How can we effectively implement a carbon border adjustment mechanism at the borders?

Abstract

This article intends to examine the border carbon adjustment mechanism as a potential complement to existing macro-environmental policies in light of the European Union’s reaffirmed climate goals. Rather than solely targeting greenhouse gas emissions produced by manufacturing, the border carbon adjustment mechanism aims to address all greenhouse gases associated with consumption, which could enhance their effectiveness with regard to international trade. The European Union will have to select among various types of border carbon adjustment mechanisms, each with its own environmental and economic objectives, if it decides to go down this path. Moreover, the decision must take into account the legal constraints of the multilateral trade framework within which the European Union operates - they are significant but not insurmountable.

Kevin Parra Ramirez

PhD candidate in Economics, Sciences-Po Paris &

I am a Ph.D candidate at Sciences-Po Paris under the supervision of Prof. Philippe Martin (Sciences-Po) and Vincent Vicard (Deputy Director of CEPII) and Research Economist at Banque de France