EU carbon pricing has not harmed Swedish firms’ competitiveness

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The EU’s Emissions Trading System (EU ETS) has had no detectable negative impact on Swedish firms’ international trade. This is the finding of a new report from the National Board of Trade Sweden. The results suggest that carbon pricing and competitiveness can go hand in hand.

The report examines whether higher carbon prices have affected Swedish firms’ imports and exports and led to carbon leakage, where production and emissions shift abroad. The findings show no consistent evidence of negative effects on trade flows.

“Swedish firms competitiveness appears not to have been affected by the higher carbon prices. This may be due to free emission allowances or firms adapting their production to reduce emissions. As the EU changes the system, continued monitoring will be important,” says Mai Ahrne Bojang, trade policy adviser at the National Board of Trade Sweden.

Read the full interview and download the report
Carbon Leakage and Competitiveness: International Trade Effects of Carbon Pricing