Sanctions and CBAM: Implications for the Russian industry

In 2021, CENEf-XXI released a robust study on the potential implications on the Russian economy of the CBAM mechanism announced by the EU (CENEf-XXI, 2021. CBAM: Impact on the Russian economy. Moscow). The intention for 2022 was to trace the evolution of CBAM regulations and CBAM-like regulations and to assess the impacts of the final CBAM design on the Russian economy. The final CBAM regulation was released by the EU only in mid-December 2022. On February 24, the Russian military operation started and was followed by multiple sanctions which ultimately closed the EU market for some of the Russian CBAM goods, and this had much more severe effects on the Russian industry, than what had been expected from CBAM alone. Until the sanctions are lifted, they will be coupling with the CBAM effects for those CBAM goods, which are still allowed to the EU market.