17 January 2025 – Small and medium-sized enterprises in the EU in particular are disadvantaged by the EU market protection measure CBAM. Even though politicians are increasingly calling for changes to CBAM, SMEs in particular need fair and practical solutions for imports. Asian markets lifted by strong Chinese economic data and copper prices rise.
Asian markets lifted by strong Chinese economic data
Asian stocks rallied on Friday, driven by robust Chinese economic performance. China’s Shanghai Shenzhen CSI 300 and Shanghai Composite indices climbed 0.5% and 0.4%, respectively, as GDP growth hit 5% in 2024, aligning with Beijing’s target. December industrial production and retail sales outpaced expectations, highlighting the impact of recent stimulus measures. Hong Kong’s Hang Seng edged up 0.2%.
Momentum extended to regional markets: the Philippines’ PSEi Composite rose 0.5%, and Indonesia’s Jakarta Composite advanced 0.6%, reflecting optimism from the world’s second-largest economy. Positive data reinforced confidence in Asia’s growth outlook.
Copper rises on robust Chinese economic data
Copper prices extended gains on Friday, buoyed by strong Chinese economic performance. Benchmark London Metal Exchange (LME) futures edged up 0.2% a ton, while March futures climbed 0.6%.
China’s GDP growth reached 5.4% in the fourth quarter, lifting annual growth to 5%, meeting Beijing’s target. Aggressive stimulus measures fueled industrial strength, with copper imports hitting a 13-month high in December.
Optimism about sustained Chinese demand has supported copper prices for two weeks, as the world’s largest consumer of the metal signals readiness for further economic support.
CBAM: Simplify imports for SMEs!
The EU Carbon Border Tax CBAM continues to be a hotly debated topic in Europe. Politicians are increasingly calling the Carbon Border Adjustment Mechanism (CBAM), which was actually sold as an environmental protection measure, what it has always been: a market protection measure.
Now, according to media reports, the new EU Climate Commissioner Wopke Hoekstra has told members of the EU Parliament that the European CO2 tariff on imported goods should be simpler and support European exporters.
CBAM for SMEs must immediately simplified
We naturally very much welcome the fact that EU Climate Commissioner Wopke Hoekstra has joined our position and call for a simplification of CBAM. However, we continue to urge that this does not lead to a renewed unfair gap between the large corporations favoured by the EU and the neglected and often forgotten small and medium-sized enterprises (SMEs) in Europe.
Stop subsidising the main CO2 emitters in the EU
European steel makers, the main producers of CO2 emissions, have received more than 56 billion euros in CO2 subsidies from the EU Emissions Trading Scheme since 2005, but have still not managed to sustainably reduce their emissions. Continuing to give these large corporations benefits and subsidies to the detriment of SMEs and at the expense of their competitiveness will continue to lead to an unfair gap in the alleged level playing field and weaken Europe’s economic diversity and innovative strength.
EU steel makers circumvent market protection measures
While SMEs are repeatedly cut off from non-EU sources of supply by market protection measures initiated by EU steel makers, the manufacturers themselves continue to import millions of tonnes of iron ore, sponge iron, alloying agents and steel and stainless steel slabs into Europe. Whilst raw materials such as cold-rolled and hot-rolled steels in particular are repeatedly subject to punitive tariffs, comparable measures are sought in vain, especially for their primary products. This is an excellent example of the EU’s supposedly fair level playing field.
DIHK proposes dangerous CBAM preferential treatment
The German Chamber of Industry and Commerce (DIHK) is also blowing a dangerous horn here. Even though the DIHK is pushing for a practicable regulation of CBAM for SMEs, among others, there must be no exemptions or preferential treatment for a few large corporations. This would ultimately only mean that the legislators in Brussels and the member states would not be forced to find appropriate and practicable CBAM regulations for all company sizes in a timely manner. Level playing field either for all companies at the same time or the activation of CBAM from the beginning of 2026 must be postponed.
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