U.S., China and India lash out at EU climate policy

The European Union is less than three months away from initiating the world’s first large -scale border tax on carbon dense goods.

The upcoming step with the potential to completely transform global trade comes as a part of the blocks. efforts To reduce greenhouse gas emissions caused by heavy industries and to promote worldwide clean production processes.

EUs from 1 January next year Carbon boundary adjustment mechanism (CBAM) will bring a cost to goods such as steel, fertilizers, cement, aluminum and hydrogen imported from outside the 27 -national block.

In terms of policy, importers who bring these goods to the EU will be asked to purchase CBAM certificates to meet their related emissions. The cost of these certificates is expected to be the same as the EU Emission Trade System (ETS) market price.

Not everyone is excited about the EU’s upcoming carbon border tax. USA, China, India and Brazil are among the countries that express their concerns. threatening Taking retaliation measures and others warning Politics can prevent global climate efforts instead of helping.

The EU’s executive branch, the European Commission, did not respond to the request for comments when the CNBC was contacted.

Nicolas Endress, the founder and CEO of Climease, a CBAM software solutions company, said that the EU’s integrated carbon tax and tariff plan will reshape global trade as much as most businesses have understood. Steel, cement, fertilizers and aluminum -related sectors are first adjusted on the fire line.

Stating that countries that do not have an emission trade system (ETS) will be exposed to border tax, the US, Brazil and India’s appreciation of their concerns about politics, “no surprise,” he said.

The EU said the CBAM was designed to put a “fair price” on the carbon spread during the production of emissions intensive goods.

The tax is also designed to prevent what is known as “carbon leakage”, which is when companies carry production abroad to countries with less strict climatic policies.

The US warned that European climatic rules may threaten EUs. Trade agreement with the White House.

Speaking Financial times Last month, US Energy Secretary Chris Wright, in the absence of important changes, said the EU’s CBAM – as well as other green regulatory policies, as well as “big legal risks” for US companies selling fossil fuel to Europe.

Other countries exposed to the EU CBAM also criticized plans. India reported He said that high -income countries, historically responsible for the climate crisis, should do more to reduce greenhouse gas emissions, he said he would retaliate against carbon border taxes.

Meanwhile, China, Brazil and Russia UN Climate Negotiations And World Trade Organization.

EU’s von der leyen, 2019 Manifesto In order to become the President of the European Commission, he said that “to bring a carbon border tax to prevent carbon leakage and help EU companies” compete in a flat playground “.

The policy was later introduced as part of Bloc’s effort to reduce emissions at least 55% at the end of ten years.

Alex Mengden, a European Policy Analyst in the Tax Foundation, said EU officials tried to underestimate the potential of any retaliation step from major economies when the final stage of the CBAM started.

“Mengden, CNBC’ye video conversation, said,” We can only show that we can get too many climatic leadership, because we have real costs on us and if we are not in a global coalition, these costs return to ourselves instead of our trade partners, this is actually the target. “

“Now, of course, he can still be successful, Men Mengden said. “For the policy makers designing the CBAM policy, the case of success will be other countries that adopt their ETS systems.”