The United Nations climate summit in Belem, Brazil, has become an unexpected battleground for global trade disputes, with tariffs and carbon taxes threatening to overshadow traditional climate discussions.
Electric Vehicles Spark Trade Tensions
Throughout the host city of Belem, the Chinese-made BYD Dolphin Mini has become a common sight, dominating the local electric vehicle market. This successful penetration contrasts sharply with the company's challenges in Europe and complete absence from North American markets.
Trade-restrictive measures now loom large over COP30, with China aggressively pushing for better market access for its green technologies while major developing economies challenge Europe's new carbon border tax.
Carbon Tax Divides Global North and South
The European Union's Carbon Border Adjustment Mechanism (CBAM), which imposes costs on carbon-intensive imports like steel and fertilizer, has emerged as a major flashpoint. Major developing economies including India, Brazil, and South Africa are heavily exposed to these new regulations.
"The Global North, having used carbon-intensive industries to develop themselves, are now throwing up the gates to the Global South," said Mohamed Adow of Power Shift Africa, capturing the sentiment of many developing nations.
Even smaller developing countries whose exports aren't directly targeted by CBAM express concerns about broader measures to come. An African negotiator from a cocoa-exporting country highlighted worries about the EU's paused deforestation regulations as another significant trade barrier.
Trade Takes Center Stage at Climate Summit
Unlike previous climate conferences where emissions targets and climate finance dominated discussions, trade has moved to the forefront at COP30. A draft text issued by the Brazilian presidency on Tuesday listed trade as the second of its four top priorities, signaling its elevated importance.
"Trade, at this COP, unlike previous COPs, has already been elevated," confirmed Li Shuo, director of the China Climate Hub at the Asia Society Policy Institute. "We can already expect that trade will form the most prominent part of the outcome."
The tone was set earlier when Chinese Vice Premier Ding Xuexiang urged countries to "remove trade barriers and ensure the free flow of quality green products." This call comes as the EU imposes steep tariffs on Chinese EVs reaching over 45%, while Canada and the United States maintain even higher barriers exceeding 100%.
A Southeast Asian negotiator noted the frustration among Asian nations who are embracing affordable Chinese green technology to accelerate their energy transitions, finding it "illogical" that Western nations are rejecting similar opportunities.
The EU maintains that CBAM represents climate policy rather than trade protectionism. "Pricing carbon is something that we need to pursue with as many as possible, as quickly as possible," stated the bloc's climate commissioner Wopke Hoekstra, denying that CBAM constitutes a unilateral trade measure.
Despite the tensions, some nations privately acknowledge benefits to the carbon border mechanism. Sweden's Climate Ambassador Mattias Frumerie revealed that some countries welcome CBAM as an incentive to accelerate their decarbonization efforts, even while criticizing it publicly.
As Russia launches a formal complaint against CBAM and other nations like the UK and Canada develop similar mechanisms, experts caution against expecting immediate resolutions. David Waskow of the World Resources Institute noted that while trade will likely appear in the final decision text, no one expects the summit to "magically" resolve these complex disputes.
The intersection of trade and climate policy represents a new frontier in global environmental cooperation, testing whether economic competition and climate ambition can coexist in the race to meet Paris Agreement targets.
