2026东南亚碳市场洞察报告-碳定价与碳边境调节机制影响（英文版）

/AboutThis/AboutThisIssueThiseditionanalyzeshowinternationalcarbonpricingandthelaunchofthAdjustmentMechanismaffectSoutheastAsianexports.ItprovidesadeepdivmarketframeworkandexaminesthegrowinguseofArticle6tofacilitateinternationalcarbontradingacrosstheregion.MarketPhilipGass,FrancesseJoyJ.Cordon-Navarro,MaryGraceGabis-Reyes,MaiDuong,AntoineBonnet,SimonDünnenberger,JoannaLynMunda,GelenEmilTurano,LoanNguyen2/InternationalandRegional8/BorderCarbonAdjustments(BCAs)andArticle6UpdateBrief15/IndonesiaUpdateBrief19/ThePhilippinesUpdateBrief22/VietNamUpdateBrief/CarbonMarketInsightsisasemi-annualbriefthatdeliverspractical,data-drivenanalysisoncarbonmarketsinSoutheastthePhilippines,andVietNam.Itcombinesreal-worldmarketpricingwithexpertanalysistoprovideactionableguidanceandtheimpactsofglobalbordercarbonadjustments.ARTICLEARTICLE1.InternationalandRegionalBoxBox1.Summaryofinternationalandregionalcarbonpricingupdates•Carbonpricinghasbecomemainstreamglobally,with43carbontaxesand38emissionstradingsystems(ETSs)inforcecoveringover23%ofglobalemissions;marketsareexpandinginscopeandgeneratingsignificantrevenues,thoughpricesignalsremainunevenandvolatilitypersistsacrossmajorsystems.•Canadanowsolelyreliesonindustrialcarbonpricingfollowingthewithdrawaloftheconsumerfuelcharge.ThefederalOutput-BasedPricingSystem(OBPS)appliestolargeemitters,settingemissions-intensitybenchmarksandallowingfacilitiestotradesurpluscreditsorpayafixedchargeonexcessemissions.Severalprovincesoperatetheirownsystemsinplaceofthefederalbackstop.•Asiancarbonmarketsareexpandingbutfaceoversupplyandlowprices:ETSsinChinaandSouthKoreaareundergoingreformstotightenallowanceallocationandstabilizemarketprices,whileJapan’sGXETSintroducespricecorridorsandatransitionplantoamandatoryphase.InternationalDevelopmentsinCarbonPricingCarbonpricinghasbecomeamainstreamclimatepolicytool.Bytheendof2025,43jurisdictionshadimplementedacarbontax(WorldBank,2025),and38ETSswereinoperationglobally.Together,theseETSscoverapproximately12gigatonnes(Gt)ofCO2e,representingmorethan23%ofglobalgreenhousegas(GHG)emissions.Anadditional11ETSsarecurrentlyunderdevelopment,withninemoreunderconsideration.Acrossallcarbonpricinginstruments(ETS,carbontax,orfuelexcisetax),atotalof79countriesnowapplysomeformofcarbonpricing,collectivelycoveringaround82%ofglobalGHGemissions(Mior,2025).Carbonmarketsaregeneratingsignificantfiscalflows.In2024alone,ETSsraisedapproximatelyUSD70billion,bringingtotalrevenuessince2007tonearlyUSD373billion.CarbonMarketInsightsIssue1Theserevenuescanbeusedtosupportclimatemitigation,energytransitionmeasures,andsocialcompensationmechanisms(InternationalCarbonActionPartnership[ICAP],2025b).Nevertheless,acrossthosemechanisms,thepricesignalremainsuneven.In2023,only16%ofemissionsfacedmorethanEUR30/tCO2e,and11%exceededEUR60/tCO2,up13%and7%,respectively(Mior,2025;OrganisationforEconomicCo-operationandDevelopment[OECD],2025).Intermsofeconomicandpopulationcoverage,jurisdictionsoperatingETSsaccountfor58%ofglobalGDP,andalmostonethirdoftheworld’spopulationiscoveredbyanETS(ICAP,2025a).Carbonpricingcontinuestoexpandinscopeanddesign.ETScoverageisdeepeningacrosselectricityandindustrywhileextendingintoshipping,buildings,transport,andagriculture.Anincreasingnumberofsystemsnowoperateonintensity-basedmodelsratherthanusingthecap-and-tradeapproach(Mior,2025).Table1presentstheQ42025pricerangesforcarbonallowancesacrossmajorETSs.Thesubsequentsectionprovidesamoredetailedexplanationofrecentpricedevelopmentsandthekeydriversshapingthesemarkets.Table1.PricecomparisonofcarbonallowancesinQ4of2025CarbonallowancesPriceconvertedtoEuropeanUnionAllowance(EUA)EUR74.5–88.5/tUSD87.2–103.6/tUnitedKingdomAllowance(UKA)GPD54.0–67.9/tUSD72.4–91.0/tCaliforniaCarbonAllowances(CCA)1USD29.3–33.9/tUSD29.3–33.9/tRegionalGreenhouseGasInitiativeAllowance(RGA)USD21.9–29.1/tUSD21.9–29.1/tChinaEmissionAllowance(CEA)CNY51.2–74.6/tUSD7.4–10.7/tKoreanAllowanceUnit(KAU)KRW10,300.0–11,000.0/tSources:CarbonPulsereportingbasedonETSexchangedata(Q42025);currencyconversionbyauthors.EUApricesrosefromaroundEUR76/tinearlyOctobertoEUR88.54/tby23December(USD87.2–103.6/t).AftertradinginanarrowEUR76–80/trangeinOctober,pricesbrokeaboveEUR81/tinearlyNovemberalongsidehighervolumes,signallingstrongerbuyinginterest.TradingactivityintensifiedfurtherinlateNovemberandearlyDecember,withseveralsessionsabove45megatonnes(Mt).DespitethinnerliquidityduringtheChristmasperiod,pricesremainelevatedaboveEUR88/t,suggestingthatthemarketclosedtheyearwithstrongbullishmomentum.TheQ4upswinginEUApriceswasprimarilydrivenby1CarbonallowancesundertheWesternClimateInitiative(WCI).CarbonMarketInsightsIssue1expectationsofupcomingtighterEUclimatetargetsfor2040(EuropeanCommission,2025a)whichwouldimplyamorerestrictivecapandgreaterlong-termscarcityofallowances.UKApricesincreasedfromaboutGBP56/tinearlyOctobertoaroundGBP67–68/tbylateDecember(GBP72.4–91/t).ThroughoutOctober,pricesmovedwithinanarrowrangeofGBP54–57/t,providinglittlehintofmarketdirection.InNovember,pricesroseslightlytowardGBP58/t,buttradingvolumesweremoderate.InearlyDecember,thepricegapbetweenUKAsandEUAswidenedtonearlyGBP20/t,withUKAstradingatanapproximate15%discountonaverageduringQ4comparedtoEUAs.Frommid-Decemberonward,pricesrosesharplytonearlyGBP68/t,andthegapwithEUAsnarrowedtoaroundGBP11–13/t.UKApricesreachedtheirannualpeakattheendofDecember,mainlydrivenbyrecentpolicysignalsregardingtheforthcomingEU–UKETSlinkage.Meanwhile,tradingvolumesremainedlowduetoyear-endholidayimpacts.WCITheWCImarketsawthepricesofCaliforniaCarbonAllowancesstartOctobernearUSD31.37/t,peakingatUSD32.72/tmid-monthbeforeasteadydeclinetoUSD29.28/tbyearlyDecember.Later,Q4followedadownwardpricetrendduetothepassingofthe2025interimcompliancedeadline(1November),whichrepresentsa12%reductionintheallowancesurplus.Dailytradingvolumeswerehighlyvariable,oftenhoveringbetween5,000and12,000units,thoughtheyspikedsignificantlytoover38,000unitsonDecember1asthemarketreactedtoend-of-yearpositioning.Approximately202MtCO2ewereretiredtomeetinterimsurrenderobligations.Thesewereprimarilyacquiredthroughgovernment-runquarterlyauctions,suchastheNovember2025event,orviasecondarymarkettrading(Rafael,2025).RegionalGreenhouseGasInitRGApricessurgedtohistorichighs,reachingarecordUSD29.35pershortton(st)onDecember1,surpassingWCIpricesforthefirsttimeinhistory.Colder-than-averagewintertemperaturesinNortheastAmericaspikedelectricitydemand,servingasabullishfactorinRGAprices.Additionally,politicaldevelopments,specificallyDemocraticgubernatorialwinsinNewJerseyandVirginia,bolsteredmarketconfidenceintheprogram.Tradingvolumesremainedrobust,highlightedbyoutcomesoftheDecember3auction,whichsoldover15.2millionallowancesataclearingpriceofUSD26.73/st,asignificantincreasefromthepreviousquarter.TheseauctionresultsconfirmthatdemandforRGAsisoutpacingsupplyundertheprogram’stighteningemissionscaps.From2019to2025,Canadaappliedadualcarbonpricingapproachatthenationallevel,combiningaconsumerfuelchargewithindustrialcarbonpricingforlargeemitters.Thegovernmentwithdrewtheconsumerfuelchargeearlierin2025.Thedecisiontoremovetheconsumer-facingcarbonpricingresultedinpartfrompublicopposition,whichhasbeenCarbonMarketInsightsIssue1tiedtotheissueofclearlycommunicatingthebenefitsofthepolicy(Cosbey,2025;Logg-Scarvell,2025).ThisisakeylessonfromCanada’sexperience.Switzerlandoffersausefulcontrast:itsgovernmentpubliclyitemizeshowcarbonrevenuesarerecycled—throughvisiblerebatesonenergybillsandtargetedsupportforclean-energyinvestments—helpingcitizensseeadirectreturnonwhattheypayandmaintainstrongpublicacceptanceofthepolicy(Cosbey,2025).IndustrialCarbonPricinginCanadaWiththeeliminationofthefuelcharge,industrialcarbonpricingisnowCanada’ssoleformofcarbonprice.Itappliestoindustrialfacilitiesinselectsectorswithemissionsoverathresholdvolume.UndermostofCanada’sindustrialcarbonpricingsystems,thegovernmentsetsemissionintensitybenchmarksforeachsectororfacilitywithinasector.Companiesemittingbelowtheirbenchmarkearnsurpluscreditsthattheycansellorbankforfuturecompliance,whilethoseexceedingtheirbenchmarkmustpurchasecredits,submiteligibleoffsets,orpayanexcessemissionscharge(Cosbey,2025).Hence,theOutput-BasedPricingSystem(OBPS)combineselementsofbothacarbontaxandanETSbyallowingfacilitieseithertotradecreditsorpayafixedpriceforallowanceslinkedtotheiramountofemissions.Afixedpricepertonneofemissionsismultipliedbythenumberofemissionsexceedingtheallowedlevel.Inthisway,the“headlineprice”actsasapriceceilingbecauseentitieswouldadopttradingifitcouldbedoneatalevelbelowthisfixedcharge.ThefederalOBPSactsasabackstopinjurisdictionswithoutanequivalentsystemofindustrialcarbonpricing—currently,4ofCanada’s13provincesandterritoriesusetheOBPS(Wangetal.,2026).Fourprovinces(Alberta,BritishColumbia,Quebec,andOntario)havechosentoimplementpricingattheprovinciallevelratherthanadheringtothenationalsystem.Thismodelallowsthenationalgovernmenttopursueconsistencyinambitionwhilegivingprovincesandterritoriesflexibilityindesignandadministration;thisisrequiredinCanadaduetothedivisionoflegalauthoritybetweendifferentlevelsofgovernment.Afederalequivalencyreview,scheduledfor2026,willreassesswhetherprovincialprogramsremainalignedwithfederalbenchmarksandmayintroducetighternationalstandardsandreportingrequirements(Wangetal.,2026).ThreeofthefourprovincialsystemsinAlberta,BritishColumbia,andOntariouseanintensity-basedemissionscapsimilartothefederalOBPS.Incontrast,Quebecstandsoutastheonlycap-and-tradesysteminCanada(directlylinkedtoCalifornia’smuchlargermarketviatheWCI)thatimposesaneconomy-wideemissionscapthroughmarketlinkageandauctions.AlbertaandBritishColumbiaallowvariouscomplianceoptions—tradingcredits,purchasingoffsets,orpayingadirectchargetothecompliancebody—althoughtheiroffsetthresholdsdiffersignificantly.Ontario,bycontrast,bansoffsetsentirelyunderitsEmissionsPerformanceStandardsprogram.Facilitiescanbankunusedcreditsforseveralyears,butarenotallowedtoborrowfromfutureperiods.Whilethisflexibilityreducescompliancecosts,itcanalsodampencreditdemandwhencombinedwithlenientbenchmarks—contributingtoanoversupplyandweakeningthecarbonpricesignal,asobservedinAlbertaandBritishColumbia(Wangetal.,2026).CarbonMarketInsightsIssue1Intermsofprices,CanadahadahighheadlinecarbonpriceofCAD95/t(USD70.19/t)in2025,whichisscheduledtoincreasetoCAD170/t(USD125.61/t)by2030.AlbertacarbonpricingfrozeitsheadlinepriceatCAD95/tinJune2025.InNovember2025,AlbertaandthefederalgovernmentagreedtoraisetheeffectivepricetoCAD130/t,thoughdetailsandtimingremainunclear.CarbonpricingsystemsinBritishColumbiaandOntarioremainalignedwiththefederaltrajectory,withcompliancepricesatCAD95/tin2025andscheduledincreasesthereafter.QuebecCap-and-Tradehasa2025minimumauctionreservepriceofCAD24.73/t(USD18.27/t),whiletheNovember2025averagesettlementpricewasCAD39.64/t(USD29.29/t),downfromaFebruary2024peakofCAD56.61/t(USD41.83/t)(Wangetal.,2026).StrongPointsandAreasforImprovementSeveralfeaturesofCanada’scarbonpricingsystemhaveworkedwell.Clearinstitutionalroleshaveimprovedcoordinationandaccountability,withenvironmentministrieshandlingmeasurement,reporting,andverification(MRV)andcompliance,andfinanceministriesmanagingrevenuesandthetransitionfund.Atthesametime,Canada’sexperiencehighlightsareasforrefinement.GenerousemissionsbenchmarksunderthefederalOBPS—andinseveralprovincialsystemsthatmirrorit—havereducedcompliancestrictness,allowingmanyfacilitiestomeettargetswithoutsignificantadditionalabatement.Thishasreducedpricesandsloweddecarbonizationprogress.TighteningbenchmarkstringencycouldreinforcetheenvironmentalintegrityofCanada’sframeworkwhilepreservingtheflexibilitythathassupporteditsdurability.CarbonpricinghasevolvedtovaryingstagesofdevelopmentacrossAsia.Implementedin2015,SouthKorea’sETSwasthefirstnationalcompliancecarbonmarketintheregion,followingacap-and-tradeprinciplewithabsoluteemissioncapstightenedannually.Incomparison,China’snationalETS—theworld’slargestETSintermsofemissioncoverage—beganoperatinginJuly2021.Theintensity-basedapproachofChina’sETS,whichcapsemissionsperunitofproduction,servesasaflagshipmodelforcarbonmarketsindevelopingcountrieswithrisingemissions,suchasVietNamandIndonesia,andfutureETSsinIndiaandthePhilippines.InbothSouthKorea’sandChina’sETSs,anoversupplyofallowanceshaskeptpriceslowandlimitedtradingactivitylargelytocompliancepurposes(CarbonMarket,n.d.).DuetothecompletionofcomplianceattheendofAugust,tradingactivityovertheKoreaExchange—thetradingplatformofSouthKorea’sETS—declinedbyover50%comparedtoQ2,withatotalof6.5millionKAUstransacted.Followingtheintroductionofanewvintage(KAU25),allowancepricesincreasedslightly,albeitremainingatalowlevel(KRW10,300/t,orUSD7/t)(Carbon-i,2026).Incomparison,throughout2025,CEAsaveragedaboveCNY73/t(USD10.5/t),representinga20%year-on-yeardecline.Drivenbytheyear-endcompliancedeadline,atotalof136.5millionCEAsweretransactedontheShanghaiEnvironmentandEnergyExchangeduringQ4,contributing58%tothetotalannualtradingvolume.CarbonMarketInsightsIssue1Bothsystemsaretakingstepstoaddressthisissueofallowancessurplus.Inmid-November,SouthKoreareleaseditslong-awaitedfourthallocationplan(2026–2030),whichintroducesaroadmapforreducingfreeallocationforincludedsectorstoward2030.Totackleoversupplyandpreventsignificantpricevolatility,theSouthKoreangovernmentdecidedtoincreasethebankinglimitsandintroduceamarketreservetomanagethevolumeofavailableallowances—amechanismsimilartotheEUETSMarketStabilityReserve.AlsoinNovember,Chinareleasedadetailedallocationplanfornewlyincludedindustrialsectors,clarifyingmethodologiestopreventoversupplyinthesesectors(MinistryofEcologyandEnvironment,2025).Underthisframework,allowancesforsteel,cement,andaluminumsmeltingentitieswillbedeterminedbasedonverifiedemissionsandeachentity’scarbonemissionintensitycoefficient—anindicatorofhowitsemissionintensitycomparestotheindustrybenchmark.InJapan,anationalemissionstradingsystem—theGreenTransformationETS(GX-ETS)—waslaunchedin2023andhasabase-and-creditdesign.TradingontheJapanExchange(JPX)hassofarbeenlimited,withcreditpricesvaryingwidelyacrossdifferenttypesofcredits.ThroughoutQ4,above38,000creditschangedhands,upto80%ofwhichwereJ-Creditsfromenergysavingandrenewableenergy(power)projects.Bytheendof2025,around1millioncreditshadbeentradedontheJPX,withpricesvaryingfromJPY1,500/ttoJPY9,900/t(USD9.5–63/t)(JPX,2025).Japan’sGX-ETSwillremainvoluntaryuntilMarch2026,whenitissettotransitiontoamandatorycap-and-tradescheme(ICAP,2025c).OnDecember19,theJapanesegovernmentannouncedtheintroductionofupperandlowerpricelimitsforitsETS’smandatoryphase.For2026,theupperandlowerlimitsweresetatJPY4,300/t(USD27.2/t)andJPY1,700/t(USD10.7/t),respectively(Pandey,2025c).Thesepricelimitsareexpectedtosupportmarketcompetitivenessandreducetheriskofsignificantpricevolatilitycausedbyeconomicshocks.JapaniscontinuingtodevelopfurthermarketrulesanddesignelementsforitsGX-ETS,includingcapandbenchmarksettings.Currently,onlycreditsfromthedomesticJ-CreditprogramandbilateralJointCreditingMechanismarerecognizedaseligibleforcompliancewithJapan’sGX-ETS.Intermsofcarbontaxes,Japanhasappliedonesince2012atalowrate(JPY289/t,orUSD1.8/t)andplanstostrengthenitbeginningin2028.SingaporeistheonlycountryinSoutheastAsiawithafullyimplementedcarbontax(MinistryofSustainabilityandtheEnvironment,2024).Theregionalcarbonpricingdebatecentresonbalancingclimateambitionwitheconomicgrowth,whilemanagingthepoliticalsensitivityofrisingelectricityandfuelcostsandconcernsaboutcompetitiveness.Atthesametime,publicdemandforclimateprotectionisincreasing,particularlyinSoutheastAsia,whereclimaterisksarealreadyvisible.Inthiscontext,governmentsincreasinglypresentcarbonpricingasbotha“polluter-pays”instrumentandarevenuesource(Febiolaetal.,2023;Zafarullah&Mehnaz,2025)andemphasizerevenuerecyclingtoshieldvulnerablehouseholdsandsectors,aswellasreinvestmentingreendevelopment,adaptation,andneweconomicopportunities.ARTICLEARTICLE2.BorderCarbonAdjustmentandArticle6UpdateBriefBorderCarbonAdjustmentUpdateBriefBoxBox2.SummaryofBCAupdates•TheEUCarbonBorderAdjustmentMechanism(EUCBAM)entereditsdefinitivephaseinJanuary2026.•Economy-wideexposuretobordercarbonadjustmentsforIndonesia,VietNam,andPhilippinesremainslow,butsectoralexposureissignificantinironandsteel,aluminum,andcement.•HighdefaultemissionsintensityvaluesimplypotentiallysignificantEUCBAMliabilitiesunlessmitigatedthroughdomesticdecarbonizationaccompaniedbyemissionsmeasurementandverification.