Thai Industry Defies Odds with 54% Surge in ‘Green’ Exports to the EU

 

Iron and aluminium lead the charge as Thai exporters successfully navigate Brussels’ Carbon Border Adjustment Mechanism (CBAM) ahead of 2026 deadline.

 

Thailand’s industrial sector has demonstrated remarkable resilience in the face of tightening European environmental standards, with exports of carbon-intensive goods to the European Union (EU) surging by nearly 55 per cent.

 

Reporting for Thansettakij, Chatchayapron Phongam notes that during the first ten months of 2025, Thai exports falling under the Carbon Border Adjustment Mechanism (CBAM) grew by a staggering 54.71 per cent.

 

This growth has allowed Thailand to capture a 0.42 per cent share of the EU's CBAM market—a significant jump from the 0.29 per cent recorded throughout 2024.

 

 

 

Navigating the ‘Green Deal’

CBAM is a cornerstone of the European Green Deal, designed to level the playing field between EU manufacturers, who pay for their emissions via the EU Emissions Trading System (ETS), and foreign exporters.

 

By placing a carbon price on imports, Brussels aims to prevent "carbon leakage" to countries with less stringent climate policies.

 

Nantapong Chiralerspong, director of the Trade Policy and Strategy Office (TPSO), confirmed that the growth was largely driven by the iron, steel, and aluminium sectors.

 

These industries have proven particularly adept at adjusting to the new reporting requirements ahead of the "Definitive Phase" of the regulations, which is set to commence on 1 January 2026.

 

 

Sectoral Performance

While iron and steel remain the heavyweights of this trade relationship, aluminium exports to the EU were valued at $56.47 million, accounting for over 15 per cent of Thailand’s CBAM-related trade with the bloc.

 

Conversely, sectors such as cement, fertiliser, and hydrogen have yet to make a significant impact on the export ledger.

 

 

 

The Path to 2026

Despite the current success, Nantapong warned that the window for preparation is closing.

 

As the EU prepares to expand its scope to include downstream products, Thai firms—particularly Small and Medium-sized Enterprises (SMEs)—must formalise their carbon accounting.

 

The TPSO has urged the private sector to adopt a "Green Supply Chain" mentality.

 

Key recommendations include:

Enhanced MRV Systems: Implementing robust Monitoring, Reporting, and Verification systems to track Scope 1, 2, and 3 emissions.

Low-Carbon Investment: Upgrading manufacturing plants with renewable energy and energy-efficient technology to lower the "carbon intensity" of products.

Green Procurement: Utilising digital tools and ERP systems to ensure raw materials meet international sustainability standards.

 

 

Legislative Support

To bolster these efforts, the Thai government is fast-tracking the Climate Change Act.

 

This legislative framework is expected to provide a systematic domestic mechanism for managing greenhouse gas emissions, effectively acting as a shield against the financial shocks of international carbon pricing.

 

"The transition to a low-carbon economy is no longer a choice but a competitive necessity," Nantapong added. "While the short-term costs of adaptation are real, the long-term benefit is a permanent seat at the table of global trade."