German Chancellor Angela Merkel, center, arrives for a round table meeting at an EU summit in Brussels, Friday, July 17, 2020. (AP)
European Union leaders were meeting in Brussels on Friday to battle over a proposed multi-billion euro stimulus package, which investors, activists and lawmakers said would need strict rules to guarantee a "green" recovery from the coronavirus pandemic.
Under discussion at Friday's summit is the EU's next long-term budget, worth around 1 trillion euros, plus a proposed 750 billion euro recovery fund of grants and loans aimed at rebuilding virus-hit economies.
The European Commission, the bloc's executive arm, has said the economic destruction wreaked by the virus would not shake its plans to make the EU "climate neutral" by 2050, and promised that recovery spending would drive green growth.
But some researchers have said weak safeguards mean the funds may prop up polluting sectors.
"Once you look at the programmes that are planned, you see that basically, this is goodbye to the Paris Agreement," Luisa Neubauer, a German youth climate activist from campaign group Fridays for Future, told Reuters.
The 2015 Paris pact committed nations to long-term goals to limit average global temperature increases.
Neubauer joined a group of activists outside the EU headquarters in Brussels on Friday, where they laid out large bags emblazoned with euro signs, demanding that recovery cash is spent on protecting the planet for future generations.
With large economies such as China and the United States using stimulus funds to boost fossil fuels, Neubauer said it was up to Europe to prove clean investments can power the recovery.
"There's no continent left that could step in... If not Europe, who else?"
The Commission has proposed that 25% of the EU budget will go on climate spending, while spending from its recovery fund should follow a principle to "do no harm" to climate goals.
European Council President Charles Michel, who will host the Brussels talks, wants 30% of the entire package earmarked for climate, and says countries must commit to be "climate neutral" by 2050 to get funds - demands bound to face opposition from eastern countries sceptical of tougher targets.
The Institutional Investor Group on Climate Change (IIGCC), whose members have more than 30 trillion euros in assets under management, said planned EU green finance rules should be used to block recovery money from supporting fossil fuels.
This demand was also backed by a cross-party group of lawmakers from the European Parliament - who must approve the final EU package.
"Any project not compatible with the European climate neutrality objectives will not be financed," said French lawmaker Pascal Canfin.