Environmental tax for Ukraine: European Parliament suggests considering the military context

The Member of the European Parliament visited Ukraine to discuss the impact of the CBAM eco-tax on the metallurgical industry.

Karin Karlsbro, Vice-Chair of the European Parliament’s International Trade Committee, discussed the impact of the Carbon Border Adjustment Mechanism (CBAM) with metallurgical representatives during her visit to Ukraine. According to her, this mechanism creates financial and technical difficulties for Ukrainian producers amid the ongoing war.

Karlsbro visited the metallurgical enterprises of “Metinvest,” where the issues of trade support between Ukraine and the EU, postponement of CBAM implementation, as well as the possibilities of decarbonization and the integration of the Ukrainian metallurgical industry into the European market, were discussed. She noted that the Ukrainian metallurgy continues to operate despite constant shelling, energy, and logistics problems, and plays an important role in the country’s economic resilience.

The European side received proposals from “Metinvest” regarding the temporary exemption of imported goods from Ukraine from the financial element of CBAM during wartime. Meanwhile, Ukraine is ready to maintain reporting within the mechanism, and in the future, after the end of the war, discuss new approaches to financing decarbonization. This could include the use of CBAM payments to purchase European equipment to promote the production of green steel and energy.

Karlsbro emphasized the need to consider the role of Ukrainian metallurgy in the European economy. She noted that in wartime conditions, Ukrainian industry not only protects itself but also helps maintain the overall economic and security balance of Europe.

Previously, the European Parliament has already discussed the possibility of revising CBAM for Ukraine, emphasizing the need to develop special regimes or exceptions in response to the challenges of full-scale war.