The Impact of the EU CBAM on Thai Exporting Firms: Analysis of Firm-level Data

Talatchanant Tontiwachwutthikul, Kannika Thampanishvong, Kanis Saengchote, Krislert Samphantharak and Jirayu Chandrasakha

No 243, PIER Discussion Papers from Puey Ungphakorn Institute for Economic Research

Abstract: To mitigate the risk of carbon leakage, the European Union (EU) introduced the Carbon Border Adjustment Mechanism (CBAM) to impose a fair price on the carbon emissions associated with the production of carbon-intensive goods imported into the EU, thereby encouraging cleaner industrial production. This paper combines firm-level exporting activity data and financial data in a difference-in-differences regression framework to examine the impact that the CBAM policy announcement and implementation have on Thai exporting firms. We find that the announcement of the CBAM negatively affected Thai firms' ability to export impacted goods to the EU, and these adverse effects intensified following the CBAM implementation. Treated firms’ total export revenue decreased relative to the control group and were only able to partially mitigate the impact of this shock by increasing exports of non-CBAM goods to countries outside of the EU.

Keywords: Carbon Border Adjustment Mechanism (CBAM); Thailand, exporting firm; International trade (search for similar items in EconPapers)
JEL-codes: F14 F18 Q54 (search for similar items in EconPapers)
Pages: 40 pages
Date: 2025-12
New Economics Papers: this item is included in nep-eec, nep-iaf, nep-sbm and nep-sea
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