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Currently, the EU is responsible for 9% of global emissions. The European Green Deal puts forward an ambitious plan towards the climate neutrality and reduction of the European carbon footprint. Achieving a climate neutral and circular economy requires the full mobilisation of industry. The European Commission observed that it takes 25 years – a generation – to transform an industrial sector and all its value chains. And so, the urgent task is to have everyone on board and provide optimal conditions for transformation while safeguarding jobs through innovation and new technologies.

The successful implementation of the EU Green Deal should lower EU emissions to 4%. However, according to the European Commission, this transformation of EU economy by 2030 will cost at least 260 bn EUR per year. The scale of this task compared to the limited impact on global climate brings forth the need, on the one hand, to encourage and incentivize EU trade partners to increase their pro-climate efforts and, on the other, to ensure EU industries’ competitiveness as they implement the difficult industrial and energy transformation that many of their global competitors have yet to take. Without these flanking measures, despite EU’s own ambitious and necessary strive for carbon neutrality, the EU’s total carbon footprint may grow due to CO2 embedded in imported goods. Climate objectives may have been thwarted.

In the European Green Deal, we witness the first real attempt to enact an instrument addressing these challenges. The idea of a carbon border adjustment mechanism (CBAM) – soon to be proposed by the Commission – is debated among stakeholders in Brussels, as climate activists focus on climate objectives and industry representatives emphasize the need to maintain competitiveness. The discussion resounds among our trading partners concerned about the possibility of hidden protectionism. There are many unanswered questions that must be answered, from very general questions about the nature of the instrument to detailed mechanics of the system. Until now, the discussion has been carried out predominantly in Brussels, but wider public in EU Member States must be engaged to explain CBAM across Europe.

In the aftermath of the recent vote in the European Parliament on CBAM and awaiting the publication of European Commission’s legislative proposal it is increasingly becoming clear that the key issue that attracts interest of stakeholders is how to reconcile EU climate ambition to become carbon neutral by 2050, competitiveness of the EU industry and relations with the EU trading partners, all in a WTO-compatible way.



TGA Summit organiser:
Clean Air Foundation
Positive Ideas Foundation
Business and Science Poland (BSP)

Media partnership:
EURACTIV

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