A CO2-border adjustment mechanism as a building block of a climate club

Bericht

The EU steps up its efforts to curb its territorial CO2-emissions. It is planning to introduce a carbon border adjustment mechanism (CBAM) to level the playing field and to raise own resources. However, unilateral European climate policy action, whether shored up with a CBAM or not, can only play a limited role in reducing global CO2-emissions. A U-CBAM cannot stop indirect leakage, it has ambiguous effects on other countries' mitigation efforts, and it poses the risk of conflicts with trade partners.The EU, together with the US and other like-minded countries, should push hard to establish a climate club with a common minimum price of CO2and a common CBAM applied to third countries. Such a framework would incentivize other countries to join while limiting leakage and reducing the risk of trade policy disputes.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Kiel Policy Brief ; No. 151

Classification and Topics

• Classification: Wirtschaft
• Subject: Climate Policy ; Carbon Leakage ; Carbon Border Adjustment ; Climate Club ; Klimapolitik ; Carbon Leakage ; CO2-Grenzausgleich ; Klimaclub

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Bierbrauer, Felix ; Felbermayr, Gabriel ; Ockenfels, Axel ; Schmidt, Klaus M. ; Südekum, Jens
• Event: Veröffentlichung
• (who): Kiel Institute for the World Economy (IfW)
• (where): Kiel
• (when): 2021

Further information

• Handle: http://hdl.handle.net/10419/232523
• Last update: 10.03.2025, 11:42 AM CET