Border Carbon Adjustments: What risk for South African exporters?

The analysis indicates that South Africa is vulnerable to border carbon adjustments (BCAs) from the US and EU, with potential annual charges of €380 million and US$210 million respectively. The non-ferrous metals and iron and steel sectors are the most exposed, facing ad valorem tax equivalents exceeding 10%. To mitigate these risks, the document suggests South Africa could pursue WTO redress or negotiate sectoral emissions reduction agreements to gain exemptions.

• South Africa is highly vulnerable to the BCA regimes proposed in the U.S. America Clean Energy and Security Act (ACESA) because none of the available country-level or sector-level exemptions would apply to it.
• Based on 2009 export data and a carbon price of US$20/tonne, South African exports to the EU would face annual charges of approximately €380 million, while exports to the U.S. would face charges of US$210 million.
• The non-ferrous metals and iron and steel sectors are the most significantly impacted. In the EU, these sectors face an ad valorem tax equivalent of over 10%, with the highest payments coming from iron and steel (€104 million), gold (€89 million), and platinum (€80 million). In the U.S., non-ferrous metals (primarily gold and platinum) would make the highest payment at US$159 million.
• Covered goods represent a substantial portion of total exports in several key sectors: 27.3% for non-ferrous metals, 21.3% for iron and steel, 12% for paper, pulp and print, 11.8% for chemical and petrochemical, and 11.2% for textile and leather.
• While South Africa could seek redress through the World Trade Organization (WTO), the document warns that such disputes take years to resolve and the outcome is uncertain.
• A viable alternative to avoid BCA charges is for South Africa to sign sectoral emissions reduction agreements with the U.S. and EU. Acceptable measures to secure exemptions could include a carbon tax, a cap-and-trade scheme, sectoral caps, or a green purchase obligation for green power.

APA

Cosbey, A., & Wooders, P. (2011). Border Carbon Adjustments: What risk for South African exporters? International Institute for Sustainable Development. https://www.iisd.org/system/files/publications/tri_cc_border_carbon.pdf

Chicago

Cosbey, Aaron, and Peter Wooders. Border Carbon Adjustments: What risk for South African exporters? International Institute for Sustainable Development, 2011. https://www.iisd.org/system/files/publications/tri_cc_border_carbon.pdf.

Wikipedia

{{cite report |last1=Cosbey |first1=Aaron |last2=Wooders |first2=Peter |title=Border Carbon Adjustments: What risk for South African exporters? |publisher=International Institute for Sustainable Development |date=August 2011 |url=https://www.iisd.org/system/files/publications/tri_cc_border_carbon.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{cosbey2011border, author = {Cosbey, Aaron and Wooders, Peter}, title = {{Border Carbon Adjustments: What risk for South African exporters?}}, institution = {International Institute for Sustainable Development}, year = {2011}, month = aug, url = {https://www.iisd.org/system/files/publications/tri_cc_border_carbon.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }