Together, China, the US, and the EU emit nearly half of the world’s greenhouse gases

Together, China, the US, and the EU emit nearly half of the world’s greenhouse gases

Description

The world’s largest greenhouse gas emitters need to collaborate to address climate change while preserving trade relations.

Together, China, the United States, and the European Union account for 60 percent of world GDP and are the world’s top carbon dioxide emitters, collectively emitting nearly half of the world’s greenhouse gases. China, the largest emitter, accounted for 26 percent of global emissions in 2019 because of its enormous economy and its role as a net exporter of manufactured goods produced by highly emitting processes.

The challenge lies in the varied and heterogenous climate policies of all three entities, resulting from their differences in government, economic development, the role of government in their economies, and their patterns of production and consumption. Trade frictions have emerged over concerns that one country’s policies—such as China’s subsidies, the US Inflation Reduction Act, or the European Union’s proposed carbon border adjustment mechanism—will likely harm firms and workers outside its borders. Yet, no progress on the intersection of climate policy and trade policy is possible unless these three main protagonists resolve their major differences over trade rules.

This PIIE Chart is adapted from Chad P. Bown and Kimberly A. Clausing’s working paper, How trade cooperation by the United States, the European Union, and China can fight climate change.

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