African Development Bank Group’s president criticizes EU carbon border tax

The African Development Bank Group’s president has complained that Africa could lose up to $25bn each year as a result of the European Union’s new EU’s Carbon Border Adjustment Mechanism.

Akinwumi Adesina warned that the measure – which taxes carbon-heavy goods such as fertilizers and iron with the aim of promoting clean technologies – will harm the continent’s trade and impede its industrial development.

Adesina remarked that ‘With Africa’s energy deficit and reliance mainly on fossil fuels, especially diesel, the implication is that Africa will be forced to export raw commodities again into Europe, which will further cause de-industrialization.’

He continued by saying that ‘Africa has been short-changed by climate change; now it will be short-changed in global trade.’

Adesina also pointed out that, according to data from the International Renewable Energy Agency, Africa has been overlooked in the global energy transition.

He noted that ‘Africa received just $60bn, or 2%, of the $3tn of global investments in renewable energy in the past two decades, a trend that will now impact negatively on its ability to export competitively into Europe.’

The EU’s Carbon Border Adjustment Mechanism entered into effect on October 1 of this year; the transitional phase will run until the end of 2025.