As countries and territories worldwide aim for carbon neutrality by 2050, carbon pricing policies are emerging as a crucial tool in achieving this target. By proactively adapting to this global trend, businesses can optimize costs while fulfilling environmental expectations of customers and investors. Carbon pricing Carbon pricing has emerged as a vital policy tool for addressing climate change in many countries and territories. The first carbon tax was introduced by Finland in 1990. By May 2020, 82 carbon tax initiatives were launched across 48 countries and territories. Beyond individual national policies, the European Union introduced carbon taxation in 2005 and, more recently, initiated the Carbon Border Adjustment Mechanism (CBAM). Piloted from October 1, 2023, and set for full implementation by 2026, CBAM imposes carbon tax on certain goods shipped to the EU, based on their production-related greenhouse gas emissions. Initially, this mechanism targets six sectors: iron and steel, aluminum, cement, fertilizer, electricity, and hydrogen. If a domestic carbon pricing system is implemented with industry emissions remaining at current levels, the EU’s CBAM alone could decrease Vietnam’s GDP by up to US$6.4 billion in 2030 and US$11.1 billion in 2035, according to the Ministry of Industry and Trade. The impact could […]
To read more, please click here.
