General

Compared with the recent Russian-Ukrainian conflict, high inflation in many countries around the world, and the food and energy crisis, carbon tariffs are somewhat eclipsed. However, in the long run, climate change, green and low carbon are still one of the important factors affecting the international business of Chinese enterprises. As far as the draft amendments to the EU Carbon Border Adjustment Mechanism (CBAM) have been reviewed and approved by the European Parliament recently, although there is still some time before it takes effect, its impact cannot be underestimated.

It is understood that CBAM has expanded the scope of industries from steel, aluminum, cement, fertilizer, and electricity to organic chemicals, plastics, hydrogen, and ammonia, and has also included indirect emissions (emissions from electricity consumption) from imported products into the scope of taxation. The transition period was shortened from 10 years to 5 years. The adoption of this amendment will, on the one hand, help the EU to compete for the global dominance of addressing climate change and promote the global joint response to climate action; , strengthen the EU's central position in the global carbon pricing mechanism. In addition, this may also form a demonstration effect, allowing developed countries such as the United States and the United Kingdom to further accelerate the pace of formulating carbon tariff rules.

The EU has always been my country's important trading partner, especially in recent years, the EU and ASEAN have often been firmly seated as China's top two trading partners. According to data from the General Administration of Customs, in the first five months of this year, the EU was my country's second largest trading partner, and my country exported 1.45 trillion yuan to the EU. Studies have shown that although the proportion of EU's cement and steel products imported from China is not large, as the world's largest producer of steel, aluminum and cement, once these industries seek to export to the EU, the additional carbon tax costs will account for 17%, 20%, 17% of the export value. In addition, although China's current exports of automobiles, solar photovoltaic panels, electronic products, mechanical parts, furniture, toys, clothing and other terminal composite products to the EU will not be affected, if CBAM expands the scope of carbon tax coverage, indirect emissions and more Product taxation, which will affect the export of Chinese products to the EU.

Although my country has practiced the concept of green and low-carbon development earlier, and clearly put forward the "dual carbon" goal in 2020, and the national carbon market will officially open in 2021, it will further improve the national carbon market and cooperate with the global carbon market. There are still many difficulties at the operational level in order to achieve mutual recognition of the market and form a unified global market. It is difficult to quench thirst in the near future. For Chinese companies, the most effective way is to continue to pay attention to the progress of carbon tariff policies in developed countries and regions in Europe and the United States, be prepared to adjust the layout of the supply chain, and actively build a green supply chain.

In the short term, building a green supply chain should start with green procurement. Chinese enterprises need to carefully study the carbon tariff texts that will be issued by the European Union and the United States, conduct self-inspection on supply chains and products in a timely manner, and implement relevant standards in the procurement and production process in a timely manner. suppliers, especially to strengthen cooperation with local suppliers in Europe, to achieve low-carbon and environmental protection in the procurement process. Further, select suppliers who can provide high-quality green products and services to form stable and long-term cooperative relationships, and promote the formation of green supply chains in green materials, green procurement, green production, green sales, green transportation, green packaging, etc., Therefore, while realizing the all-round green and low-carbon supply chain of its own, it also drives the upstream and downstream enterprises in the supply chain to realize green and low-carbon transformation. In addition, it is also possible to consider increasing investment in Europe and adopting a method of production close to the market to avoid high carbon tariffs.

From a long-term perspective, Chinese enterprises should start from establishing green concepts, establishing green strategies, researching and developing green technologies, exploring green business models, and planning green scenarios to make arrangements for long-term development. For example, Chinese companies can strengthen cooperation with multinational companies. Multinational companies are not only experienced in responding to policy changes, including carbon tariffs, but also play a role in driving the industrial chain. With their help, Chinese companies can achieve Green transition. In this regard, mining giant Rio Tinto, while setting its own carbon reduction targets, is also working with Chinese steel mills, research institutes, technology companies and other parties to optimize production processes and help drive a carbon-neutral transition across the value chain. It is worth emulating.

In addition, it is also very important to make good use of digital means and make policy announcements. Chinese enterprises need to rely on digital means to monitor the greenness of the supply chain and proactively disclose information, especially in combination with the audit of carbon footprint and carbon emissions, so that the green and low-carbon efforts of enterprises can meet relevant standards while also meeting relevant standards. Realize visualization, so that regulators and partners can better understand their green development.

On the whole, some Chinese enterprises have already realized the awareness of green economy and made some meaningful explorations, but they want to cope with the upcoming wave of green and low-carbon country trade and become a truly green international enterprise. From "light green" to "dark green", there is still a long way to go.