亞開行-歐盟碳邊界調(diào)整機制：對亞洲的經(jīng)濟影響和啟示（英）

NO.276

NOVEMBER

2023

ADBBRIEFS

KEYPOINTS

?Quantitativeanalyses

suggestthatthevalueoftheCarbonBorderAdjustmentMechanism(CBAM)in

termsofmitigatingclimate

changeismarginal.However,itsimpactsontradepatterns,competitiveness,andincomedistributionarefarfrom

negligible,especiallyfordevelopingeconomies.

?TheoveralleconomicimpactoftheCBAMseemstobe

limitedforAsianeconomies,butsomeeconomiesface

significantcostincreasesatthesectorlevel,suchasIndiaintheironandsteelsector,

Georgiainfertilizer,andKazakhstaninaluminum.

?TheCBAMpresentsan

opportunityforAsian

economiestofocuson

developingtheircarbon

markets,whiletackling

shortfallsininvestments

requiredtodevelop

renewableenergysources.

?CBAM-affectedeconomiescouldconsiderrespondingbyupgradingthevalueadded

oftheirexportstoavoidthecarbontariff.

?Diversificationofexportmarkets,increasingtheproductivecapacityof

non-CBAMsectors,and

buildingstatisticalcapacitiesmayhelpmitigatetherisk

exposuretoCBAMintheshortterm.

ISBN978-92-9270-487-2(print)

ISBN978-92-9270-488-9(electronic)ISSN2071-7202(print)

ISSN2218-2675(electronic)

PublicationStockNo.BRF230561-2

DOI:

/10.22617/BRF230561-2

EuropeanUnionCarbonBorder

AdjustmentMechanism:EconomicImpactandImplicationsforAsia

Cyn-YoungPark

Director,RegionalCooperation

andIntegrationandTradeDivision

ClimateChangeandSustainable

DevelopmentDepartment(CCSD)AsianDevelopmentBank(ADB)

YuyaYamamoto

TradeSpecialist,RegionalCooperationandIntegrationandTradeDivision

CCSD

ADB

MariaAnneLorraineDoong

Consultant,RegionalCooperation

andIntegrationandTradeDivisionCCSD

ADB

OVERVIEW

TheEuropeanUnion(EU)aimstobecomethefirstclimate-neutraleconomicbloc

by2050,throughtheEUGreenDeal.In2021,theEUstrengthenedthiscommitmentbyadoptingthe“Fitfor55”package,whichupholdsaninterimtargetofreducingnet

greenhousegasemissionsbyatleast55%by2030froma1990baseline.Thisambitionposesanincreasedriskofcarbonleakage—wherecarbon-intensiveindustriesshift

productiontoeconomieswithlessstringentenvironmentalregulations.

Toaddresspotentialcarbonleakage,theEUGreenDealincludestheCarbonBorder

AdjustmentMechanism(CBAM),whichimposesacarbontariffoncarbon-intensive

productssuchasironandsteel,cement,fertilizers,aluminum,electricity,andhydrogen.Theseitemswereselectedbecausetheyarehighlysusceptibletocarbonleakageand

createsignificantcarbonemissionsthatneverthelesscanbetracked(Sim?es2023).

TheEuropeanCommissionconsidersCBAMa“l(fā)andmarktool”forputtingafairpriceoncarbonemissionsgeneratedduringtheproductionofidentifiedgoods(European

Commissionn.d.).TheCBAMimposesacarbonpriceonimportsofemissions-intensiveandtrade-exposed(EITE)goodstoensuretheyhaveasimilarcarbonpricetodomesticproducts.Italsoaimstopreventcarbonleakage.CBAMpreventscarbonleakageby“subjectingthe

Note:Inthispublication,“$”referstoUnitedStatesdollars.

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ADBBRIEFSNO.276

importofcertaingroupsofproductsfromthirdeconomies(non-EUandnon-EFTA)toacarbonlevylinkedtothecarbonpricepayable

undertheEUEmissionsTradingSystem(ETS),supposingifthesamegoodswereproducedwithintheEU,”accordingtoDeloitte(2023).

Canada,theUnitedStates,andtheUnitedKingdomarealsoexploringmechanismsforbordercarbonadjustment.

