Abstract:

Purpose: The main purpose of the study is to examine the possible impact of the Carbon Border Adjustment Mechanism (CBAM) which is the regulation of the Fit for 55 Package that released in 2021 on the trade in goods and services between Turkey and the EU-27 that is one of the most important trade partners of Turkey. Methodology: In the study, the possible carbon cost that may arise during the entry of the products imported into the EU-27 market from Türkiye to the EU-27 customs area was calculated using the Input-Output Analysis. For this purpose, Türkiye's sectoral export values have been compiled from the official website of TURKSTAT and sectoral greenhouse gas emission values have been compiled from the Greenhouse Gas Emission Inventory Report published by TURKSTAT. Findings: As a result of analysis, the possible carbon cost of Turkish export to the EU-27 may exceed 3,3 billion Euros annually if the unit carbon price pursue at the level of 2022. In addition, the highest export revenue decrease risk is seen on cement and followed by electricity, other mineral products, agriculture and agriculture sectors. Originality: There are very few studies analyzing the possible impact of CBAM, which will start the transitional period in 2023, between Türkiye and EU-27 international trade. Besides, this study also includes analyzes using the current average emission price per ton in 2022.

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