The Thai Rubber Association (TRA) has been closely monitoring the European Union’s implementation of the Carbon Border Adjustment Mechanism (CBAM). The latest developments were presented at the Asia Climate Summit (ACS) 2025, hosted by Thailand from July 8–10, which brought together over 800 participants from across the Asia-Pacific region and around the world. According to the summit, while many countries initially responded with resistance or adopted a "wait-and-see" approach, a notable shift is now underway. For instance, India, Japan, and China have begun developing their own Emissions Trading Schemes (ETS), while Australia, the United Kingdom, and Brazil are either considering or actively formulating their own Border Carbon Adjustment (BCA) policies. International responses to CBAM have varied significantly over time, reflecting broader trends in global carbon pricing. These developments offer valuable insights into the future trajectory of CBAM implementation and the challenges that lie ahead. The future trajectory of CBAM will be shaped by several key factors: (1) the international recognition of carbon pricing mechanisms; (2) the effectiveness of CBAM in preventing carbon leakage as free quota allocations are gradually phased out; and (3) the interoperability between emerging Border Carbon Adjustment (BCA) mechanisms within an increasingly multipolar global landscape.

News reports indicate that the CBAM legislation expands the list of covered products to include organic chemicals, plastic polymers, hydrogen, and ammonia—adding to the existing five categories: cement, iron and steel, fertilizers, aluminum, and power generation. The scope of carbon emissions covered under CBAM has also broadened to include indirect emissions, such as electricity consumption during the manufacturing process, for all nine product categories. Previously, only direct emissions were accounted for. A transitional period for emissions data reporting is in place from January 1, 2023, to December 31, 2026. Starting January 1, 2026, all products exported to the European Union must report their carbon emissions, although they will still benefit from free quota allocations. However, by 2034, the EU will phase out free quotas entirely, and exporters will be required to pay a specified rate for all reported carbon emissions.

The Thai Rubber Association (TRA) will continue to monitor the progress of EU environmental measures and legislation, and will keep our members informed to facilitate preparedness for CBAM and other regulations that may affect Thai rubber and rubber-based product exports to the EU. This proactive approach will also contribute to enhancing Thailand’s environmental standards through a holistic approach, promoting both economic and environmental sustainability in the long term.

Mr. Veerasith Sinchareonkul

President

The Thai Rubber Association