Per capita CO2 emissions divergence influenced by bilateral trade with china under the belt and road initiative

Abstract

This paper is an empirical study of per capita CO 2 emissions divergence. Trade intensity reflects the strength of bilateral trade relations between China and the Belt and Road Initiative (BRI) countries. Using panel data covering 97 of the BRI countries from 2002 to 2017 and employing the dynamic panel system generalized method of moments (GMM) model with additional instrumental variables of remoteness and the Shapley value decomposition technique, this study has three main findings. First, the import intensity from China tends to restrain per capita CO 2 emissions, but the export intensity to China tends to promote per capita CO 2 emissions of BRI countries. Second, the Gini coefficient of per capita CO 2 emissions continually decreases, representing a gradually weakened divergence. Third, from 2009 the impact of import intensity from China on the divergence changed from increasing CO 2 emissions to restraining them. However, export intensity to China has continually promoted the divergence among the BRI countries, with the impact being largest in 2016. The results suggest that China should adjust the sources of its energy imports and the destinations of its exports, and develop green trade cooperation with the BRI countries to jointly tackle climate change.