The German steel association Wirtschaftsvereinigung Stahl (WV Stahl) said that significant improvements have been made to the document since the European Parliament approved its position on the carbon adjustment mechanism at the border (CBAM). However, according to the industry association, key gaps still remain.
Kerstin Maria Rippel, Managing Director of WV Stahl, welcomed the decision to include the approved amendments in the upcoming trilateral negotiations with the European Commission and the EU Council. She stressed that the parties need to quickly work out a sustainable and practical compromise.
The association believes that CBAM should be extended to a wider range of steel products than the one currently proposed by the European Commission.
WV Stahl warned that if the scope of the mechanism is not significantly expanded, the risk of carbon leakage may move further down the value chain. In this case, the production can leave the EU, and the problem itself will not be solved.
Separately, the association pointed out the need to effectively prevent possible circumvention schemes provided for by CBAM.
Another important issue that, according to WV Stahl, the European institutions will have to solve remains the costs associated with carbon emissions from exports from the EU.
Rippel noted that European manufacturers still incur additional costs when shipping abroad, while some competitors in global markets do not face comparable costs. This, according to the association, may weaken the position of European companies, lead to a loss of market share and the transfer of production and emissions outside the European Union.
In this regard, W.
V. Stahl called for the next stage of negotiations to prepare a legally reliable export protection mechanism in accordance with the rules of the World Trade Organization. The association believes that such a tool is necessary for CBAM to simultaneously meet the EU's climate goals and maintain the competitiveness of European industry.