Thai exporters get ready for Europe's control on carbon-emission imports
The Department of Trade Negotiations (DTN) has warned Thai exporters to brace for the impact of the European Union’s Carbon Border Adjustment Mechanism (CBAM), which should be finalised by December 15.
Under CBAM, a carbon tariff will be placed on carbon-intensive goods like cement and energy imported by EU countries. It is likely to take effect in 2026 with reporting starting next year.
A discussion between the European Commission, the European Parliament and the EU Council for the final phase of the measure is still pending, DTN director-general Auramon Supthaweethum said on Friday.
She said there were still some disagreements between the three parties, especially in terms of adding hydrogen, chemicals and plastics to CBAM products, the extension of the transition period and the revocation of free allowance for products costing less than 150 euros (about 5,500 baht).
However, she expects the differences to be ironed out and details finalised by December 15.
The transition to carbon-free imports is scheduled to begin on January 1, 2023, when importers will have to start submitting reports on carbon emissions “embedded” in their imports. These “embedded” emissions refer to the carbon emitted directly or indirectly during the production process.
“CBAM currently covers five products, namely cement, iron and steel, aluminium, fertilisers, and electricity,” Auramon said. “The list of products covered by CBAM will be expanded in coming years.”
However, she said, though details of CBAM are yet to be finalised, Thai exporters should follow its progress closely so they can adjust before the new regulations affect their exports.
She added that the ministries of Commerce and Natural Resources and Environment, along with the Thailand Greenhouse Gas Management Organisation, are working to help Thai businesses meet international standards.
Auramon said this is one of the key steps Thailand needs to take on its road to becoming a low-carbon society and economy.
