As part of its "Green deal", the outlines of which were revealed by Ursula von der Leyen on Wednesday 11 December, the European Commission intends to propose a carbon border adjustment mechanism. By sanctioning imports from highly polluting countries, it would make it possible to combine the EU's climate objectives with the international competitiveness of European companies.
The purpose of this carbon inclusion mechanism would be to reintegrate environmental externalities into the production costs of products imported into the Union. In this way, the Commission would prevent European companies from suffering from European measures to achieve carbon neutrality - and thus combat climate change (see other articles). It would also prevent any carbon "leakage" outside the EU (the departure of European companies to territories with more lax climate rules).
A first (small) step
This shows that the stakes are high. Expectations are high among Member States, who see it as the counterpart to any energy tax or extension of the Emissions Trading Scheme (ETS).
However, it will take two years for the Commission to table its proposal. This will be limited, at least initially, to only a few key, energy-intensive sectors that are probably already included in the EU Emissions Trading Scheme (ETS) - such as cement production.
WTO Compliance
On the other hand, if everyone agrees that these measures must be compatible with the non-discrimination principles of the World Trade Organization (WTO), it is more easily said than done.
"Trade economists have been analysing this solution for more than 20 years, but no country has adopted it so far, because in practice, the implementation of this system is extremely complex", notes Simone Tagliapietra, an expert at the Bruegel think-tank.
The aim will be to calculate the carbon footprint of the industrial processes of imported products. However, even within a country, a process may differ from another. Another challenge is to trace the path of these products through extremely complex global value chains.
As a result, avoid reprisals from the EU's trading partners - China has already expressed its mistrust of this mechanism, according to a recent report - while at the same time avoiding penalising exports from economically less developed countries. This promises to be quite a conundrum! (Original version in French by Hermine Donceel)