The European Union, the United Kingdom** recently announced that it will impose a Carbon Border Adjustment Mechanism (CBAM) on emissions-intensive goods imported from countries deemed to have weaker climate rules in 2027. The proposed UK CBAM will apply to carbon-intensive products in the iron, steel, aluminium, fertiliser, hydrogen, ceramic, glass and cement industries.
The UK's move seems to confirm that the CBAM's international "dominoes" have been opened, and once they are opened, they will be difficult to stop. The EU CBAM and the UK CBAM have been officially announced, will other economies be far away?
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Will Canada be next?Will the US CBAM be far away?
Back in 2021, Canada's Deputy Prime Minister and Minister of Finance, Christia Freeland, and Minister of Environment and Climate Change, Jonathan Wilkinson, jointly launched consultations on CBAM and began to solicit public opinions to ensure that there is a consensus on CBAM in Canada. Canada's ruling Liberal Party is already pushing for a carbon tax on products imported from China that use coal power, but no specific rules or implementation date have yet been set.
It is reported that in the context of the European Union, the United Kingdom and Canada considering or implementing the carbon border adjustment mechanism, there are also voices in the United States that hope that the carbon border adjustment mechanism can be used as an opportunity to strengthen its climate leadership and cooperation with allies, and develop its own carbon border adjustment mechanism or carbon pricing scheme in line with the EU carbon border adjustment mechanism and other international standards, so as to protect and strengthen the climate competitiveness of the US manufacturing industry.
If you can't beat it, join it?
The idea of taxing carbon-intensive imports is gaining traction across the world's major economies, which could hurt export-intensive industries in other countries. With many countries and regions around the world setting up CBAM or other carbon barriers in the name of preventing "carbon leakage", more and more countries are preparing to set up their own "carbon barriers" with the mentality of "joining if you can't beat it".
Clearly, there is a risk that CBAM will trigger a green ** war. It remains to be seen whether carbon-intensive exporters will retaliate with tariffs, but there are signs that the environmental sector is slowly becoming a new international battleground.
"Carbon barrier" points in various countries.
In fact, not only CBAM, in the new round of global competition, developed countries and regions have taken advantage of their own technological advantages and good industrial foundations to successively introduce various carbon emission regulations, standards and other innovative institutional arrangements to curb the import of competing products from other countries in the name of "carbon".
In recent years, countries including the United States, Japan, Canada and other countries have introduced some "carbon barrier" measures. For example, the United States has previously raised additional taxes on imported chemicals, petroleum and other products, although there is no carbon in the name, but the essence is formulated for carbon emissions. The carbon barriers of developed countries such as Europe and the United States also include the new battery bill and the carbon footprint requirements for photovoltaic imports. It is estimated that at least 2 trillion yuan of Chinese exports will directly face the challenge of carbon tariff barriers or carbon cost in the future.
Mapping Tao Ye, a researcher at the Beijing News Zero Carbon Research Institute.
Tao Ye, a researcher at the Beijing News Zero Carbon Research Institute
Edited by Song Yuting.
Proofread by Yanjun Zhang.