emirates7 - The European Union will begin implementing the Carbon Border Adjustment Mechanism, CBAM, tomorrow, Thursday, 1st January 2026.
The mechanism is expected to have a limited impact on international trade, particularly as it currently covers less than 5 percent of the European Union’s imports of key products such as steel, aluminium, cement and fertilisers. However, its long-term implications could be broader as its scope is set to expand starting in 2028.
According to estimates by the Organisation for Economic Co-operation and Development, the mechanism currently targets only 303 products, representing around 3 percent of the European Union’s total imports. The International Monetary Fund has estimated that the share could reach 4.5 percent based on 2021 trade data.
The mechanism is expected to have a limited impact on international trade, particularly as it currently covers less than 5 percent of the European Union’s imports of key products such as steel, aluminium, cement and fertilisers. However, its long-term implications could be broader as its scope is set to expand starting in 2028.
According to estimates by the Organisation for Economic Co-operation and Development, the mechanism currently targets only 303 products, representing around 3 percent of the European Union’s total imports. The International Monetary Fund has estimated that the share could reach 4.5 percent based on 2021 trade data.