With its carbon border tax, the European Union is accused of protectionism

It is a new source of tension between developed and emerging countries in the fight against global warming. The carbon border tax project, presented by Brussels as a “contribution to the reduction of emissions at the global level”, has been described as a measure. “Protectionist” and “Discriminatory” by several emerging countries.

Presented on July 14, this tax, which Brussels prefers to call a “border carbon adjustment mechanism”, will set a carbon price for imports of certain products. This is to avoid the relocation of polluting industries to countries where standards are less strict and where CO emissions are2 are not taxed as they are on the Old Continent.

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This device, which would gradually come into force from 2026, should eventually replace the free emission allowances currently allocated to certain polluting companies such as airlines to prevent them from being penalized vis-à-vis their competitors. foreigners. “The purpose of this mechanism is also to encourage industries outside the Union, as well as our international partners, to take measures in the same direction”, Brussels clarified.

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According to Unctad, the United Nations agency that represents developing countries, Russia, China, Turkey, Ukraine, India and Brazil will be the most affected by this tax, which should apply in initially to imports of fertilizers, steel, aluminum, electricity and cement. This one “Could redirect trade flows to countries where production is less polluting, but will have little effect on global warming”, believes the Unctad.

“Deep concern”

According to his calculations, exports from developing countries would fall by 1.4% if the price per tonne of carbon was set at 44 dollars (38 euros), and by 2.4% if it reached 88 dollars, while that CO emissions2 in the world would decrease by 0.1%. Moscow, which estimates the shortfall on its exports to Europe at 7.6 billion euros, is preparing an import tax in retaliation.

For China, this measure violates the rules of the World Trade Organization and could even lead to a distortion of competition.

In April, environment ministers from China, Brazil, India and South Africa stepped up to express “Their deep concern about the project to set up unilateral trade barriers, such as the carbon adjustment mechanism, which are discriminatory and contrary to the principles of equity and common but differentiated responsibilities”. This last principle recognizes the additional efforts that industrialized countries must make, because they have a historical responsibility in the degradation of the environment and have more important means to protect the climate. “The carbon adjustment mechanisms at the borders are, in several respects, modern instruments of an imperialism that punishes developing nations, whose transition to a green economy is slower”, castigates Charmi Mehta, researcher at the Finance Research Group, based in India.

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With its carbon border tax, the European Union is accused of protectionism

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