Canada facing carbon tariff threat from European Union: internal documents

Source: CBC Politics
Date: 2026-10-28 08:00:00.0
Tags: [National, Quebec, Newfoundland and Labrador, Trade, Economy, Environment]

Internal Global Affairs Canada documents reveal that Canadian iron, steel, and aluminum exports face imminent carbon tariffs under the European Union's Carbon Border Adjustment Mechanism (CBAM), as Canada's national carbon price of $95 per tonne is not linked to the EU's $134 per tonne system. The incoming import levy exposes approximately $2.8 billion worth of Canadian goods annually, hitting the provinces of Newfoundland and Labrador and Quebec particularly hard with $885 million and $792 million in exposed exports, respectively. Global Affairs Canada estimates that Canadian exporters will face substantial administrative and compliance costs, with experts warning that EU carbon tariffs could eventually add up to $150 per tonne of steel by 2034. Canadian diplomats continue to engage with the European Commission during the Canada-EU Summit in Montreal to seek exemptions or recognition for domestic industrial carbon pricing systems.