Read the passage and mark the letter A, B, C or D on your answer sheet to indicate the best answer to each of the following questions from 1...

Read the passage and mark the letter A, B, C or D on your answer sheet to indicate the best answer to each of the following questions from 18 to 25.

        As the EU moves to install a Carbon Border Adjustment Mechanism (CBAM), advocates argue it should cut emissions decisively, curb leakage, and remain compatible with development needs. Macron’s push framed it as an engine for a continent-wide green transition that does not eviscerate competitiveness. Yet supporters concede that design choices will determine whether the instrument is equitable or merely cosmetic. They warn that, unless calibrated to protect poorer nations’ development space, the policy may look principled while operating regressively.

        Under the proposal, emissions embedded in imports would be priced so EU and foreign producers face equivalent carbon costs as free allowances are phased out. Initial coverage – iron and steel, cement, fertilisers, aluminium and electricity – was judged too narrow. To avoid hypothetical leakage and to stimulate cleaner processes, critics urge adding bulk chemicals such as plastics and, crucially, including indirect power-sector emissions. If these externalities were counted, importers would have incentives to decarbonise supply chains instead of relying on ostensibly cheaper, polluting inputs.

        Financing is equally pivotal. Revenues from CBAM certificates, it is argued, should fund climate action outside Europe rather than backfill general EU obligations. Allocating CBAM revenues to the EU budget would undercut its climate rationale and risk a WTO challenge. Export rebates are likewise discouraged: by lowering the carbon price on outbound goods, they could exacerbate “carbon dumping” and dull incentives to abate. A mechanism that prices pollution consistently – regardless of destination – better aligns with the ambition to elevate global climate discipline.

        Fairness must be operationalised, not merely proclaimed. The EU’s historical responsibility and the heightened burden carbon pricing imposes on low-income countries require a tailored approach. The Commission is urged to consult developing partners – especially LDCs and SIDS – and accompany CBAM with technical assistance, finance, and capacity building to help them decarbonise. If legislators craft tangible incentives for cleaner production while recognising the right to develop, the instrument will be more palatable abroad and more effective at driving real-economy emissions reductions.

(Adapted from Carbon Market Watch, 2022: “How to make the EU’s carbon border tax effective and fair?”)

Question 18. Which of the following is NOT mentioned in paragraph 1 as a goal of the CBAM?

A. cutting greenhouse-gas emissions decisively

B. preserving European industrial competitiveness

C. repaying EU pandemic-related debt

D. safeguarding poorer countries’ development space