FEU calls on the government to act on the risks of CBAM for the Ukrainian economy

The introduction of the EU carbon tax could lead to a drop in GDP and job losses

The Federation of Employers of Ukraine (FEU) has appealed to the Prime Minister regarding the possible negative consequences of the European Union’s Cross-Border Carbon Adjustment Mechanism (CBAM) for the Ukrainian economy. According to the results of the survey and discussions with business representatives, CBAM can significantly complicate the export of Ukrainian products, cause a drop in GDP and job losses, the letter says.

According to the survey, 54.5% of companies assess CBAM as a threat to their supplies to the EU, and 32.3% consider its impact to be particularly severe. According to forecasts, Ukraine’s GDP may decline by 4.8% by 2026.

The main challenges to adapting to the new rules are the lack of access to the necessary data, the complexity of reporting, and the lack of qualified personnel. Businesses also emphasize the need for government support in implementing green technologies and modernizing production.

The FEU proposes a number of measures, including the creation of a body in Ukraine to support exporters, the development of state aid programs to reduce emissions, and the active participation of the Ukrainian authorities in negotiations with the European Commission on the terms of the CBAM.

The Federation calls on the government to take urgent measures to protect Ukrainian producers and minimize the negative effects of the CBAM, which will help maintain their competitiveness in the European market.

According to CMD-Ukraine, Ukraine may lose 6.4% of its GDP by 2030 as a result of the CBAM, with exports declining by 6.3%, including 9.8% to the EU, and more than 116,000 jobs lost.

At the same time, GMK Center estimates that CBAM may be applied to 15-17% of Ukraine’s exports to the EU, and total export losses in 2026-2030 may exceed $4.6 billion (over 5 years).