Egypt

Implementation period: 2025-2026 Funding amount: US$300,000  Window: Just-in-Time

Starting in January 2026, the European Union will require importers of certain carbon-intensive goods to pay for their products embodied carbon emissions under the Carbon Border Adjustment Mechanism (CBAM). This could expose Egypt to substantial carbon cost obligations, as around 6 percent of its 2022 exports fall under CBAM’s scope, with half of these exports destined for the EU market.

The CBAM analysis has generated knowledge and awareness of which sectors stand to gain or be impacted by the EU CBAM, and the government is now in a position to consider adopting proposed mitigation measures, including potentially through continued World Bank support.

Objectives & Activities  

To help reduce exposure to the EU CBAM and strengthen Egypt’s participation in carbon markets, the Partnership for Market Implementation (PMI) is providing Just-in-Time support to the Government of Egypt. The support includes:

• Assessing the potential impact of the EU CBAM on Egypt’s exports
• Identifying options (e.g., carbon pricing) to reduce CBAM exposure
• Developing procedures for authorizing Internationally Transferred Mitigation Outcomes (ITMOs)
• Advising on options for a national carbon asset registry to track mitigation outcomes under Article 6

Additional Resources

• Egypt’s National Climate Change Strategy 2050
• Egypt’s Sustainable Development Strategy (Vision 2030) Egypt’s Second Updated NDC (2023)  
• Egyptian Climate Exchange