TheCBAMregulationenteredintoforcethedayafterits

publicationintheEU’sOfficialJournalon16May2023.TheEU

planstoimplementtheCBAMintwostages.First,thetransitionalphasestartedon1October2023.Duringthisstage,importersofCBAMgoodsarerequiredtosubmitquarterlyreportsindicating:

(i)quantitiesofCBAMgoodsimportedduringthequarter,

specifiedpereconomyoforiginperproductionsite;(ii)embeddeddirectand,ifapplicable,indirectgreenhousegasemissions;and

(iii)thecarbonpricedueintheeconomyoforigin,ifapplicable.

InthesecondstageoftheCBAM,from1January2026,thefull

scopeofregulationwilltakeeffect,withpriceadjustmentson

importedproducts.Importerswillneedto:(i)obtainauthorizationtoimportCBAMgoods,(ii)declarethequantityofCBAMgoods

importedintotheEUintheprecedingyearalongwiththeir

embeddedgreenhousegasemissions,and(iii)surrenderCBAMcertificatestocoverthedeclaredemissions(Deloitte2023).

TheCBAMwillbephasedinalongsidethephasingoutoffreeallowancesundertherevisedETS.Themechanismwillinitiallyincludesixselectedindustries:cement,aluminum,fertilizers,electricity,ironandsteel,andhydrogen,inadditiontosome

precursorsandafewdownstreamproducts.Undercertainconditions,indirectemissionswillbeincluded.

ASIA’SEXPOSURETOTHECBAM

TheintroductionoftheCBAMhassignificanteconomicimplicationsfortradeandinvestment,especiallyindevelopingeconomies.A

UnitedNationsConferenceonTradeandDevelopment(UNCTAD2021)studyfoundthattheCBAMcouldaltertradepatternsin

favorofeconomieswithrelativelycarbon-efficientproduction

andsuppressexportsfromdevelopingeconomieswithcarbon-

intensiveindustries.EconomieswithEITEproductsasalargeshareofexportswillbeparticularlyexposed.Also,risksinadaptingtotheCBAMwouldincreaseineconomiesreliantontheEUasanexportmarketandineconomieslackingthecapacitytotrackandreport

production-relatedcarbonemissions.Economiesthatstruggleto

adjusttoalow-carbonparadigmmayalsobeathigherriskofimpact.

Riskscanbetrackedbasedontheexposureandvulnerabilityof

economiestotheCBAM.TheWorldBankhasdevelopedthe

CBAMExposureIndextohelpeconomiesmakepolicydecisions.TheindexgaugesthepotentialforCBAMtoimpactexports

ofcarbon-intensivegoodsforthesixselectedindustries.Itis

calculatedbymultiplyingtheexportshareofeacheconomybythe

embodiedcarbonpaymentperdollarofexporttotheEU

(theexporter’semissionintensitymultipliedbya$100perton

carbonprice).EconomieswithahighscoreontheCBAMexposureindexarelikelytobemoreaffectedthaneconomieswithalowscore.

TheWorldBankhasalsocreatedarelativeexposureindex.Thisiscalculatedbymultiplyingthesameexportsharebythedifferencebetweentheexporter’semissionintensityandtheEUaverage

emissionintensityfortheCBAMproduct,scaledbytheassumedCBAMpriceof$100pertonofcarbon(WorldBank2023).

Apositiverelativeexposureindexindicatesthataneconomyhashighercarbon-emissionintensitythantheEUaverage,andso

willlikelyhavehighercostsunderCBAM.Ontheotherhand,a

negativerelativeexposureindexshowsthataneconomyhaslower

emissionintensitythantheEUaverage.Forexample,ifGeorgiahas

anaggregaterelativeCBAMexposureindexscoreof0.0464,then

theadditionalcostwillbe$4.64pertonofcarbondioxide(CO2)

emitted.TheindexalsoincludestheaggregateCBAMexposureindexwhichresultsfrommultiplyingtheexportsofallcoveredsectorsof

theproductstotheEUbythesumofthetotalembodiedcarbon

payments(theassumedpricemultipliedbytheexporter’semissionintensityofallcoveredsectorsoftheproduct),dividedbythesumoftheeconomy’stotalvalueofexportsofCBAMproductstotheworld.

AsianExposurebyEconomy

Figure1ashowsthat,amongtheaccountedeconomies,ADB’sregionalmembersarenotamongthetopCBAMproductexporterstothe

EUasashareoftheirtotalCBAM-affectedproductsexportedto

theworld.ExportersofCBAMproductstotheEUaredominatedbyeconomiesinAfrica,theMiddleEast,andEurope.Asianeconomiesarepredominantlyatthemiddletothetailendofthegraph,ledbyGeorgiawith34.80%,Cambodiawith19.18%,andIndiawith18.92%.

