A NEW REPORT released today by the Climate Council finds the lack of federal government climate policy exposes the nation to serious economic consequences - including 20,000 jobs at risk in New South Wales - from carbon border tariffs.
Markets are moving: the economic costs of Australia's climate inaction was authored by Climate Councillor Nicki Hutley, a former partner at Deloitte Access Economics.
Ms Hutley said: "The world is responding to the climate crisis and carbon border tariffs are now inevitable. Australians will pay the price unless the federal government cuts our national carbon emissions in line with our major trading partners - and NSW will be disproportionately affected.
The European Union announced a Carbon Border Adjustment Mechanism (CBAM) in July 2021. Ms Hutley said the new modelling by economists at Victoria University shows Australia will experience a cut to our Gross Domestic Product (GDP) as a result.
If South Korea, China and the Group of 7 follow suit, New South Wales will be heavily impacted due to the dominance of targeted exports - particularly coal. Under the above scenario, the state is projected to lose around 20,000 jobs and more than $5 billion in Gross State Product.
"The federal government should be getting out in front, and putting support for regions affected in place. The new, low-carbon economy is coming and we urgently need a transition plan in place for Australian communities and workers", said Ms Hutley.
REPORT KEY FINDINGS:
- The European Union's CBAM is expected to be the first of many such schemes as countries re-level the economic playing field on climate action. Such moves are being considered by Australia's key trading partners.
- A growing number of countries have a carbon price which requires those responsible for creating emissions to pay for them. As such carbon prices continue to rise, the costs of failing to act will also rise.
- Every day that the Australian Government delays climate action it is hurting households and businesses in missed economic opportunities and rising costs.
Ms Hutley said there are huge opportunities for investment in clean jobs and industries with modelling by Beyond Zero Emissions estimating Australia could grow a new green export mix worth $333 billion per annum, almost triple the value of existing fossil fuel exports. Deloitte Access Economics' modelling suggests support for a low carbon economy would add $680 billion in economic growth and 250,000 new jobs by 2070.
"We have the natural resources and the ingenuity to become a world leader in renewable energy, and in industries such as clean manufacturing, minerals processing and renewable hydrogen - bringing tens of thousands of jobs to the states and regions.
Ms Hutley said, "Federal government action is long overdue. As a first step, we should match our key trading partners and at least halve emissions by 2030. In line with the science, the Climate Council recommends a 75% cut by 2030 on the way to zero by 2035."
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