COP28: Unilateral carbon taxes coercive trade measure, say BASIC nations

Grouping of Brazil, South Africa, India and China says new 'green trade barriers' against WTO rules

Unilateral and coercive climate change-related measures such as new carbon border taxes constitute a disguised restriction on international trade and should be avoided, the BASIC grouping of nations has said ahead of the upcoming COP28 summit in Dubai.

Comprising Brazil, South Africa, India, and China, the bloc has often argued together at COP and has maintained a common minimum position.

On Tuesday, the grouping said trade restrictions had an adverse impact on equitable and just transitions, in the context of sustainable development and efforts to eradicate poverty. It especially opposed any measures to restrict trade and investment through the setting up of new 'green trade barriers' such as unilateral carbon border taxes.

 

A carbon border adjustment tax is a duty on imports based on the amount of carbon emissions resulting from the production of the product in question. As a price on carbon, it discourages emissions.

Such taxes, imposed under the pretext of addressing climate change, are incompatible with multilateral rules under the World Trade Organization (WTO) and the Paris Agreement’s principle of equity and 'Common but Differentiated Responsibilities and Respective Capabilities' (CBDR-RC), the grouping said.

"Concerning trends towards unilateralism, trade protectionism, and fragmentation of international cooperation jeopardize trust and, consequently, ambitious climate action. In order to reverse such trends, the international community must reiterate its firm commitment to contributing to an international environment that is conducive to sustainable development," the bloc said.

The countries have requested their latest position be added to the provisional agenda of COP.

In a significant move, the grouping said nations should also reiterate opposition to the politicization of climate change issues and all forms of unilateralism and protectionism.

This should be done 'recognising that unilateral measures violate the objectives and principles of the Convention and its Paris Agreement, and seriously undermine multilateral cooperation and the ability of the concerned countries to combat climate change,' it said.

The grouping has also pushed for inclusive and equitable global decision-making processes that are effectively representative of humanity’s 'collective intelligence and development aspirations', with a view to shared prosperity.