Figure1bpresentstheexportsofCBAM-affectedproductsto

theEUasapercentageofthegrossdomesticproduct(GDP)of

57economies.EconomiesinAfricashowahighshareofCBAM

productsintheirGDP,withMozambique(6.9%)asthetopexporter.

TheexportsofCBAMproductsarenotveryeconomicallysignificantevenforthelargestregionalexportersuchasGeorgia(0.3%).

GeorgiahasthehighestaggregaterelativeCBAMexposureindex,

withascoreof0.0464.Indiacomesnextwith0.0303,followedby

Kazakhstanwith0.0051,VietNamat0.0043,andHongKong,Chinaat0.0033,asinFigure1c.ThissuggestsadditionalcostsfromCBAMimplementationwillbe$4.64pertonofCO2emissionsforGeorgiaand$3.03forIndia.FormostAsianeconomies,theadditionalcostsarelessthan$1pertonofCO2emissions.

AsianExposurebySector

WhileAsia’soverallexposuretotheCBAMseemslimited,

theimpactcouldbesignificantforcertainsectorsandforsomeeconomies.Theregion’ssectorexposuresareshowninFigures2to5.1DatashowstheexportsofCBAMproducts.2

1TheWorldBankdatabasedoesnothavedataonallADBregionalmembers.Presenteddataareonlythoseavailable.

2Ironandsteel;fertilizer;cement;andaluminum;nodataonhydrogen;nodataonADB’sregionalmembersforelectricity.

EuropeanUnionCarbonBorderAdjustmentMechanism:EconomicImpactandImplicationsforAsia

%

Cameroon

Zimbabwe

Mozambique

UnitedKingdom

Albania

Belarus

Venezuela

Türkiye

Tunisia

Egypt,ArabRep.

Ukraine

Ghana

Georgia

RussianFederation

Israel

Jordan

Chile

Cambodia

India

Tajikistan

SouthAfrica

Azerbaijan

Morocco

UnitedArabEmirates

Bahrain

Kazakhstan

Taipei,China

TrinidadandTobago

Brazil

Colombia

RepublicofKorea

UnitedStates

PRC

Indonesia

VietNam

Malaysia

Iran,IslamicRep.

HongKong,China

NewZealand

Thailand

Kuwait

SriLanka

Oman

Canada

SaudiArabia

Argentina

Japan

Mexico

Mauritius

Philippines

Australia

Pakistan

Peru

Senegal

Singapore

CostaRica

Qatar

%

Mozambique

Ukraine

Belarus

Bahrain

TrinidadandTobago

Türkiye

Albania

RussianFederation

Tunisia

Zimbabwe

Egypt,ArabRep.

UnitedArabEmirates

Morocco

Georgia

Taipei,China

Cameroon

SouthAfrica

UnitedKingdom

RepublicofKorea

Jordan

Kazakhstan

Venezuela

Ghana

VietNam

Oman

Malaysia

India

Azerbaijan

Tajikistan

Chile

Brazil

PRC

Indonesia

Iran,IslamicRep.

Israel

Thailand

Canada

Cambodia

NewZealand

SaudiArabia

Qatar

Mauritius

Japan

Colombia

Senegal

Mexico

Argentina

UnitedStates

HongKong,China

Australia

Singapore

CostaRica

Pakistan

Kuwait

SriLanka

Peru

Philippines

Figure1:CBAMExposureofSelectedEconomies

a.CBAMProductsExportstotheEU(%oftotalCBAMproductsexportstoworld)

100.0000

90.0000

80.0000

70.0000

60.0000

50.0000

40.0000

30.0000

20.0000

10.0000

0.0000

b.CBAMProductsExporttotheEU(%ofGDP)

7.0000

6.0000

1.0000

0.0000

c.AggregateRelativeCBAMExposureIndex

Zimbabwe

Ukraine

Georgia

India

Belarus

TrinidadandTobago

Egypt,ArabRep.

RussianFederation

Venezuela

SouthAfrica

Kazakhstan

Türkiye

Iran,IslamicRep.

