The Impact of China's Trade Liberalisation on the Greenhouse Gas Emissions of WTO Countries

We examine the effects of the growth of Chinese imports between 1995 and 2007 on the greenhouse gas (GHG) emissions of WTO countries. Using complementary estimators we establish that China's liberalised trade had significant effects on GHG emissions. The growth of Chinese imports increased the growth of consumption-based and imported emissions, and reduced the growth of emissions from domestic production in WTO countries. Moreover, offshoring emissions contributed to the growth of imported emissions that offset reductions in GHG emissions in domestically produced goods. China's liberalised trade has been driving a wedge between production and consumption emissions in developed countries