Legal Implications of the Use of Export Taxes in Addressing Carbon Leakage: Competing Border Adjustment Measures

The prevailing uncertainties about the future of the post-Kyoto international legal framework for climate mitigation and adaptation increase the likelihood of unilateral trade interventions that aim to address climate policy concerns, as exemplified by the controversial European Union initiative to include the aviation industry in its emissions trading system. The emerging literature suggests that border carbon adjustment (BCA) measures imposed by importing countries would lead to substantial legal complications in relation to World Trade Organization law and hence to possible trade disputes. Lack of legal clarity on BCAs is exacerbated by potential counter or pre-emptive export restrictions that exporting countries might impose on carbon-intensive products. In this context, this paper investigates the interface between legal and welfare implications of competing unilateral BCA measures. It argues that carbon export taxes will be an inevitable part of the future climate change regime in the absence of a multilateral agreement. It also describes the channels through which competing BCAs may lead to trade conflicts and political complications as a result of their distributional and welfare impacts at the domestic and global levels.

Germania: l’indomabile trading state

Basato su interviste con i principali attori tedeschi e su un’analisi della letteratura, l’articolo analizza lo sviluppo recente dell’economia tedesca e la strategia tedesca nell’affrontare la crisi dell’eurozona. La Germania è uno stato commerciale (trading state), la cui crescita è fortemente trainata dalle esportazioni. Fino agli anni novanta, rigidità istituzionali forti, nel sistema di relazioni industriali e nel sistema di protezione sociale, contribuivano a conciliare lo sviluppo delle esportazioni con una crescita armonica dei consumi interni, contribuendo cosi a ingabbiare la «tigre» tedesca. A partire dagli anni novanta, sia le relazioni industriali sia la protezione sociale sono state fortemente liberalizzate, stimolando ulteriormente la competitività estera e indebolendo i consumi interni. Il modello economico tedesco, cosi come è venuto profilandosi negli ultimi dieci anni, è alla base delle politiche di austerità che la Germania impone all’Europa. Tali politiche sono fortemente condivise dai partiti politici, dagli attori sociali e dall’opinione pubblica, e le probabilità che la strategia tedesca cambi sono minime.

The Crisis and Germany: The Trading State Unleashed

Based on interviews with the main German actors and on secondary sources, the article examines the recent development of the German political economy, and the German strategy vis-à-vis the Euro zone. Germany is a trading state whose economic growth is strongly export-led. Until the years 1990s, strong institutional rigidities, both in industrial relations and in the welfare state, contributed to reconcile export growth with household consumption, thus keeping the German “tiger” on a leash. From the early 1990s on, however, both industrial relations and social protections have been strongly liberalized, thus further stimulating external competitiveness and reducing the role of consumption in the German growth model. The unleashed trading state shapes the German response to the Euro crisis and the austerity policies that Germany imposes to Europe. These policies are strongly supported by political parties, social actors, and public opinion in Germany, and the likelihood that they change in the near future is minimal.