CBAM risks for non-EU countries still underestimated
The ripple effects of the Carbon Border Adjustment Mechanism (CBAM) will extend far beyond the European Union's borders, creating significant and still widely underestimated economic risks for nations without their own carbon pricing policies. That was the stark warning delivered by Marcel Duits, Chief CBAM Officer of Dubrink, during a recent CBAM conference in Belgrade.
Speaking to an audience of industry leaders and policymakers, Duits detailed a looming two-sided pressure that threatens to disrupt unprotected markets and penalize transitioning industries.
The looming threat of carbon dumping
The primary risk, Duits explained, stems from the displacement of carbon-intensive goods. As the EU’s CBAM makes it economically unviable for high-emission products to enter its market, producers will aggressively seek alternative destinations for their goods.
“Highly polluting producers that can no longer access the EU market will start dumping their goods in markets without CBAM protection,” Duits said. This influx of ultra-cheap, carbon-intensive products threatens to destabilize local pricing, undercut domestic producers, and saturate markets, creating an uneven playing field.
A squeeze on local industries
This external pressure is compounded by a second, internal challenge. Many factories in non-EU countries are actively working to lower their emissions but have not yet achieved the levels required for competitive entry into the EU.
This creates a punishing double bind:
Their products remain uncompetitive for the EU market due to impending CBAM costs, effectively closing off a major export channel.
Simultaneously, they face a surge of intense competition in their home market from the dumped, high-emission imports.
“The financial implications are real and still widely underestimated,” Duits stressed. This scenario traps well-intentioned local industries between a lost export market and an embattled domestic one, jeopardizing their financial stability and decarbonization efforts.
A strategic path forward with Forecasting
Navigating these complex cross-currents requires foresight and strategic planning. To empower businesses to proactively address these risks, Dubrink has developed a powerful forecasting tool designed to provide critical clarity.
This tool helps companies map both their current emissions profiles and their potential future CBAM-related costs. By modeling financial exposure under various scenarios, businesses can anticipate market shifts, understand their competitive standing, and develop a robust, forward-looking strategy to mitigate risk and identify opportunities.
As the global trade landscape is reshaped by climate policy, Dubrink is committed to providing the strategic tools and insights necessary for businesses to not only comply with regulations but to thrive in a new economic reality.
For more information, visit dubrink.com/meet.