Abstract
International trade shifts production of a large amount of carbon dioxide (CO2) emissions embodied in traded goods from the importing country to the exporting country. The European Union (EU) plays a prominent role in the flow of international-related emissions as it accounts for the second largest share of global exports and imports of goods. Consumption-based accountings (CBA) emerged as alternative to the traditional emission inventories based on the Intergovernmental Panel on Climate Change (IPCC) guidelines. According to the IPCC criteria, countries where products are consumed take no responsibility for the emissions produced by exporter countries, thus neglecting the emissions embodied in trade. By taking this aspect into account, CBA are considered of great importance in revealing emissions attributed to the final consumer. Using a CBA approach, this paper evaluates the impact of international trade in the EU in terms of CO2 emissions, looking both at the internal trade flows within the EU-28 and at the external trade flows between the EU and the rest of the world during the period 2012–2015. We find that the EU is a net importer of emissions as its emissions due to consumption exceed those due to production. In particular, in 2015 the ratio between import- and export-embodied emissions was more than 3:1 for the EU-28 that imported 1317 Mt CO2 from the rest of the world (mainly from China and Russia) while exporting only 424 Mt CO2. Concerning emissions flows among EU countries, Germany represents the largest importer, followed by the UK. To get a deeper understanding on possible environmental implications of Brexit on UK emission responsibilities, the paper also advances a few hypotheses on how trade flows could change based on the existing trade patterns of the UK. Data analysis shows that a 10% shift of UK imports from EU partners to its main non-EU trading partners (India, China, and US) would increase its emission responsibility by 5%. The increase in UK emission responsibility would more than double (+11%) in case of a 30% shift of UK imports. Similar results would apply if UK replaced its current EU partners with its main Commonwealth trading partners as a result of Brexit.
Highlights
According to the NASA’s annual global analysis, 2016–2017 were the “record-warm” years since 1880 [1]
Using a Consumption-based accountings (CBA) approach, this paper evaluates the impact of international trade in the European Union (EU) in terms of CO2 emissions, looking both at the internal trade flows within the EU-28 and at the external trade flows between the EU and the rest of the world during the period 2012–2015
Ri = Data concerning CO2 emissions (DEi) − Ni + Qi where Ri is the ‘responsibility’ in terms of greenhouse gas (GHG) emission of country i, DEi measures direct emissions occurring in country i, according to a purely geographical criterion, Qi denotes emissions embodied in imports of country i, while Ni are emissions embodied in its exports
Summary
According to the NASA’s annual global analysis, 2016–2017 were the “record-warm” years since 1880 [1]. The increasing trend of global warming is mainly due to human activity and to its consequent greenhouse gas (GHG) emissions, mostly CO2 [2]. The European Union (EU) is one of the largest sources of global GHG emissions. Starting from the 1990s the EU set out important steps to combat climate change with the aim of reducing its GHG emissions [4]. The EU established a GHG reduction target of 20% and 40% below 1990 levels for 2020 and 2030, respectively [5]. The 2020 target has been achieved in advance with respect to what was originally planned. GHG emissions in the EU decreased by 23% between 1990 and 2016, while GDP grew by 53% over the same period [6]
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