Europe wanted its carbon border tax to go global - is it working?

illuminem summarises for you the essential news of the day. Read the full piece on CTV News or enjoy below:

🗞️ Driving the news: As the EU’s Carbon Border Adjustment Mechanism (CBAM) becomes fully operational on January 1, it is beginning to reshape climate policy far beyond Europe – pushing trading partners to price carbon at home or pay at the border

🔭 The context: CBAM links trade access to carbon pricing
• Importers of emissions-intensive goods like steel, aluminium, and fertiliser must declare embedded CO₂ and pay a levy if it exceeds EU standards
• The policy mirrors the EU’s internal carbon price, aiming to prevent carbon leakage and level the playing field
• Countries can avoid the levy by adopting equivalent domestic carbon pricing rules

🌍 Why it matters for the planet: CBAM is exporting climate ambition through markets
• Several major trading partners have expanded or launched emissions trading schemes – including China and Turkey
• Others, such as Japan, have explicitly cited CBAM as a reason to accelerate carbon pricing
• The policy has sharpened global momentum toward carbon markets, even amid accusations of protectionism

⏭️ What’s next: Influence, friction, and diplomacy
• Some countries – including the UK and Canada – are considering CBAM-style mechanisms
• Critics like Russia and parts of the developing world argue CBAM violates trade rules and have raised concerns at the WTO and COP talks
• Experts say long-term success will depend on how many countries adopt effective carbon pricing – and how well different systems interact

💬 One quote: “Pricing carbon is something that we need to pursue with as many as possible, as quickly as possible,” said EU climate commissioner Wopke Hoekstra

See on illuminem’s Data Hub™ the sustainability performance — carbon credit purchases, total emissions, and climate targets of thousands of companies

Click for more news covering the latest on the carbon market