Canada Government launches consultations on border carbon adjustments

Ottawa: Today, the Deputy Prime Minister and Minister of Finance, the Honourable Chrystia Freeland launched consultations on border carbon adjustments, in cooperation with the Minister of Environment and Climate Change, the Honourable Jonathan Wilkinson. To provide context, the government is also releasing today a paper that outlines foundational information and key considerations relating to border carbon adjustments.

Combatting climate change is a global imperative. Canada is doing its part by committing to ambitious climate targets and raising its price on carbon pollution to meet those targets. An emerging global challenge is how to address differing carbon prices among trading partners and more generally, differences in the tools nations use to address the challenge of climate change.

Border carbon adjustments can level the playing field by ensuring that imported goods are subject to the same carbon pricing as domestically produced goods and that exported goods are not disadvantaged in markets with lower, or no, carbon pricing. This, in turn, helps prevent potential carbon leakage, supports emissions reduction, and maintains Canada’s global competitiveness.

Work on international border carbon adjustments is in progress. An important part of advancing this work is ensuring a common understanding. To this effect, the government will continue its important conversations with Canadians and international partners, including the United States and European Union, in the coming months.

As announced in Budget 2021, the government will have targeted discussions with the provinces and territories, importers and exporters—especially those who deal in emissions-intensive goods—as well as other experts in the coming weeks. Throughout this process, the government will continue to advance its international engagement with key trading partners and other like-minded countries that are taking climate action. Broader public consultations with all interested Canadians will also take place this fall.

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