Ukraine last year, while hinting at Germany's past support for the Nordstream gas pipelines that increased Europe's reliance on Russia.

“You know who was pushing me very hard to get it approved, and I don’t need to elaborate more because you know what I’m talking about,” he said, in a reference to Nordstream.

“When it comes to the elections in Slovakia, I can tell you that this was one of the most polarising, tough campaigns,” he said.

“I can ensure you that whatever the result of the formation of the government may be, I'll always defend the European general interest as I did since 2019.”

Mr Sefcovic added that he was a “friend” of Ukraine and pointed at a medal he received from Ukraine's President Volodymyr Zelenskyy in October 2020. “I was there when they needed me,” he told the hearing.

A fair transition

The political tensions cast a shadow over Mr Sefcovic's attempts to steer the question and answers session towards climate policies.

In his opening statements, he said that he wanted to focus on engaging with industry and the support of European citizens for the green deal to ensure a “fair and socially just transition.”

He added that he supported Mr Hoekstra's goal to strive reach the recommended target of 90 per cent net reduction in greenhouse emissions in the EU by 2040.

The European right and far-right has said that some climate policies, including the nature restoration law, endangers food security and the livelihoods of farmers in Europe – a claim rejected as “fake news” by the left.

Conservative legislators such as Alexandr Vondra from the Czech Republic expressed distaste for Mr Sefcovic's predecessor, Dutch politician Frans Timmermans, who quit the job in August to participate in a national election.

Mr Timmermans used to be both executive vice president for the European Green Deal and was also responsible for climate action – a job that will be divided between Mr Sefcovic and Mr Hoekstra, should the European Parliament approve their appointments.

While acknowledging political polarisation on climate, Mr Sefcovic pitched himself as a safe pair of hands, saying that he “believed in dialogue, in exchange of views and in concrete projects.”

“We have to work for the people,” he said.

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

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Updated: October 03, 2023, 1:36 PM