The Australian energy and emissions reduction minister, Angus Taylor has alerted that the European Union is attempting to implement a carbon tax on imports, which would be unfavourable to Australia’s export industry.
The Energy Minister prompted against a ‘new wave’ of European protectionism that would seriously dent Australia’s export industry on which a huge portion of its economy depends.
According to the Observatory of Economic Complexity (OEC), Australia attracts around $284 billion from its export products, while its service exports inflows around $75.6bn
Taylor said: “At a time when liberal democracies are working together to rebuild confidence in the benefits of free and open trade, a new wave of protectionism now threatens to sweep across the world.”
Lately, the European Union (EU) has revealed that it is seeking to introduce a Carbon Border Adjustment Mechanism (CBAM) which would see EU importers buy carbon certificates for the ‘carbon price’ that would have been paid if the goods had been produced within the bloc.
However, once a non-EU producer can deliver proof of their payment for the carbon used in the production of the goods, the cost can then be reduced for the EU importer.
This forms part of the EU’s proposal to meet the commitments of the 2015 Paris Agreement, with carbon the key culprit in global warming and emissions.
Taylor although being a minister of emissions reduction has criticized the mechanism, saying it “discriminates against countries like Australia”.
The minister further added: “CBAM, which has been designed in compliance with World Trade Organisation (WTO) rules, will punish developing countries which often rely on energy from fossil fuels.”
“It will punish developing countries relying on energy-intensive industries to generate the economic growth and jobs that will lift their citizens out of poverty,” he said.
“It will punish sectors namely aluminium and others that will be covered in the first phase of this new European protectionism.”
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