Tribune. Climate change will be high on the agenda of the US-EU summit on June 15, raising hopes for the potential role of transatlantic partners in promoting global decarbonisation.
There are reasons to be optimistic. The two blocs now share a common climate ambition and, as they account for 40% of global gross domestic product and 30% of merchandise imports, other countries cannot afford to ignore what is happening there. The key question is: how can the European Union (EU) and the United States strengthen their national decarbonisation efforts, while together encouraging other countries to move in the same direction?
In our view, the answer lies in the joint introduction of carbon adjustment measures at borders. Carbon adjustment measures at the border consist of taxing imported goods based on their carbon footprint. Charging this tax, the amount of which would be equivalent to the price of carbon on the internal market, is essential for any country that intends to seriously step up its decarbonisation actions.
A level playing field
Indeed, putting carbon pricing or strict environmental regulations in place to reduce emissions runs the risk of “carbon leakage”, that is to say a shift in the production of carbon-intensive goods to more carbon-intensive goods. countries where climate policy measures are weaker, before re-importing these same products from these countries.
In other words, carbon border adjustment is not protectionism, but aims to guarantee a level playing field, since some countries are more serious than others in implementing their reduction commitments. shows.
As part of the European Green Deal, the EU is already planning the introduction of border carbon adjustment measures covering the electricity sector and energy-intensive industrial sectors by 2023. This could be a good thing means of setting up the system, which will then have to be extended to all imported goods in order to be effective.
The question of borders
Until 2020, European politicians feared that the United States would see such a move as the start of a trade war. But during the presidential campaign, Joe Biden pledged to introduce taxes on carbon-intensive goods imported from countries that fail to meet their climate and environmental obligations.
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