Saving face and facing climate change: Are border adjustments a viable option to stop carbon leakage?

Palacková, Eva

doi:10.1177/1781685819881372

Cited by 12 publications

(3 citation statements)

References 10 publications

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“…Knowledge of this challenge appears to be rising in academia and policy-making (Wiedmann et al 2020;O'Neill et al 2018). Green economy and sustainable consumption advocates in many high-income countries are thus shifting their focus towards global en- vironmental impacts of national economic activity (Palacková 2019). However, ambitious and thus costly policy action to mitigate international environmental impact shifting and achieve globally sustainable levels of local consumption eventually requires that consumers and citizens care equally about environmental impacts of their consumption both at home and abroad (Barnett et al 2010).…”

Section: Theoretical Arguments and Expected Empirical Implicationsmentioning

confidence: 99%

Could Closing the Knowledge Gap Help in Reducing Global Environmental Impacts of Local Consumption?

et al. 2022

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Section: Theoretical Arguments and Expected Empirical Implicationsmentioning

confidence: 99%

Could Closing the Knowledge Gap Help in Reducing Global Environmental Impacts of Local Consumption?

et al. 2022

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“…When the data on carbon emissions becomes merged with international trade law, optimistic reduction effects could be realized [33,34]. Furthermore, regulations on export subsidies and Emission Trading System (ETS) free allowance allocations must be included to fully realize the effect of the carbon border tax [33,35]. At the WTO Committee on Trade and Environment (CTE) meeting in March 2021, the lack of transparency in the CBAM and how it could potentially distort trade were pointed out [3].…”

Section: Limitations Of the Cbammentioning

confidence: 99%

Pitfalls of the EU’s Carbon Border Adjustment Mechanism

et al. 2021

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The European Union (EU), which has led international discussions on global warming, officially announced its plan for the Carbon Border Adjustment Mechanism (CBAM) in July 2021. Many existing studies have indicated the CBAM will curtail greenhouse gases, and will subsequently be positive in terms of reducing global warming. However, serious legal issues and trade disputes are expected in terms of the compatibility of the CBAM with the trade rules of the General Agreement on Tariffs and Trade (GATT). Contrary to the EU’s explanation, the international community has a strong view of CBAM as a new trade barrier under the guise of preventing global warming. Above all, this is because it is an arbitrary measure by the EU and not the one that has been internationally agreed upon. Therefore, this paper tries to identify the pitfalls and estimate the global cost of CBAM, arguing that the mechanism is not in line with international trade rules, and that many countries will not sit back and suffer from it. The world economy will inevitably face a vicious cycle of trade retaliation. The CBAM will drive up trade costs and cause another trade distortion. While the goal of preventing climate change is good, the CBAM scheme is too costly for the world economy.

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“…As one of the EU's core policy tools to address climate change, the EU CBAM has become a hot topic in academia recently. Carbon tariffs on imports from EU trading partners might bring tangible results in avoiding carbon leakage, as well as a significant impact on trade [8,18,19]. By simulating changes in the overall exports of EU member states and non-EU member states to the EU, Zhong and Pei [11] found that after the implementation of the EU CBAM, output in the EU would increase by 0.38%, while output in the rest of the world would decrease by 0.1%.…”

Section: Introductionmentioning

confidence: 99%

The Impact of the EU Carbon Border Adjustment Mechanism on China’s Exports to the EU

Zhu,

Zhao,

Zheng

2024

Energies

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The EU Carbon Border Adjustment Mechanism (CBAM), which is regarded as the EU’s key policy tool to address carbon leakage, might have a non-negligible impact on China’s exports, as China is an important trading partner for the EU’s carbon-intensive products. This paper uses the GTAP-E model to simulate the impact of the EU CBAM on China’s exports to the EU from four aspects, export price, trade structure, trade value and terms of trade, by setting up multiple scenarios. The results show that the EU CBAM reduces the export prices of China’s taxed sectors to the EU, and that the export prices of other sectors show the same change characteristics. The export volume of China’s taxed sectors decreases differently with the export transfer effect and export inhibition effect. In terms of trade value, the EU carbon tariffs not only reduce China’s export value but also lead to a reduction in EU exports. The implementation of the EU CBAM improves the terms of trade of the EU and worsens the terms of trade of China. An expansion of the scope of taxation and a change in the calculation method of carbon emissions would aggravate the change in the terms of trade. The results suggest that feasible measures should be taken to strengthen international cooperation, promote the construction of a unified national carbon market and export diversification, and establish a firm carbon emission accounting system in order to mitigate the negative impact of the EU CBAM.

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Saving face and facing climate change: Are border adjustments a viable option to stop carbon leakage?

Cited by 12 publications

References 10 publications

Could Closing the Knowledge Gap Help in Reducing Global Environmental Impacts of Local Consumption?

Could Closing the Knowledge Gap Help in Reducing Global Environmental Impacts of Local Consumption?

Pitfalls of the EU’s Carbon Border Adjustment Mechanism

The Impact of the EU Carbon Border Adjustment Mechanism on China’s Exports to the EU

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