An Economy-wide Analysis of the Energy and Environmental Impacts of International Trade Policy Adjustments for Chemical Industry in China

In China, the proportion of energy consumption and carbon emissions embodied in international trade in chemical industry is high. It is important to consider how international trade policy adjustments in chemical industry will affect the economy and environment so as to achieve the goal of carbon intensity. This study investigates the impact of international trade policy adjustments. We adopt a computable general equilibrium model to simulate the impacts of trade policy adjustment. The result shows all adjustment plans cause economic losses. All plans will promote energy structure toward cleaner. All plans reduce CO₂ emissions and energy consumption but cannot realize the carbon intensity and energy intensity target. The adjustment of tariff policy in basic raw materials sector should be smaller than that of other sectors. Raising the export tariff is the best policy choice for achieving the carbon intensity target, but other low-carbon policies should be introduced. In particular, protection measures should be taken for the energy industry.