VietNam

Tunisia

HongKong,China

Brazil

PRC

Indonesia

Oman

Pakistan

Azerbaijan

Argentina

Peru

Malaysia

SaudiArabia

Kuwait

Thailand

Mexico

UnitedArabEmirates

UnitedStates

Bahrain

RepublicofKorea

Philippines

Mozambique

NewZealand

Canada

Singapore

Tajikistan

CostaRica

Australia

Qatar

Cameroon

Ghana

Japan

SriLanka

Senegal

Taipei,China

Mauritius

Cambodia

UnitedKingdom

Morocco

Chile

Israel

Jordan

Colombia

Albania

0.0900

0.0700

0.0500

0.0300

0.0100

-0.0100

-0.0300

CBAM=CarbonBorderAdjustmentMechanism,EU=EuropeanUnion,GDP=grossdomesticproduct,PRC=People’sRepublicofChina.

Note:TheWorldBank’sdatabasefortheCBAManalysisincludes57economies,20ofwhichareregionalmembersofADB.OrangebarsrepresentADB’sregionalmembers.

Source:WorldBank2023.

3

4

ADBBRIEFSNO.276

%

Zimbabwe

Switzerland

Norway

UnitedKingdom

Tunisia

Albania

Venezuela

Belarus

Türkiye

Egypt,ArabRep.

Ukraine

Cambodia

Federation

India

Senegal

Israel

Russian

Mozambique

Kuwait

SouthAfrica

Taipei,China

Brazil

Morocco

UnitedStates

RepublicofKorea

Georgia

PRC

Indonesia

Iran,IslamicRep.

VietNam

NewZealand

Malaysia

Australia

Thailand

HongKong,China

Kazakhstan

UnitedArabEmirates

Oman

Argentina

Azerbaijan

TrinidadandTobago

SriLanka

Japan

Mexico

CostaRica

SaudiArabia

Peru

Canada

Bahrain

Chile

Philippines

Singapore

Pakistan

Qatar

Colombia

l

r

l

.

.

India

Albania

HongKong,China

Azerbaijan

PRC

Brazi

Peru

RepublicofKorea

Qata

Chile

Japan

SriLanka

Israe

Taipei,China

Cambodia

Figure2:AsianCBAMExposure—IronandSteel

a.ExportsofironandsteeltoEU(%oftotalironandsteelexportstotheworld)

100.00

90.00

80.00

70.00

60.00

50.00

40.00

30.00

20.00

10.00

0.00

b.RelativeCBAMExposureIndex

0.1000

0.0800

0.0600

0.0400

0.0200

Zimbabwe

Ukraine

Egypt,ArabRep

Venezuela

RussianFederation

SouthAfrica

Mozambique

Georgia

Kazakhstan

Belarus

Tunisia

VietNam

Iran,IslamicRep

Türkiye

Oman

TrinidadandTobago

Indonesia

Argentina

Kuwait

UnitedArabEmirates

Bahrain

NewZealand

Thailand

Pakistan

UnitedStates

Malaysia

Mexico

Canada

SaudiArabia

Philippines

Singapore

Colombia

CostaRica

Australia

Senegal

Morocco

UnitedKingdom

(0.0200)

CBAM=CarbonBorderAdjustmentMechanism,EU=EuropeanUnion,PRC=People’sRepublicofChina.

Note:OrangebarsrepresentADB’sregionalmembers.

Source:WorldBank2023.

CambodialeadsinexportsofironandsteeltotheEU,whichmarks34.25%ofitstotalironandsteelexports.ThisisfollowedbyIndiawith23.55%;Taipei,Chinawith13.22%;theRepublicofKoreawith10.66%;Georgiawith9.43%;andthePeople’sRepublicofChina

(PRC)with8.76%.

ADB’sregionalmembersscoregenerallylowinrelativeCBAMexposureindexes.Amongthem,Indiahasthehighestscore,at0.0436,followedbyGeorgiaat0.0097,Kazakhstanat0.0078,

HongKong,Chinaat0.0055,andVietNamat0.0054.IndiafacesthehighestadditionalcostfromCBAMimplementationiniron

andsteel,butit’sstill$4.36pertonofCO2emissions.ForotherAsianeconomies,theadditionalcostislessthan$1pertonofCO2emissions.

