EU Cross-border carbon tax: conflicting signals for metallurgy

Abstract

The subject of the analysis is the EU initiative to introduce the so-called Border Carbon Correction Mechanism (CBAM), developed within the framework of the "European Green Course" adopted in 2019 from the point of view of the interests of the Russian ferrous metallurgy. The author analyzes the CBAM rules and procedures developed by the European Commission, including the commodity nomenclature of carbon-taxable ferrous metallurgy products. An assessment of the positions and interests of the European ferrous metallurgy industry in relation to CBAM and the actions of the industry lobby in the course of promoting this initiative is given. The conclusion is made about the achieved narrowing of the intended scope of the CBAM in terms of the covered industries and types of gases and about the extension of the timing of the mechanism's entry into force. The positions of such major global players as China, India, Brazil, African and South-East Asian countries are analyzed in relation to CBAM and prospects for the transformation of this initiative in the current situation are outlined. In connection with the EU ban on the import of Russian ferrous metallurgy products, recommendations are given to Russian metallurgical companies on possible steps to track the details of the promotion of the CBAM initiative. The article was prepared based on the results of research carried out at the expense of budgetary funds under the state assignment to the Financial University under the Government of the Russian Federation.