Back from the dead: carbon tariff plan for EU imports

The row over including the greenhouse gas emissions from civil aviation under the European Union’s Emissions Trading Scheme (EU-ETS) notwithstanding, France’s new government wants to the EU to impose a carbon tax on goods imported from outside Europe.

The idea is not new, having originally been floated by the European Commission in 2008 and championed by former French President Nicolas Sarkozy ahead of the 2009 Copenhagen climate summit. At the time it was dismissed as being overtly protectionist.

France’s the newly appointed Minister for Industrial Revival, Arnaud Montebourg, a fierce campaigner against globalization, used his first interview in office to outline the plans he said would protect Europe’s industry from competitors in countries such as China, which have no equivalent to the EU’s CO2 emissions limits.

Speaking on French public television, Montebourg claimed the idea is “already on the agenda of the European Commission".

France has circulated a briefing note to the EU explaining the scheme, rebranded as the "carbon inclusion mechanism", which would require importers of goods manufactured outside Europe to buy carbon permits from the EU-ETS.

To face down claims of protectionism, Paris said the revenues raised could be used to fund low-carbon projects in developing countries. EU-ETS revenue from the aviation industry will flows into the coffers of EU member states.

It remains to be seen, however, whether the current proposal will make anymore headway than its predecessor did in 2008-9. In his TV interview, Montebourg expressed confidence that mindsets were changing in Europe following the financial and sovereign debt crises.

The European Commission appeared to bow to French pressure earlier this year when it tabled plans earlier requesting "reciprocity" in trade deals with foreign nations such as China.