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Is the EU’s Carbon Border Adjustment Mechanism a Threat for Developing Countries?

“As part of the lengthy fight against climate change, the European Union (EU) has introduced a Border Carbon Adjustment Mechanism (CBAM), among its “Fit for 55” package, intended to deliver the EU’s intermediate target of reducing greenhouse gas (GHG) emissions by 55% from 1990 levels by 2030. This proposal is deemed “bold, complicated, even controversial.” If implemented, it will undoubtedly disrupt trade relations between the EU and its main partners and transform energy dynamics in the Atlantic basin. The CBAM aims to introduce a carbon price to imported products inside the EU equivalent to the carbon price applied to products manufactured by EU producers under the EU Emissions Trading Scheme (ETS). It “would require importers to purchase carbon emissions certificates for imports that the EU determines are not produced under emissions standards similar to those of the EU.”

 

  Is the EU’s Carbon Border Adjustment Mechanism a Threat for Developing Countries?

          By Rim Berahab

International Intelligence Unit – FGV IIU
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