GeorgiacomesouttopinfertilizerexportstotheEU,whichconstituteasignificant59.47%ofitstotalfertilizerexports.Azerbaijanisclosebehind(58.65%);thenJapanwith2.08%;

5

EuropeanUnionCarbonBorderAdjustmentMechanism:EconomicImpactandImplicationsforAsia

Figure3:AsianCBAMExposure—Fertilizer

a.ExportsoffertilizertoEU(%oftotalfertilizerexportstotheworld)

%

80.000070.000060.000050.000040.000030.000020.000010.0000

0.0000

Belarus

UnitedKingdom

Georgia

Azerbaijan

Israel

Tunisia

Switzerland

Ukraine

Türkiye

Egypt,ArabRep.

b.

Chile

Jordan

RussianFederation

Norway

TrinidadandTobago

Morocco

Mexico

UnitedStates

Japan

Iran,IslamicRep.

Colombia

Kazakhstan

CBAMExposureIndex

Mauritius

India

PRC

Taipei,China

VietNam

Canada

SouthAfrica

Australia

Oman

SaudiArabia

UnitedArabEmirates

Relative

Ukraine

Georgia

Belarus

TrinidadandTobago

RussianFederation

Egypt,ArabRep.

Azerbaijan

Iran,IslamicRep.

Türkiye

Kazakhstan

India

PRC

Oman

Mexico

SouthAfrica

VietNam

Taipei,China

SaudiArabia

Canada

UnitedArabEmirates

Australia

Japan

Mauritius

UnitedStates

Colombia

Morocco

Tunisia

Jordan

Chile

Israel

UnitedKingdom

0.1000

0.0800

0.0600

0.0400

0.0200

-

(0.0200)

(0.0400)

CBAM=CarbonBorderAdjustmentMechanism,EU=EuropeanUnion,PRC=People’sRepublicofChina.

Note:OrangebarsrepresentADB’sregionalmembers.

Source:WorldBank2023.

Kazakhstanat1.31%;Indiawith1.12%;PRCwith1.07%;Taipei,Chinawith0.80%;andVietNamat0.60%.

GeorgiaalsoclaimsthehighestrelativeCBAMexposureindex,withascoreof0.0814,followedbyAzerbaijanat0.0102,India

at0.0010,Kazakhstanat0.0014,thePRCwith0.0007,andVietNamat0.0002.Intermsoffertilizer,GeorgiafacesthehighestadditionalcostfromCBAMimplementationat$8.14pertonofCOemissions.

2

Malaysiatakestheleadintermsofitsrelativeshareofcement

exportstotheEU,makingup6.69%ofitstotalglobalcement

exports.ThisisfollowedbyJapanwith1.68%,Pakistanwith1.67%,thePRCwith1.08%,VietNamwith0.73%,andIndiawith0.61%.

MalaysiaalsostandsoutintherelativeCBAMexposureindexwiththescoreof0.0256,followedbythePRCat0.0034,Pakistanat

0.0033,VietNamat0.0026,andIndiaat0.0013.Malaysiafaces

6

ADBBRIEFSNO.276

%

Ukraine

UnitedKingdom

Colombia

Norway

Morocco

Switzerland

Belarus

Albania

Tunisia

Türkiye

Malaysia

Egypt,ArabRep.

SaudiArabia

Japan

Pakistan

UnitedStates

PRC

VietNam

India

Belarus

Ukraine

Malaysia

SaudiArabia

Tunisia

PRC

Pakistan

VietNam

India

UnitedStates

Japan

Türkiye

Egypt,ArabRep.

UnitedKingdom

Albania

Morocco

Colombia

100.000090.000080.000070.000060.000050.000040.000030.000020.000010.0000

0.0000

Figure4:AsianCBAMExposure—Cement

a.ExportsofcementtoEU(%oftotalcementexports)

b.RelativeCBAMExposureIndex

0.3500 0.3000 0.2500 0.2000 0.1500

0.1000

0.0500

-

(0.0500)

(0.1000)

(0.1500)

CBAM=CarbonBorderAdjustmentMechanism,EU=EuropeanUnion,PRC=People’sRepublicofChina.

Note:OrangebarsrepresentADB’sregionalmembers.

Source:WorldBank2023.

thehighestadditionalcostfromCBAMimplementationat$2.56pertonofCO2emissionsincement.

Inthealuminumsector,KazakhstanhasthehighestshareofexportstotheEU,at42.15%,followedbyAzerbaijanwith29.30%.Behind

themarethePRCwith13.20%,thePhilippineswith9.28%,Indiawith9.08%,theRepublicofKoreawith7.22%,andMalaysiawith6.55%.

