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World’s poorest should not pay for climate action while EU industry pollutes for free

(EurActiv, 14 Mar 2022) As EU finance ministers meet on Tuesday (15 March) to discuss the proposal for a carbon border levy, they should look to protect the most vulnerable countries from being hit and work to phase out free allowances quicker, write Anne Gläser and Chiara Putaturo.

Anne Gläser is a senior policy advisor for carbon pricing at Germanwatch, and Chiara Putaturo is an EU inequality and tax policy advisor at Oxfam.

Tomorrow much is at stake when European finance ministers meet to discuss the new EU proposal for a carbon border tariff (carbon border adjustment mechanism – CBAM).

This proposal aims to propel EU countries to reach for higher climate ambition and incentivise trading partner countries to accelerate climate action.

Therefore, the European Commission’s proposal from July is a step forward. But two severe flaws threaten the success of this instrument.

Firstly, it fails to address the impact on the poorest countries. Secondly, it prolongs the unsustainable and unjust system of free allocation of allowances for EU companies.

The Commission’s proposal means companies exporting into the EU must buy a carbon permit showing the amount of carbon emissions in their goods. It will apply only to certain sectors and only if the exporting countries are not pricing carbon emissions domestically.

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EurActiv, 14 Mar 2022: World’s poorest should not pay for climate action while EU industry pollutes for free