The Morality of Carbon Border Taxes
By Doug McConnell
The European Parliament has adopted a tool called the Carbon Border Adjustment Mechanism (CBAM) which will apply the EU’s carbon pricing to imported goods. This means that imports from countries with lesser or non-existent carbon pricing will effectively face a tariff. Various governments including Australia and China have objected strongly to the CBAM claiming that it unfairly forces EU rules on other countries, discriminates against them, and represents a return to the bad old days of trade protectionism.
So are CBAMs a noble mechanism to push the world towards carbon neutrality or the latest tool for powerful nations to assert control over weaker nations? I argue that the CBAM does have the potential to be discriminatory and unjust but not against rich countries like Australia that have had ample opportunity to develop (and maintain) a carbon pricing system.
