Chris Hipkins is floating the idea of an effective tariff on imported cement.
He reckons it could be a better way of dealing with our cement problem than $60 million in corporate welfare.
The reason Golden Bay Cement needs a bailout is the cost of buying carbon credits from 2030 onwards. The cost of carbon credits is because of the ETS.
When your builder goes to lay cement, they will buy imported stuff because it'll be cheaper – no carbon costs included.
So how do you get around this? You could change the ETS to exempt cement and steel, as we largely do with agriculture, but then you undermine the system.
You could scrap the ETS, which would mean ditching the Paris Agreement.
Or you could do as the EU does and go with a "Carbon Border Adjustment Mechanism".
Basically, a carbon tariff on importers to level the playing field with local producers.
Chris Hipkins is saying this is an idea Labour would consider.
National won't because they say it'll mess with Free Trade Agreements.
So we're a bit boxed in here.
If we want to be a country of free trade AND a climate warrior, then we seem destined to lose a bunch of local production and industry.
Sure, we'll do better in some areas, but manufacturing and anything involving carbon emissions? Look out.
In the meantime, taxpayer-funded corporate welfare to the rescue.
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