The Carbon Border Adjustment Mechanism (CBAM) will provide economic and employment opportunities, as well as ensuring the competitiveness of Europe’s energy-intensive industry, according to a study by the European Trade Union Institute ETUI, published on Friday 29 July.
The implementation of CBAM from 2026 is expected to create up to 230,000 jobs by 2030 and 460,000 by 2040, according to ETUI researcher Béla Galgóczi. The study is based on several scenarios for the coming years: - a reference scenario, known as “naive decarbonisation”; - a scenario based on electrification, hydrogen deployment and energy efficiency; - a scenario focusing on alternative materials and efficiency; - a scenario focusing on the deployment of carbon capture and storage.
For each of them, the implementation of CBAM increases GDP by about 0.45 percentage points. The study predicts that imports and exports will fall in energy-intensive sectors, but that consumption-oriented sectors will increase their sales and production.
The positive effect on employment is expected to materialise mainly for non-energy intensive sectors, as the CBAM revenues are converted into tax reductions that should stimulate production.
However, the study is based on a projection of CBAM that differs from the mechanism that will eventually be put in place, as it considers that more products will be affected by CBAM than is currently foreseen by the European institutions. Furthermore, the study excludes from its calculations electricity generation, which will be subject to CBAM. The authors believe that these methodological biases, which point in different directions, would roughly balance each other out.
See the study: https://aeur.eu/f/2rg (Original version in French by Léa Marchal)