Serbia calls on EU to phase in CBAM

Belgrade fears economic shock from sudden increase in carbon duty to €70/t

Serbia has called for the phased introduction of the European Union’s carbon duty – the Cross-Border Carbon Adjustment Mechanism (CBAM) – in order to maintain the competitiveness of the national economy. This was stated by Energy Minister Dubravka Jedovic Handanovic on July 18 on state television channel RTS after participating in a meeting of the Ministerial Council of the Energy Community in Athens.

«The EU has been gradually increasing carbon tax rates for 20 years. We cannot simply go from zero to €70 per ton of emissions in one day,» she stressed.

CBAM aims to reduce global emissions by introducing duties on imports of carbon-intensive goods such as steel, cement, fertilizers, aluminum, hydrogen, and electricity. The full launch of the mechanism is planned for 2026.

The European Commission explains that CBAM prevents “carbon leakage,” i.e., the relocation of production to countries with less stringent environmental policies. According to estimates by the Serbian Chamber of Commerce and Industry, the new regulation will potentially affect about 500 local companies.

In addition, Dubravka Jedovic Handanovic said that Serbia is ready for integration into the EU electricity market. The compliance review process by European institutions is expected to take about 18 months.

Amid upcoming climate requirements, Serbia is seeking to balance environmental goals with economic stability, seeking a compromise in cooperation with the European Union.

As GMK Center reported earlier, the European Commission has opened consultations on the cross-border carbon adjustment mechanism. The purpose of the event is to gather the views of stakeholders on the development of policies for the potential extension of the mechanism’s scope, anti-circumvention measures, and rules for the electricity sector. The consultations are open until August 26 of this year.