The EU carbon tax will destroy Ukrainian exports

With the entry into force of the CBAM carbon tax in the European Union from 2026, Ukraine may face serious economic losses. According to the GMK Center, between 2026 and 2030, total export losses may exceed $4.6 billion, and after 2030, the country may stop exporting cement, fertilizers, iron, square billets, and rolled products.

Impact on exports

After the blockade of the sea ports due to the war, the main trade partner of Ukraine became the EU. However, the introduction of CBAM will create additional barriers for Ukrainian exporters. It is expected that 15-17% of Ukrainian exports to the EU will fall under the influence of this environmental tax. In 2023, Ukrainian exports of goods subject to CBAM amounted to $3.6 billion, of which 93% accounted for ferrous metallurgy products.

GMK Center analysts warn that losses due to CBAM will increase. In 2026, the first year of full implementation of the tax, export losses could reach $202 million, and by 2030 this figure could reach $1.4 billion.

GDP losses

Losses of the Ukrainian economy may be even greater due to cross-industry connections. For example, in 2026, GDP losses could reach $790 million, and in 2030 - up to $4.9 billion. This indicates that the negative impact of CBAM will not be limited to the export sector, but will also affect other sectors of the economy.

The importance of exporting to the EU

Exports to the EU are vital for Ukrainian companies: in the first six months of 2024, Ukrainian companies exported 56.2% of their goods to the EU. Therefore, the introduction of CBAM will worsen the economic situation in Ukraine. This, in turn, contradicts the strategic interests of the EU, which supports Ukraine, since maintaining trade relations will allow Ukraine to integrate into the European economy and support the financial capabilities of the state budget.

The "Ukrcement" association has already stated that paying the CBAM environmental duty on general terms will lead to the loss of competitiveness of Ukrainian manufacturers. Therefore, the government should initiate negotiations to join CBAM on declaratory terms, which would allow duty-free reporting, citing war as a force majeure event under European law.

As Politico notes, Europe is helping Ukraine financially, but at the same time it is introducing the CBAM carbon tax, which could lead to a loss of €1.4 billion every year. These losses can be avoided by conducting negotiations with the EU, as the law on CBAM provides for the possibility of obtaining benefits in case of force majeure. Given the current situation in Ukraine, there is every reason to ask the EU for a delay in this matter.

spot_imgspot_imgspot_imgspot_img

popular

Share this post:

More like this
HERE

How gasoline prices in Ukraine may change in the coming days

The weekend brought a slight decrease in gasoline prices on Ukrainian...

A deputy of the Mykolaiv City Council simulated hitting a missile to steal soybeans

The National Police reported the suspicion to the deputy of the Mykolaiv City Council,...

The Russians intensified their assaults on the Vremevsky ledge and are preparing for an offensive near Gulyaipol and Orichovo

Russian troops continue active military operations in the south of Ukraine....

Power outage schedules will be in effect for several more weeks - Yuriy Boyko

The situation with the stability of electricity supply in Ukraine remains difficult, and...

How bloggers and the authorities of Odesa leaked strategic information to the enemy

After another missile attack on Odesa, the network appeared...

The President's office plans to recruit young people to assault brigades for financial compensation

The Office of the President of Ukraine is considering the possibility of introducing financial incentives for...

Anatoly Tymoshchuk won the trial against UAF and returned his titles

Ukrainian football player and coach of the Russian club "Zenit" Anatoly Tymoshchuk...

The Defense Procurement Agency overpaid UAH 215 million for drones of a company with a perfume business

The Defense Procurement Agency was at the center of a scandal over overpayment...