AUTHORS: Tim Gore – Eline Blot – Tancrede Voituriez (IDDRI) – Laura Kelly (IIED) – Aaron Cosbey (IISD) – Jodie Keane (ODI)

This briefing explores the potential implications of an EU Carbon Border Adjustment Mechanism (CBAM) for climate vulnerable countries.

The European Commission is expected to present a formal proposal for the CBAM on 14 July. The mechanism carries substantial implications for countries that are most vulnerable to climate change, as their exports are likely to be directly or indirectly impacted by the measure, and because of the likely knock-on implications for wider multilateral efforts to fight climate change.

This briefing explores these issues and proposes key ways in which they might be addressed. It looks at questions around:

• strengthening the dialogue between EU and climate vulnerable country actors around CBAM;
• ensuring CBAM has environmental integrity by avoiding double compensation for EU industries;
• potential exemptions;
• use of CBAM revenues and wider aid for trade measures to support low carbon transitions in climate vulnerable countries.