KazakhstankeepsthetoppositionintherelativeCBAMindex,

withascoreof0.0404,followedbyAzerbaijanat0.0073,PRCat

0.0028,Indiaat0.0024,andTajikistanat0.0023.AlthoughthePhilippinesrankedfourthamongtheAsianexporterstotheEU,itsrelativeCBAMexposurescorecomesoutlowest,at–0.0005,

trailedbyHongKong,ChinaandtheRepublicofKoreawith

–0.0002.KazakhstanfacesthehighestadditionalcostfromCBAMimplementationinaluminumat$4.04pertonofCO2emissions.

Overall,thetradeimpactoftheCBAMforAsianeconomies

appearsmanageablegiventheregion’srelativelylowexposure.However,certainsubregionsoreconomieswithstrongertrade

7

EuropeanUnionCarbonBorderAdjustmentMechanism:EconomicImpactandImplicationsforAsia

%

Mozambique

Ghana

Cameroon

Norway

Morocco

Switzerland

Egypt,ArabRep.

UnitedKingdom

Tunisia

Türkiye

Ukraine

Kazakhstan

Venezuela

RussianFederation

Jordan

Azerbaijan

UnitedArabEmirates

SouthAfrica

Bahrain

Israel

PRC

Belarus

UnitedStates

Philippines

India

ROK

SaudiArabia

Malaysia

Oman

HongKong,China

Canada

Thailand

Tajikistan

NewZealand

VietNam

Japan

Mexico

Brazil

Taipei,China

Indonesia

Argentina

Qatar

Singapore

Colombia

Australia

.

l

l

r

Egypt,ArabRep

SaudiArabia

PRC

Argentina

Mexico

Taipei,China

Figure5:AsianCBAMExposure—Aluminum

a.ExportsofaluminumtoEU(%oftotalaluminumexportstotheworld)

100.0000

90.0000

80.0000

70.0000

60.0000

50.0000

40.0000

30.0000

20.0000

10.0000

0.0000

b.RelativeCBAMExposureIndex

0.0700

0.0600

0.0500

0.0400

0.0300

0.0200

0.0100

-

Mozambique

Kazakhstan

Venezuela

Cameroon

Ukraine

Azerbaijan

SouthAfrica

Tunisia

Bahrain

Oman

RussianFederation

UnitedArabEmirates

India

Tajikistan

Brazi

Indonesia

Türkiye

Israe

NewZealand

Canada

UnitedStates

Belarus

Australia

Malaysia

Singapore

Japan

VietNam

Qata

Colombia

Thailand

RepublicofKorea

HongKong,China

Philippines

Jordan

Morocco

UnitedKingdom

Ghana

(0.0100)

CBAM=CarbonBorderAdjustmentMechanism,EU=EuropeanUnion,PRC=People’sRepublicofChina,ROK=RepublicofKorea.

Note:OrangebarsrepresentADB’sregionalmembers.

Source:WorldBank2023.

tieswithEuropewillbemoreaffected.SomeAsianeconomiesaremoreexposedinthattheytrademorecarbon-intensivegoodswiththeEU(suchasCentralAsia,duemostlytosignificantexportsofaluminumandfertilizer).Someeconomieshaveahighshareof

carbon-intensivesectorsintheireconomies,suchasforironandsteeloraluminumexportstotheEU.

Asia’ssectorexposuretotheCBAMvariesamongeconomiesand

couldbesignificantforsome.Forexample,Georgia’sfertilizerand

ironandsteelindustriesaresubstantiallyexposedandcontributedtotheoverallhighestexposure.Indiaalsobelongstothetopeconomies

withthehighestCBAMexposureindexscoresamongidentified

sectors,withironandsteelasitsmostexposedsector.Morethan

halfofGeorgian(59.47%)andAzerbaijan(58.65%)fertilizerexportswenttotheEU.ThismakesGeorgiasubjecttoarelativelyhighscoreof0.08114andAzerbaijanascoreof0.0102onCBAMexposure

indexforfertilizers.Foraluminum,42.15%ofKazakhstan’sexportsofthemetalwenttotheEU,makingitthemostexposedCBAM

aluminumexporter.Ontheotherhand,negativeCBAMexposurescoreswererecordedforCambodiaandSriLankaforironandsteel,andforthePhilippinesandThailandforaluminum,meaningtheir

emissionintensityislowerthantheEUaverage.

