How ASEAN can benefit from the EU's carbon border adjustment mechanism | CarbonCredit.io

The EU's Carbon Border Adjustment Mechanism (CBAM) is reshaping global trade by requiring importers of steel, aluminium, cement, fertilisers, and hydrogen to pay a carbon price on imports from countries without equivalent carbon pricing. While much of the debate has focused on trade competitiveness and climate goals, a new analysis from the Lowy Institute examines what CBAM means for jobs in ASEAN, a region of over 350 million workers deeply embedded in global supply chains. The impact is not uniform across ASEAN. Countries like Malaysia, Indonesia, and Vietnam are major exporters of CBAM-covered goods to the EU, and firms unable to reduce emissions or comply with reporting requirements could lose market share. However, the transition also creates demand for engineers in renewable energy, carbon accounting specialists, and low-carbon manufacturing experts. ASEAN has abundant renewable resources and a young workforce, positioning it to attract investment from multinationals weighing carbon intensity alongside labour costs. The article argues that ASEAN governments should invest in reskilling workers, expand training in clean energy and carbon accounting, and strengthen regional cooperation on green industrial development. The EU, in turn, should provide technical assistance and technology transfer to help ASEAN industries decarbonise, making CBAM more effective and less like trade protection. The key takeaway: carbon governance is becoming a source of international competitiveness, and ASEAN's workforce readiness will determine whether it captures the green jobs opportunity.