Does participation in China-U.S. trade impede carbon emission reduction efforts across countries?

Abstract

Climate change remains a critical global challenge, highlighting the need to address the environmental consequences of international trade. This study examines the underexplored impact of participation in China-U.S. trade on the carbon emission intensities of 189 countries from 2000 to 2021. Using the EORA26 database and a global value chain framework, we analyze multi-regional input-output data across 26 sectors to explore the trade‑carbon nexus. The findings show that countries involved in China-U.S. trade often experience higher carbon intensities than their global trade averages, though this disparity narrows over time. Regional trends reveal stark differences: North American and European countries have shown a continuous decline in their relative carbon emission intensity, while Asia, South America, and Africa exhibit diverse trajectories shaped by economic and industrial structures. Sectoral analysis identifies electricity, gas, and water as persistently high-emission industries, while sectors such as electrical and machinery demonstrate environmental gains. Additionally, trade flow direction significantly influences carbon impacts, underscoring the asymmetry in emissions between re-exports to the U.S. via China and vice versa. These insights deepen our understanding of global trade's role in carbon dynamics, offering actionable guidance for policymakers to design regionally and sectorally tailored strategies. Such approaches can mitigate trade-driven emissions while fostering inclusive and sustainable economic growth across diverse regions and industries. By addressing sectoral and regional disparities, this study helps bridge the gap between economic objectives and global climate goals.