The US wants the EU to delay imposing trade penalties on carbon-intensive imports, but is considering imposing its own

(Inside Climate News, 22 Mar 2021) “Border carbon adjustments” could push more countries to address climate change, or spark trade wars. They’re a top diplomacy issue for the US as it reengages in the Paris accord.

Even when nations have agreed to act on climate—as they have in the Paris accord—a kind of stalemate continues.

The reason: A prevailing view that the laggards will enjoy an economic advantage over the leaders that have burdened their domestic industry with the cost of cutting carbon pollution. That thinking led President Donald Trump to exit the Paris agreement, and it is certain to fuel political opposition to President Joe Biden as he brings the United States back into the fold.

Economists have long suggested that there’s a way to break that global impasse—and that’s to treat carbon like any other international trade dispute. Impose tariffs or quotas on imports from countries that have given their manufacturers an unfair advantage of uncontrolled carbon emissions. The promise of so-called “border carbon adjustments,” an idea which has won support across the industry, labor and environmental communities, is that it will erase the advantage of delay. The most hopeful advocates argue that the marriage of climate and trade will catalyze action.

Now, for the first time, nations are planning to make the idea of border carbon adjustments a reality. The European Union Parliament voted overwhelmingly on March 10 in favor of a resolution to create a border adjustment mechanism to protect its manufacturers against cheaper imports from countries with weaker climate policy.

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Inside Climate News, 22 Mar 2021: The US wants the EU to delay imposing trade penalties on carbon-intensive imports, but is considering imposing its own

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