7th Jul 2022


African economies risk suffocation by 'shock' carbon tax

  • The French EU presidency called the carbon border tax a 'victory for European climate policy', back in March (Photo: Zach Stern)
Listen to article

The climate is surely one area where the European Union and African Union should be in step with one another. Curbing global warming and agreeing how to produce clean power would help keep more of the world habitable and prosperous.

Worryingly, however, policy differences between Europe and Africa have been widening.

Read and decide

Join EUobserver today

Become an expert on Europe

Get instant access to all articles — and 20 years of archives. 14-day free trial.

... or subscribe as a group

  • Kenya, a major agricultural producer, already generates the majority of its energy needs from renewables, mostly hydropower (Photo: European Commission)

Africans increasingly see Europeans as indifferent to their need to develop their economies and shake off the poverty that leads many Africans to embark on difficult migration journeys, both within Africa and to Europe.

The EU agreement on the Carbon Border Adjustment Mechanism (CBAM) reached on 15 March has been described a "victory for European climate policy" by Bruno Le Maire, French finance minister, representing the French EU presidency.

The carbon tax will give the EU a tool to speed up the decarbonisation of European industry, while protecting it from countries with less ambitious climate goals and "also incentivise other countries to become more sustainable and emit less," said Le Maire.

But Faten Aggad is sceptical. The senior advisor at the African Climate Foundation, an organisation that channels philanthropy into efforts to protect the climate, she says that under the CBAM, African exporters that do not meet EU-set standards would have to pay extra for their goods to reach the European market.

What some Africans now are bracing for is a carbon "shock," where EU tariffs would end up "suffocating some African economies," she warns. The ability of African countries like Egypt, Nigeria and Algeria to continue their industrialisation could be severely impacted.

Aggad is also adamant that Africans see hypocrisy and double standards in Europeans' repeated refusal to make a rapid break with coal, oil and natural gas while charging ahead with grand plans to push other parts of the world like Africa towards carbon-reduction.

Guinea pig?

"There is a question as to whether Europe is actually using Africa as a guinea pig, even while its own power consumption patterns, and in general, its consumption pattern aren't seriously put into question," says Aggad.

She cites the example of The Netherlands, which generates around 12-percent of its energy from clean energy despite its capabilities of generating far more than that from wind resources. Kenya, which is also a major agricultural producer, already generates the majority of its energy needs from renewables, mostly hydropower.

Europe should do more to craft policies that support African countries that already have renewables, so that they can build more of them, as well as allow other African countries to decarbonise in ways that consider their levels of indebtedness and high costs of borrowing that they face — not to mention their historical circumstances, she says.

But Europe may already be reneging on a grand bargain reached among wealthier, industrialised countries and poorer, developing countries under the Paris Agreement on climate change seven years ago. The idea in Paris, says Aggad, was to ensure that requirements on countries to address the climate should be carefully calibrated, so as not to deepen inequality among countries internationally.

"Now what we see, at least that's the perception, is an attempt by Europe to backtrack on this principle by putting heavy requirements on African countries to push them to move to a European model of decarbonisation," said Aggad. "This is actually growing into a major issue between the two continents."

This article first appeared in EUobserver's magazine, War, Peace and the Green Economy, which you can now read in full online.

Author bio

James Kanter is the creator and producer of the award-winning EU Scream podcast, and journalist formerly with the New York Times and International Herald Tribune.

Activists slam tweak to EU carbon allowance scheme

Ahead of EU environment ministers' meeting, environmental groups sent a joint letter urging ministers to "uphold the 'polluter-pays' principle, as enshrined in EU law when reforming the Emissions Trading System."

EU carbon border tax to target imports from 2026

The European Commission wants to impose an import levy on certain goods produced in third countries with lower environmental standards, from 2026. From 2023 to 2025, importers will only have to report emissions embedded in their goods.

MEPs agree carbon border tax - heavy industries protected

Green groups warned that if heavy industry continues to receive free allowances even after a carbon border levy is in place, this would essentially be a double subsidy for those sectors. "The European Commission must correct this," the WWF warned.

Interview: 'Carbon tax' MEP with one eye on Mozambique

Dutch MEP Mohammed Chahim is rapporteur forthe proposed carbon tax on imported goods which is planned to come into force in 2026. It is one of the biggest and most complex legislative proposals Europe has ever drawn up.

MEPs raise ambition on EU carbon market reform

MEPs on the environment committee agreed on reform of the European carbon market — including expanding it to buildings and transport. They also want to extend the scope of the carbon border tax, and phase out free permits by 2030.

War, Peace and the Green Economy

This magazine is about the world's collective and potentially transformational journey towards a green economy. It is also about taking the reader on what we hope is a fascinating "green voyage" across Europe, Africa and China.

News in Brief

  1. Report: British PM Johnson to resign today
  2. British PM defiant amid spate of resignations
  3. France says EU fiscal discipline rules 'obsolete'
  4. Russia claims untouchable status due to nuclear arsenal
  5. Catalan MEPs lose EU court case over recognition
  6. 39 arrested in migrant-smuggling dragnet
  7. France to nationalise nuclear operator amid energy crisis
  8. Instant legal challenge after ok for 'green' gas and nuclear

Stakeholders' Highlights

  1. Nordic Council of MinistersNordic and Canadian ministers join forces to combat harmful content online
  2. Nordic Council of MinistersNordic ministers write to EU about new food labelling
  3. Nordic Council of MinistersEmerging journalists from the Nordics and Canada report the facts of the climate crisis
  4. Council of the EUEU: new rules on corporate sustainability reporting
  5. Nordic Council of MinistersNordic ministers for culture: Protect Ukraine’s cultural heritage!
  6. Reuters InstituteDigital News Report 2022

Latest News

  1. Is Orban holding out an olive branch to EPP?
  2. EU should freeze all EU funds to Hungary, says study
  3. Legal action looms after MEPs back 'green' nuclear and gas
  4. EU readies for 'complete Russian gas cut-off', von der Leyen says
  5. Rising prices expose lack of coherent EU response
  6. Keeping gas as 'green' in taxonomy vote only helps Russia
  7. 'War on Women' needs forceful response, not glib statements
  8. Greece defends disputed media and migration track record

Join EUobserver

Support quality EU news

Join us