GTAP Resources: Resource Display
| GTAP Resource #7518 |
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"Trade Liberalization and Carbon Taxes: A Study of Impact of AfCFTA and CBAM on African Economies" by Narayanan, Badri, Simon Mevel, Stephen Karingi and Karthikeyan Chandramohan Abstract Though Africa’s current and foreseen contributions to GHG emissions is a moderate fraction of total emissions, the African economies are some of the most vulnerable regions to climate change. The decarbonisation agenda is therefore even more critical for African economies than for others at this time when Africa is spearheading its focus on sustainable economic development and growth. This provides an opportunity to Africa to build a low-carbon manufacturing hub from the bottom up (Lyes, B. et al., 2021). The implementation of the Agreement establishing the African Continental Free Trade Area (AfCFTA), which is expected to provide an impetus to Africa’s development with trade as a key driver, has also raised concerns that it could contribute to climate change on account of its effects from higher manufacturing to increased transport demand. EU Carbon Border Adjustment Mechanism (CBAM) ensures pricing of carbon emitted during the production of energy-intensive goods that are imported into any region. This may lower emissions in the non-EU countries that are trading partners to the EU, like African countries. It should be noted that in case the importers have already paid a carbon price in the home country, they are offered exemptions (Cosbey and Baršauskaite, 2023). Using Computable General Equilibrium (CGE) modelling framework, this study aims to address research gaps, through a triple objective: (1) to assess how the implementation of the EU CBAM will impact the trade and economic interests of African countries, including its possible implications for AfCFTA implementation; (2) to explore whether or to what extent the foreseen increase in intra-African trade to result from AfCFTA implementation may mitigate the anticipated adverse impact of CBAM on African exports to the EU; (3) to explore whether and how the adoption by Africa of its own carbon pricing instruments may help mitigate the impact of the EU CBAM on Africa. |
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- Climate change policy - Climate impacts - GTAP Data Base and extensions - Supply chains - Model extension/development - Africa (Central) - Africa (East) - Africa (North) - Africa (Southern) - Africa (West) |
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Public Access  Paper (668.8 KB) Replicated: 0 time(s)Restricted Access No documents have been attached. Special Instructions No instructions have been specified. |
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Last Modified: 9/15/2023 2:05:45 PM
