Global Dialogue on Border Carbon Adjustments

The report analyzes the economic exposure of Brazil to the EU's CBAM, noting that while current impacts are limited to specific sectors like iron and steel, the diffusion of BCAs to other major markets like the US and Japan poses a significant risk. It details the responses of the Brazilian government and the National Confederation of Industry (CNI), highlighting concerns over non-discrimination, administrative burdens, and the need for developed countries to finance technological adaptation in developing nations. The document also notes a general lack of broad public and financial sector engagement with the BCA debate in Brazil.

• The economic impact of the EU's CBAM on Brazil is currently limited because the affected exports represent only 0.15% of the country's GDP. In 2022, just over USD 3 billion of Brazilian exports were estimated to be affected, with the iron and steel sector accounting for 92% of the value of these exports.
• While the EU market is not a primary destination for many of Brazil's CBAM-affected products, the potential adoption of BCAs by other trading partners presents a greater risk. The United States absorbs nearly 50% of Brazilian Chapter 72 (cast iron, iron, and steel) exports, and Japan accounts for 30% of Brazilian foreign sales of aluminum.
• The Brazilian government and the National Confederation of Industry (CNI) have raised concerns that CBAM may violate WTO non-discrimination principles and the international environmental law principle of 'common but differentiated responsibilities'.
• Stakeholders in Brazil argue that the EU CBAM's focus on direct emissions (Scope 1) ignores Brazil's comparative advantage in renewable energy. They suggest that for a BCA to effectively reduce greenhouse gas emissions, it should incorporate Scope 2 and Scope 3 emissions.
• Brazilian stakeholders recommend that developed countries implementing BCAs should use the collected revenues to finance technological adaptation in developing countries to mitigate the disproportionate impact on those nations.
• The debate over BCAs in Brazil is described as limited, with a defensive stance from the government and low engagement from the private financial sector and labor unions. The report notes that Brazil has not yet implemented an emissions trading system (ETS) or a comprehensive data monitoring system for emissions.

APA

International Institute for Sustainable Development (2024). Global Dialogue on Border Carbon Adjustments. https://www.iisd.org/system/files/2024-07/border-carbon-adjustments-brazil.pdf

Chicago

International Institute for Sustainable Development. Global Dialogue on Border Carbon Adjustments. 2024. https://www.iisd.org/system/files/2024-07/border-carbon-adjustments-brazil.pdf.

Wikipedia

{{cite report |author=International Institute for Sustainable Development |title=Global Dialogue on Border Carbon Adjustments |date=July 2024 |url=https://www.iisd.org/system/files/2024-07/border-carbon-adjustments-brazil.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{internationalinstituteforsustainabledevelopment2024global, author = {{International Institute for Sustainable Development}}, title = {{Global Dialogue on Border Carbon Adjustments}}, institution = {International Institute for Sustainable Development}, year = {2024}, month = jul, url = {https://www.iisd.org/system/files/2024-07/border-carbon-adjustments-brazil.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }