When ICAO’s members adopted CORSIA90 in 2016, countries committed to carbon-neutral growth in aviation, measured against an interim baseline for the period 2024-2035 that was set at 85% of 2019’s emissions. Any emissions over this threshold would have to be offset through low-carbon fuels (including SAF), carbon offsets and carbon credits – as long as these comply with frameworks and environmental criteria set by ICAO to ensure integrity. In 2025, the ICAO Council conducted its periodic review of CORSIA, assessing its pilot phase (2021- 2023) and analysing how carbon emissions could evolve towards 2035, alongside the associated requirements and costs for carbon offsetting. The latest analysis suggests that clean fuels may cover 6-10% of CORSIA’s offsetting requirements during its first phase (2024-2026),91 with carbon credits expected to cover the remainder of the obligation. To clear CORSIA’s bar during the first phase, some market commentaries have highlighted a likely shortage of carbon credits and increasing prices due to high demand from airlines. The cost of credits could exceed $60/tonne of carbon abated after 2030 as a result of limited supply,92 up from $21/ tonne in December 2025. Nevertheless, these prices still compare favourably to SAF – the alternative measure for complying with CORSIA – whose carbon abatement cost can be significantly higher. As of January 2026, three programmes have issued eligible credits, including Guyana’s REDD+ programme, now at its third auction,93 and clean cooking programmes in Kenya and Malawi approved in early 2026.94,95 Experts expect this number to grow in 2026, but expansion of supply is contingent on more vocal demand from airlines to demonstrate the sector’s needs and attract investment and projects, as well as faster government authorization for projects to be eligible under CORSIA. As CORSIA scales up, ICAO is confident that implementation of the scheme is on track, especially when it comes to the development of a robust monitoring, reporting and verification system. Some of the stakeholders interviewed for this report were equally positive about the scheme. A notable highlight was ICAO’s 42nd Assembly in September 2025, when countries reiterated support for the scheme as the only global market- based mechanism for international aviation, with no objections, demonstrating stronger multilateralism on clean aviation matters compared to other sectors and themes.96 This factor has contributed to Figure 2’s scoring of “Challenges to multilateralism” as “stable”. CORSIA participation continues to expand, reaching 130 states with the addition of Dominica and Viet Nam from January 2026.97 This is providing confidence in the market in advance of the scheme becoming compulsory in 2027.3.4 Implementation of CORSIA Aviation and aerospace were not insulated from the global trade disputes that regularly hit the headlines in 2025. Throughout the year, a wide range of tariffs were introduced, amended or revoked, creating uncertainty for manufacturers, airlines and airports alike. Additional tariffs on aircraft, components and key materials such as aluminium and steel have been reported to affect manufacturing costs, exacerbating existing supply chain disruptions and most likely resulting in higher costs for airlines. These factors will ultimately dampen industry’s appetite for additional sustainability charges on top of higher aircraft procurement costs. In addition, supply chain disruptions have caused uncertainty and risked delaying new orders from airlines and ongoing fleet renewal, forcing carriers to fly older, more polluting aircraft for longer.3.5 Trade tensions, tariffs and export controls affect aviation supply chains Global Aviation Sustainability Outlook 2026 28