The latest report by the Climate Council indicates that climate inaction by the Australian Government is hurting households and businesses, and spells missed economic opportunities at a rising cost. The trend began when the European Union announced a Carbon Border Adjustment Mechanism (CBAM) in July 2021. The new modelling by economists at Victoria University shows Australia will experience a cut to its gross domestic product (GDP) as a result. 

Further, if South Korea, China and the Group of 7 follow suit, New South Wales will be immensely affected due to the dominance of targeted exports – especially coal. This would lead to a projected loss of around 20,000 jobs and more than $5bn in Gross State Product.

Climate Councillor Nicki Hutley, a former partner at Deloitte Access Economics, 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.”

As a solution, Hutley suggested there are huge opportunities to create more clean jobs and invest in green industries. Modelling by Beyond Zero Emissions estimates Australia could grow a new green export mix worth $333bn per annum, almost triple the value of existing fossil fuel exports. 

Data shows Australia has the natural resources and the ingenuity to become a world leader in renewable energy. Federal government action, however, is "long overdue," said Hutley. "As a first step, we should match our key trading partners and at least halve emissions by 2030," she said.