A Study On The Estimation And Drivers Of Carbon Dioxide Emissions Embodied In China-EU Trade

Since entering into WTO, the International trade of China developed rapidly, but it causes huge energy consumption and carbon emissions. With the more close economic and trade relations between China and EU, EU has become the largest trade partner of China, and China has become the largest source of imports of EU. However, the carbon emissions of China have more than tripled in the past decade, while the carbon emissions of EU keep stable and even decrease. Therefore, it is very important to study whether the bilateral trade between China and EU would lead to relocation of carbon emissions to China.Based on reviewing the domestic and foreign literatures, using Multi-Regional Input-Output(MRIO) model, this paper measures the amount of carbon dioxide emissions embodied in the bilateral trade between China and EU. It was found that there was a net export of carbon dioxide emissions embodied from China to EU. This is mainly because although both the carbon dioxide in exported goods from China to EU and that from EU to China grew, the growth of latter was smaller than the former.After estimating the volume of carbon dioxide emissions embodied in China-EU trade, we used structural decomposition analysis(SDA) to identify the driving forces behind annual changes of carbon dioxide emissions embodied in China-EU trade. Results indicated that total export volume was the largest drivers for the growth in embodied carbon dioxide emissions, followed by intermediate input structure, while direct carbon dioxide emissions intensity was the largest driving forces for the decrease in embodied carbon dioxide emissions. The effect of export structure on embodied carbon dioxide emissions was the most smallest. According to the results beyond, we made some suggestions on the reduction of net exportsAccording to the results beyond, we made some suggestions on the reduction of net exports of carbon dioxide emissions embodied from China to EU. In terms of decreasing the carbon dioxide in exported goods from China to EU, China should enhance energy efficiency, improve intermediate input structure and adjust export structure. At the same time, in term of increasing the carbon dioxide in imported goods from China to EU, China should expand the total import volume and optimize import structure.