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Climate policies can have disproportionate impacts on countries, depending on their ability to design, implement, and execute them. While developed nations are better equipped to adapt to and manage the climate transition, developing countries often face greater economic, environmental, and social challenges. To avoid exacerbating these inequalities, climate strategies like carbon pricing must be implemented with justice in mind. One such initiative is the European Union's Carbon Border Adjustment Mechanism (CBAM), which introduces the first-ever carbon border adjustment of this extent. This paper evaluates the potential effects of the CBAM on developing countries that export to the EU, using a multi-method approach that includes desk research, analysis of the CBAM Regulation, participant observation at the European Climate Summit, and expert interviews with EU policymakers. Through thorough analysis, the study contributes to international relations discourse and suggests ways to mitigate the negative impacts of the climate transition on developing countries, recommending that CBAM revenues be used to support climate action in these regions to create an equitable transition.

How Climate Policies Impact Developing Countries: The Case of the European Union Carbon Border Adjustment Mechanism