Two huge multilaterial issues – free trade and climate change – top policymakers’ agendas. The authors outline an opportunity for linking these two agendas by levying a a carbon charge on imports. They outline ways to use border carbon adjustments (BCAs) to level the emissions playing field by imposing the same economic burden on domestic and external manufacturers. BCAs would reduce producers’ incentives to manufacture goods in places with less regulation, and boost incentives for trade partners to seek low-carbon products to avoid penalties.

The authors outline how a group of like-minded countries could proceed by setting out key steps needed to balance legal durability, ease of iplementation, and environmental performance.

The authors argue that, rather than prolonging the current spiral of tariff tit-for-tat, countries should rally and turn the incipient trade war into an opportunity to ratchet up climate ambition.