Investigating the carbon border adjustment mechanism transition process with linguistic summarization method: A situational analysis of exporting countries

Abstract

The Paris Agreement holds significant importance since it establishes a global framework for addressing the issue of climate change and endeavors to mitigate the release of greenhouse gases. The Carbon Border Adjustment Mechanism was introduced as an integral component of this agreement, aiming to oversee the carbon emissions associated with imported items within the European Union and provide compensation for the emissions from the nations engaged in importation. It is essential to analyze the countries involved in exporting to the European Union within the Carbon Border Adjustment Mechanism context to mitigate carbon leakage and effectively support the objectives outlined in the Paris Agreement. This research investigated 104 nations engaged in exporting activities to 27 European Union member countries. The linguistic summarization method, a descriptive data analytics tool, was employed for the analysis. A total of 42 Combined Nomenclature codes were encompassed within the scope of evaluation throughout the transition phase of the Carbon Border Adjustment Mechanism. This study examines the characteristics of exporting nations based on three variables: The Environmental Performance Index, a sustainability indicator; the Region in which the countries are located as classified by the World Bank; and the quantity of Renewable Energy Consumption. Additionally, the study explores the characteristics of EU countries, focusing on their Environmental Performance Index score and geography. The study employed fuzzy sets and the fuzzy c-means algorithm as parts of the linguistic summarization technique. Polyadic quantifiers were used to extract linguistic summaries, resulting in the acquisition of 124,227 summaries. A total of 1594 summaries have a truth degree exceeding 0.9. The findings were effectively utilized to assess the influence of the linguistic summarization approach and offered a valuable viewpoint for decision-makers needing more expertise in this domain.