Ariadne report: Reactive CBAM diplomacy helps showcase EU’s climate policy leadership

In a new Ariadne report, Hertie School researchers Dr. Marian Feist, Ann-Kathrin Kühner (now at Freie Universität), and Professor of Climate Policy Christian Flachsland argue that the European Union’s outreach to third countries during the introduction of CBAM was rigid and uncoordinated. According to the researchers, there was no concrete diplomatic strategy to address CBAM in international talks. Therefore, the EU’s lack of willingness to accommodate its trading partners' concerns, contributed to CBAM being perceived as an unmalleable instrument proving EU’s high ambitions in climate matters. 

To safeguard these ambitions and its climate targets – such as becoming climate neutral by 2050 – the EU proposed CBAM which, starting in 2026, will oblige companies to pay a compensation price for the import of certain industrial goods that were produced with a lower carbon price than in the EU. The paper argues that there was a need for corresponding diplomatic efforts, given the confrontational nature of the policy. Nevertheless, the EU showed itself primarily focused on negotiating details of the CBAM among its member states, neglecting any kind of coordination regarding talks with third countries. 

Considering strong initial international reactions, CBAM diplomacy focussed on explaining the technical modalities of the mechanism rather than addressing trade policy issues, which so far has proved to be an effective means in resisting criticism, the researchers say.  

Read the full report here.

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