After more than a decade of academic and policy debate about carbon border adjustments (CBAs) and their policy implications, the full implementation of the world’s first comprehensive CBA is now imminent in 2026 in the European Union (EU). Simultaneously, several other jurisdictions across the Global North are at various stages of implementing their own CBAs. With CBAs transitioning toward real implementation, it is vital to understand their implications for potentially vulnerable trading partners. To this end, we review the current literature on the economic and geopolitical impacts of the EU CBA mechanism (CBAM) on the Global South. Through taking stock of peer reviewed and grey literature, we conclude that the EU CBAM will lead to trade disruptions in the Global South, with some Global South countries particularly vulnerable to potential welfare losses as a result of these disruptions. The likely decrease in trade between the EU and parts of the Global South, and the associated economic impact, may in turn have wider implications for the international climate and trade regimes. Although the EU CBAM regulation does not exempt the world’s poorest states, the current upheaval in global trade presents an opportunity for EU policymakers and others considering CBAs to revisit exemption policies or explore alternatives for vulnerable trading partners. We conclude with outlining gaps in the current literature and propose directions for future study.

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