My Daily Advertiser Op Ed column for Tuesday 23 February 2021
ScoMo weaponising ‘Climate Tariffs’
Australia will push back against Britain’s sensible moves to establish climate tariffs. Scotty from Marketing’s government will argue the sanctions would be a new form of “protectionism” designed to shield local industries from free trade. The ghost of Tony Abbott will also no doubt whisper ‘carbon tax’ into their ears, as incorrect a statement now as it was during the Gillard government.
The issue could come to a head at the G7 summit in Britain in June, which Prime Minister Scott Morrison has been invited to attend. British Prime Minister Boris Johnson has indicated it would be a key priority at the meeting of the world’s leading economies.
Johnson, riding a new wave of environmental momentum following the election of US President Joe Biden, has directed British government departments to come up with options for carbon border levies. He wisely believes they could act as a global emissions trading scheme as the world strives to hit net-zero emissions by 2050.
Carbon tariffs are imposed on energy-intensive imports that continue to trigger heated international debates. The European Union has advocated for them to be applied on imported goods that are produced in countries with weaker climate laws. It has already committed to imposing them by 2023, which is likely to include products made with Australian raw materials.
Mr Biden could also impose climate tariffs, with his “Buy American” economic plan endorsing a “carbon adjustment fee” at the border.
ScoMo’s government will argue carbon tariffs are not aimed at combating climate change, but rather at economic objectives including protecting local industries such as meat, cheese and wine.
Craig Emerson, a former Labor trade minister, said the EU and Britain were advanced in plans to apply the levies and the Biden administration would likely follow. He said carbon tariffs would not amount to protectionism and would be compliant with the World Trade Organisation’s rules if they were set at the correct rate.
“You have to design the mechanisms and set a rate so that it is sufficient to avoid carbon leakage, while not being in excess of that level which could constitute a form of protectionism and be non-compliant with WTO obligations,” he said.
Australia, Britain and the EU are in the early rounds of negotiating trade agreements. Australia is pushing back against any attempt to insert penalties or compliance mechanisms on climate into the deal, according to sources familiar with the negotiations.
However, Europe will urge Australia to increase its 2030 emission reduction pledge in the lead-up to this year’s UN (Glasgow) climate conference, with the EU ambassador in Canberra saying all countries should embrace “more ambitious and emboldened” policies, the Guardian Australia reported.
Rather than take action on both counts, prime minister Scott Morrison is wrestling with internal dissent over the possibility of Australia embracing date-based emissions targets. The Nationals are mounting a campaign against a target date that is yet to be announced, let alone backed by a mechanism to get there.
Our own Michael McCormack, currently leader of the Nationals and therefore the Deputy Prime Minister, has recently been stridently telling all and sundry, including the PM, that agriculture must be excluded from any action to reduce our carbon emissions. Presumably McCormack thinks he his shoring up his base, i.e. farmers. Perhaps he should listen to the National Farmers Federation (NFF), which is committed to zero emissions by 2050.
Or perhaps McCormack is shoring up his other base, those coal-loving MPs on the Nationals back bench, ever ready to topple him from the leadership: Barnaby Joyce, Matt Canavan, George Christiansen, and Bridget (Sports Rorts) McKenzie.
NFF President Fiona Simson said the strengthening of the NFF’s climate goals was a strong reminder of the role farmers already played in tackling emissions.
“Australia’s farm sector continues to be a leader in reducing greenhouse gas emissions,” Ms Simson said. “In the past decade, agriculture has consistently reduced its emissions intensity and net emissions within the Australian economy. The red meat sector, for example, has a target of being carbon neutral by 2030 and is already making great headway on research and new technologies that will enable that transformation.”
“There is a huge potential for Australia to be a global leader in low-emissions agriculture,” Ms Simson concluded. Pay attention, Mr McCormack and colleagues.