•ClosemonitoringofglobalBCApolicydevelopmentswillbeimportant.PlannedextensionsofEUCBAMtodownstream,metal-intensiveproductscouldmateriallyincreaseexposureformanufacturedexportsfromSoutheastAsia.BCAsarenowareality,withtheEUCBAMenteringitsdefinitivephaseinJanuary2026.ItaimstoapplythesamecarboncosttoimportedproductsasthatfacedbyEUproducersofthesamegood.Themotivationistoaddress“carbonleakage,”whereemissionsreductionsinonejurisdictionareoffsetbyincreaseselsewhere.TheEUCBAMcoversemissions-intensiveandtrade-exposedupstreamgoodsinsectorsincludingsteel,aluminum,cement,fertilizers,hydrogen,andelectricity(EuropeanCommission,2026).Othergovernmentsareplanning,oratleastconsidering,similarmeasures.TheUnitedKingdomissettoimplementitsCBAMin2027.Australia’sgovernmentcommissioneda“CarbonLeakageReview”thatdescribedapossibleBCAfavourably.ChineseTaipei,Canada,andTürkiyehavealsoshowninterestinsuchmechanisms.CarbonMarketInsightsIssue1ForIndonesia,VietNam,andthePhilippines,thedirecteconomicimpactmaylookmodestonpaper.Lessthan1%oftotalexportsfromeachcountryfallsunderthescopeoftheEUCBAM.ExposuretotheUKCBAMorahypotheticalAustralianBCAareevensmaller(Figure1).Figure1.BCA-coveredgoods,asapercentageofnationalexports,20220.8ShareShareofnationalexports(%)EUCBAMUKCBAMHypotheticalAustralianBCAIIndonesiaPPhilippinesVVietNamSource:IISD’scalculationsbasedonBACItradedata(Centred’ÉtudesProspectivesetd’InformationsInternationales,2024,DepartmentofClimateChange,Energy,theEnvironmentandWater,2024;EU,2023;HMRevenue&Customs,2025).Whenlookingatsingleindustries,however,theexposuremaybesignificant.InVietNam,forexample,morethanonefifthofironandsteelexportswenttotheEUin2022(Figure2).ForIndonesia,EU-destinedproductaccountedforalmost20%ofaluminumexportsinthesameyear.2TheUnitedKingdom’smechanism,startingayearlater,posesasmallerpotentialimpactfortheregionoverall.ApotentialAustralianBCAcouldbesignificantforIndonesiaatthesectorallevel,particularlyforcement.Domesticpolicymakesadifference.Carbonpricingsystemsareintendedtoencourageemissionsreductions,whichwillreduceliabilitiesunderBCAsinforeignmarkets.Furthermore,theEUCBAMisdesignedtoavoid“doublecarbonpricing,”soanyexplicitcarbonpricealreadypaidathomeistobedeductedfromthebillattheborder.Fromthisperspective,VietNam’splantorolloutadomesticcarbonmarketunderapilotphasefrom2025andIndonesia’splantoextenditsETStosteelandcementcanmeaningfullylowerBCAliabilitiesinthemediumrun.2AllfiguresrelatingtoexposuretoBCAsareIISD’scalculationsbasedonBACItradedata(Centred’ÉtudesProspectivesetd’InformationsInternationales,2024,DepartmentofClimateChange,Energy,theEnvironmentandWater,2024;EU,2023;HMRevenue&Customs,2025).CarbonMarketInsightsIssue1Figure2.BCA-coveredgoods,asashareofsectoralexportsineachcountry,2022ShareShareofsectoralexports(%)201050SectoralSectoralexports(%)1050HypotheticalAustralianBCASectoralHypotheticalAustralianBCASectoralexports(%)1050AluminumFertilizersIIndonesiaPPhilippinesVVietNamSource:IISD’scalculationsbasedonBACItradedata(Centred’ÉtudesProspectivesetd’InformationsInternationales,2024,DepartmentofClimateChange,Energy,theEnvironmentandWater,2024;EU,2023;HMRevenue&Customs,2025).Finally,exporterswhoareabletomeasure,report,andverifytheirproductionemissionsaccordingtoEUrequirementswillhaveacompetitiveadvantageoverthosewhodonot.IfactualemissionsarenotmeasuredandreportedunderCBAM,theimporterswillhavetoapplydefaultemissionsintensityvaluesthathavebeendefinedbytheEuropeanCommissionCarbonMarketInsightsIssue1foralistofproductsandcountries.Thesedefaultvaluesarehigh:by2028,defaultvalueswillcarrya30%“mark-up”orpenaltyovertheaverageemissionsintensity.UnderthereformproposedbytheEuropeanCommissiononDecember17,2025,theEUCBAMwouldbeextendedtoaround180downstreamproducts,notablysteel-andaluminum-intensivemanufacturedgoodssuchasmachinery,equipment,andselectedtransport-relatedcomponents.Whilethisproposalhasnotbeenadopted,someextensionofEUCBAMislikely(EuropeanCommission.2025b).IISDpreliminarycalculationssuggestthatsuchanextensionwouldincreaseexportexposure(expressedasashareofexportsthatmaybecovered)by0.17percentagepointsforVietNam,0.05percentagepointsforIndonesia,and0.12percentagepointsforthePhilippines,indicatingthatdownstreamcoveragecouldmeaningfullyincreasetheregion’sexposuretoCBAM.3Article6UpdateBriefBoxBox3.SummaryofArticle6updates•RecentdevelopmentsshowthatArticle6.2hasadvancedfurtherinimplementationthanArticle6.4,withover100bilateralagreementsandactivepurchasingcountriesexpandingcross-bordertransactions.•TechnicalworkunderArticle6.2isprogressing,withnewstandardizedmethodssupportingbroadersectoralcoverage.•WhileArticle6.4hasbeguntransitioningCleanDevelopmentMechanism(CDM)projectsandadopteditsfirstmethodology,itsimplementationremainsinanearlyphase,withmarketuncertainty,slowmethodologicaldevelopment,andconcernsontheintegrityofthetransitioningactivities.Article6oftheParisAgreementestablishesbothmarket-basedmechanismsandnon-marketapproachestosupportcountriesinmeetingtheirnationallydeterminedcontribution(NDC)targets.Market-basedmechanismsseektounlockclimatefinancethroughinternationalcarbonmarketsunderArticles6.2and6.4,whilenon-marketapproachesarticulatedinArticle6.8includefinancialsupport,technologydevelopmentandtransfer,andcapacitybuilding(UnitedNationsFrameworkConventiononClimateChange[UNFCCC],2026).Article6.2UpdateBriefArticle6.2oftheParisAgreementprovidesaframeworkforvoluntarycooperationamongcountriesthroughthebilateralorplurilateraltransferofcarboncredits,knownasinternationallytransferredmitigationoutcomes(ITMOs).ThesetransfersallowcountriestoworktowardtheirNDCtargetsusingcarboncreditsfromothercountries.Partiesarerequired3IISDpreliminarycalculationsbasedon2023tradedata(Eurostat,2025).Note:theseproductswouldfallundertheEUCBAMonlyiftheycontainaluminumorsteel.Becausetradestatisticsdonotallowidentificationofthematerialcontentoftheseproducts,thefiguresaboveshouldbeinterpretedasupper-boundestimates.CarbonMarketInsightsIssue1toimplementcorrespondingadjustments—accountingadjustmentstotheiremissionsbalancesupontheinitialtransferandsubsequentutilizationofITMOs.ThisensuresthatasinglemitigationoutcomeisnotattributedtomultipleNDCs,therebypreservingtheenvironmentalintegrityofcooperativeapproachesunderArticle6.2(UNFCCC,Decision2/CMA3,2021)(UNFCCC,2022).In2025,theimplementationofArticle6.2hasgraduallyprogressed.DatafromtheUnitedNationsEnvironmentProgramme(UNEP)CopenhagenClimateCentre(CCC)(2025)indicatethatmorethan100bilateralagreements,memorandaofunderstanding,orsimilararrangementshavebeenannouncedorformalized.Japan,Singapore,Switzerland,andSouthKoreahaveemergedastheprimarypurchasingcountries,sourcingITMOspredominantlyfromotherAsiancou