The Impacts of COVID-19 on China's Economy and Energy in the Context of Trade Protectionism.

Feng Wang,Min Wu

doi:10.3390/ijerph182312768

Abstract

In the current context of rising trade protectionism, deeply understanding the impacts of COVID-19 on economy and energy has important practical significance for China to cope with external shocks in an uncertain environment and enhance economic resilience. By constructing an integrated economic and energy input-output model including the COVID-19 shock, this paper assesses the impacts of COVID-19 on China’s macro-economy and energy consumption in the context of trade protectionism. The results are shown as follows. First, in the context of protectionism, the outbreak of COVID-19 in China would cause a 2.2–3.09% drop in China’s GDP and a 1.56–2.48% drop in energy consumption, while adverse spillovers from global spread of COVID-19 would reduce its GDP by 2.27–3.28% and energy consumption by 2.48–3.49%. Second, the negative impacts of domestic outbreak on China’s construction, non-metallic mineral products, and services would be on average 1.29% higher than those on other industries, while the impacts of global spread of COVID-19 on export-oriented industries such as textiles and wearing apparel would be on average 1.23% higher than other industries. Third, the effects of two wave of the pandemic on China’s fossil energy consumption would be on average 1.44% and 0.93% higher than non-fossil energy consumption, respectively.

Highlights

Since the outbreak of the 2008 financial crisis, trade protectionism has gradually risen in the international market [1,2]
The integrated economic and energy input-output (IEEIO) model is constructed by integrating the global multi-regional input-output (GMRIO) model and the global energy multi-regional supply and use (GEMRSU) model
Since this paper aims to analyze the short-term effects of COVID-19 on China’s economy and energy, technology could be assumed to be constant in the short term

Summary

Introduction

Since the outbreak of the 2008 financial crisis, trade protectionism has gradually risen in the international market [1,2]. The panic caused by the pandemic may further exacerbate global trade protectionism [3,4]. This shows that the COVID-19 pandemic poses a huge challenge to China’s economy in the context of trade protectionism. Smith et al [7] argued that the pandemic would cause a decline in energy consumption in major carbon-emitting countries. Wang and Su [9] suggested that the reductions in economic activity and the restrictions on transport caused by COVID-19 has significantly decreased China’s energy consumption, especially coal consumption. The above evidence indicates that the COVID-19 pandemic will bring substantial challenges to China’s economy and affect its energy consumption. Other literature focuses on the effects of the pandemic on energy and environment, such as Academic Editor: Dirga

Objectives

Methods

Results

Conclusion