African economies are preparing for the far-reaching effects of the European Union’s new carbon border adjustment mechanism (CBAM), which is expected to impose tariffs on carbon-intensive imports. The measure, designed to prevent “carbon leakage,” could significantly affect the competitiveness of African exports to Europe.
A new era of trade pressure
The EU’s carbon border tax, which enters its first full phase in 2026, will initially target industries such as steel, aluminium, cement, fertilisers, and electricity. Many African producers rely heavily on fossil fuels for manufacturing and transportation, leaving them exposed to higher levies once carbon costs are factored in. Analysts warn that without substantial investment in cleaner technologies, African exporters could lose market share in Europe, their most important trading partner.
Concerns over fairness and readiness
African policymakers have voiced concern that the CBAM effectively penalises developing economies for lacking the resources to transition to low-carbon production. “This mechanism risks becoming a trade barrier disguised as environmental policy,” said one trade official from the African Union. Several countries, including South Africa, Egypt, and Morocco, are now negotiating for exemptions or transition periods, arguing that they need time and support to adapt.
Calls for climate finance and technology transfer
Environmental economists note that while the EU aims to encourage global decarbonisation, its policy could deepen inequality unless accompanied by climate finance and technology transfer. African states are calling for greater access to renewable energy funding, carbon credit markets, and green technology partnerships to offset the impact. Some nations are also exploring new intra-African trade routes to reduce reliance on EU exports.
Long-term implications
The CBAM represents both a threat and an opportunity for Africa. While it may undermine short-term competitiveness, it could also accelerate investment in clean industries and renewable energy infrastructure. Regional initiatives under the African Continental Free Trade Area (AfCFTA) are expected to play a key role in coordinating responses and promoting green industrialisation.
Newshub Editorial in Africa – 6 November 2025
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