1. EU seeks to block carbon leakage in power and commodities sectors. 2. CBAM could incentivise third countries to ramp up their climate ambitions. 3. Carbon border taxes could also harm developing countries and spark trade wars. 4. EU considers "benchmarks" to avoid data issues. As the European Union turns the regulatory screw on emitters within its own borders, the problem of "carbon leakage" - the relocation of emissions-heavy industries to regions with looser environmental regulations - becomes increasingly pressing.
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