8

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Inaddition,Asia’sindustrialstructuretendstobeskewedtoward

higherCO2emissions,whichcouldmaketheregionmorelikelyintobesubjectedtotheCBAMinthefuture.TherearealsoissuesofthecapacitytotraceandtradeCO2emissions.Someeconomies

(suchasinthePacificandSouthAsia)maystruggletoadaptto

CBAMimplementationduetotheabsenceofcarbonemission-reducingmechanismsandlowstatisticalcapacitytomeasureandreportemissions.

ECONOMICIMPACTS

RepercussionsforExportsofADBRegionalMembersEUimportersofCBAM-affectedproductshavetoregisterwith

theirnationalauthorities(throughamechanismakintothe

ETS)anddiscloseemissionsfromCBAMproducts,inlinewith

exporters’certifications.Thedatamustbesubmittedby31May

ofthefollowingyearafterthecertification.Importersfacea

penaltyrateofapplyingtheaveragecarbonintensityofthe10%

oftheEU’sleastefficientproducersifexportersareunableto

supplycarbonintensityfigures.EUimporterswillalsoberequiredtobuycarbonimportpermitsstartingin2026(asystemthat

againissimilartotheETS).TheCBAMactsasataxbasedon

thecarboncontentofimportedgoodsandthepricedifference

betweencarbonintheEUandtheexportingeconomy,wherea

carbonpriceisoftennonexistent.ItaimstocreatefairconditionsforEUexportersandproducersandtoprevent“carbonleakage.”Giventhegapinprevailingenvironmentalregulationbetween

theEUanddevelopingeconomies,thereisaconcernthattheEUtransferspollutant-intensiveproductiontoeconomieswithlaxerenvironmentalregulations,thuscreatingcarbonleakage.Bytaxingthecarbon-intensivegoodsattheborder,theEUinducesnon-EUproducerstoadoptmorestringentenvironmentalregulations,

improvingtheEUproducers’marketcompetitivenessandgainingpublicbackingforcarbonpricing.Amongitsconsequences,theCBAMmightalsopromptEUtradingpartnerstoimposeatax

oncarbonemissions—wheretherevenuewouldgotonationalgovernments,nottheEU.

Nevertheless,thecarbontariffmayincreasethecostofexportedgoods.Figure6illustratestheestimatesforthecarbonborder

adjustmentlevyinpercentageofexportstotheEUinthebasicmetalindustry.

Forexample,SouthAfricawillbesubjecttoacarbonborder

adjustmentlevyonitsexportswithahighercarboncontentthan

theEUproduction.Asithasahighcarbonintensityof7,801.33tonsper$1millionworthofbasemetalproduction,thelevycanbe

estimatedbymultiplyingthecarbonintensitywiththecarbonpricedifferencebetweentheEUandSouthAfrica.UsingtheEUcarbonpriceof$96.30,SouthAfricafacesthehighestrateoflevyat68.16%ofitsbasicmetalexports,followedbyIndiaat38.80%,theRussianFederationat32.90%,andVietNamat22.05%oftheirrespective

basemetalexports.3Thesehighratesreflecttheirrelativelyhighcarbonintensitiesandlowdomesticcarbonprices.

Figure6:TheEstimatedCarbonBorder

AdjustmentLevyin%ofExportstotheEU

intheBasicMetalsIndustry

80

70

60

50

40

30

20

10

0

68.2

38.8

32.9

20.9

22.0

20.7

17.8

15.113.012.0

15.414.9

12.612.111.511.110.9

10.18.78.7

SouthAfrica

India

RussianFederation

VietNam

Taipei,China

PRC

Kazakhstan

Brazil

Thailand

RestoftheWorld

RepublicofKorea

Türkiye

Ukraine

Indonesia

Tunisia

Colombia

Malaysia

Argentina

Australia

Japan

ADB=AsianDevelopmentBank,EU=EuropeanUnion,

OECD=OrganisationforEconomicCo-operationandDevelopment,PRC=People’sRepublicofChina.

Notes:

1.RestoftheWorldindicateseconomiesthatdonothavedataontheircarbonintensityanddomesticcarbonprice.Tothem,thepenaltyrateoftheleast-efficientEU10%isappliedascarbonintensity.

2.OrangebarsrepresentADB’sregionalmembers.

Sources:OECDn.d.;WorldBank2023;andADBcalculations.

3Theratioiscalculatedas

×(-)

(1),

whereEEidenotestheembeddedemissionsintheexportstotheEUinthebasicmetalindustryfromeconomyi,