European Roundtable on Climate Change and Sustainable Transition and Graduate School for Public Policy announce cooperation on Border Carbon Adjustments.

BRUSSELS, TOKYO (May 26, 2020) – The European Roundtable on Climate Change and Sustainable Transition (ERCST) and the Graduate School for Public Policy at Tokyo University are pleased to announce their collaboration in examining the role that Border Carbon Adjustments (BCAs) may play in addressing asymmetry in climate ambition under the Paris Agreement, with special focus on the plans that the European Union has to examine this option. In this context, ERCST & GrasPP will hold a virtual Japan-EU “town hall meeting” on July 9, 2020. This activity together with other similar planned “town hall” meetings will feed into a policy paper on the international views on BCA that ERCST will publish in collaboration with its partners.

The European Green Deal has strengthened the level of climate ambition, increasing the asymmetry of climate efforts by aiming to achieve climate neutrality in the European Union by 2050. This raises the question of how to deal with competitive pressure and carbon leakage, pushing BCAs to the front as a possible solution.

Border carbon adjustments (BCAs) aim to alleviate negative effects caused by uneven climate policies by including imports and/or exempting exports. BCAs seek to level the playing field in competitive markets, incentivize trade partners to strengthen their own climate efforts and prevent leakage of carbon emissions to jurisdictions with weaker policies. These objectives can be achieved by a tariff or other fiscal measure applied to imported goods, the extension of regulatory compliance obligations (e.g. ETS) to imports or a tax exemption or regulatory relief for exports.

Andrei Marcu, Executive Director of ERCST emphasized that “the BCA, its design and impacts on trade and international cooperation need to be well understood, since it will become increasingly urgent to address the effects of asymmetrical climate change policies and BCAs are presented as a serious option. As think tanks, we will cooperate with colleagues in other countries in this effort”

Jun Arima, Professor at GrasPP said, “the BCA, which is under discussion by the EU will have profound impact on international trade and climate regime. It calls for thorough and measured examination from various aspects taking into account the views of EU and non-EU stakeholders. As a graduate school training policy professionals and studying public policy issues, we are glad to set up this platform.

ERCST provides for a space for policy-makers, regulators and stakeholders to discuss climate change policy and the transition to a low GHG-economy in a sustainable way, with a focus on European climate policy but keeping in mind the global dimension of climate change policy. The experience and research input of its staff and of the stakeholders joining its activities allow the ERCST to make an intellectual analysis contributing to the European and international debates on climate change policy. Continuing its work on carbon leakage protection, the ERCST is analyzing issues and options of designing BCAs in practice and discussing coherent ‘policy packages’ that could be implemented at the EU level in 2020.

Since its establishment in 2004, GrasPP has been striving to train policy professionals for work in diverse fields of public policy by delivering an academic education that balances law, political science and economics together with practical lessons from teaching staff with past experience of working at international institutions or government agencies.

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Ms. Indira Vlaminck