The Guardian: EU becomes first leading economy to legislate for ‘green tariff’ on imports
Article published: 13 December, 2022
IB Economics syllabus: The Global Economy (trade protectionism, tariffs)
The EU takes it seriously
The European Union (EU) has become the first leading economy to pass legislation for a “green tariff” on imports. The new system will penalize countries that don’t decarbonize industries such as iron and steel, cement, fertilisers, aluminium, electricity, hydrogen and some chemicals. The carbon border adjustment mechanism (CBAM) requires companies to report the emissions associated with the production of the goods they want to sell. The move is part of the EU Green Deal, which aims to meet the EU’s stringent climate targets, and may be the first step towards a global effort to cut greenhouse gas emissions. The initial CBAM requirements will apply only to a few sectors but there are plans to expand it to more, including processed products like cars.
IB Economics Internal Assessment (IA) Commentary
This is a great article to use for your Global Economics IA, focusing on trade barriers. Essentially, the EU will place tariffs on imports that are produced by using high carbon dioxide emissions. So for the diagram, use an international trade diagram with the tariff shifting the world supply curve upwards. Make sure that you fit the article into two pages and that you explain your diagram in detail. Also, as for the key concept, you can use interdependence.
Source of image: Jonathan Nackstrand/AFP/Getty Images
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