GTAP Resources: Resource Display
| GTAP Resource #7809 |
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"CBAM impacts on non-EU countries: the cases of least developed economies and neighbouring countries" Authors: Garaffa, Rafael, Matthias Weitzel and Camille Van Der Vorst Abstract The EU Carbon Border Adjustment Mechanism (CBAM) aims to reduce the risk of carbon leakage by levelling the playing field for emission-intensive, trade-exposed industries. Apart from practical implementation challenges, the degree to which the CBAM impacts industries outside the EU depends mainly on their trade exposure and their emission intensity. Since the European Commission proposed the introduction of the CBAM, in July 2021, the literature about its effects has grown exponentially but few studies in the literature have modelled the impact of CBAM on developing countries. Here we assess the impact of the CBAM on 50 countries and regions, with the EU modelled as a single region. We focus on Least Developed Countries (LDCs), a selection of other developing and emerging economies and selected EU neighbourhood partner countries. We use the JRC-GEM-E3 computable general equilibrium (CGE) model and the GTAP11 circular economy database to compare the introduction of the CBAM (including the associated phase-out of free allowances in the EU) to a baseline scenario without the CBAM, but with a continuation of other EU climate policies. Although most LDCs export only a very limited amount of CBAM goods to the EU, shifts on trade patterns are expected and the aggregate of LDCs shows a reduction on exports of 2.8% compared to the baseline by 2035. The CBAM is also expected to reduce greenhouse gases (GHG) emissions in non-EU countries with respect to exports to the EU, by reducing demand for high-emission intensity goods. We find that, compared the baseline, GHG emissions decrease the most in neighbourhood countries (- 11.4 Mt of CO2-eq) in 2035. Overall, the impact on LDCs, developing countries and neighbourhood countries is relatively minor in aggregate, but can be more substantial at sectoral level due to differences in emission intensities. |
| Resource Details () | GTAP Keywords | ||||||||||||||||
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- Climate change policy - Trade and the environment - Economic geography - Supply chains - Baseline development - Dynamic modeling - Partial and general equilibrium models - European Union - Global |
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Public Access  GTAP Resource 7809 (425.1 KB) Replicated: 0 time(s)Restricted Access No documents have been attached. Special Instructions Draft not for publication. Do not cite or quote. |
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Last Modified: 4/20/2026 1:44:43 PM
