Outsourcing Manufacturing to China Results in High CO2 Emissions

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Despite the increasingly fervent debate regarding the trade relationship between China and the United States and its implications for the global political environment, it is evident that manufacturing goods in China and shipping them to developed countries has real-world consequences, particularly for the environment. University of Maryland researchers, in collaboration with others, have begun to quantify the magnitude of those impacts.

In a study published today in the journal Nature Climate Change, scientists from UMD, UCI and HArvard demonstrate that buying a product made in China causes significantly higher carbon dioxide emissions than purchasing the same product made elsewhere.

“International trade has become the fastest growing driver of global carbon emissions and China has the largest share in it. About one third of all emissions embodied in trade are through China,” said co-author Klaus Hubacek, University of Maryland professor of geographical sciences.

“The amazing increase in Chinese manufacturing over the past 15 years has driven the world economy to new heights and supplied consumers in developed countries with tremendous quantities of lower-cost goods,” said co-author Steven J. Davis, University of California Irvine assistant professor of Earth system science. “But all of this has come at substantial cost to the environment.”

The researchers from University of Maryland, the University of California, Irvine, and Harvard University quantified the reasons Chinese exports result in such high CO2 emissions. They found that “emissions intensity,” the quantity of CO2 emitted per dollar of goods produced, is by far the leading contributor to greater carbon pollution from Chinese manufacturing. China has a high emissions intensity score because of antiquated manufacturing processes and the fact that they get most of their energy from coal.

“The CO2 emissions related to China’s exports are large not just because they export a lot of stuff or because they specialize in energy-demanding industries, but because their manufacturing technologies are less advanced and they rely primarily on coal for energy," said Hubacek.

“A huge amount of emissions are from a small number of provinces and sectors in China and other developing countries, thus targeting these provinces and sectors by improving their emissions intensity provide excellent opportunities to reduce the overall world emissions at lower costs than setting ambitious mitigation goals in developed countries,” added co-author Kuishuang Feng, a research assistant professor of geographical sciences at the University of Maryland.

For this study, researchers paid particular attention to Chinese provinces with high emissions intensity. Steel mills, mineral processors and petrochemical plants in Guizhou, Inner Mongolia, Ningxia, Yunnan, and Shanxi are China’s dirtiest industries. Davis and his colleagues suggest that developed economies could do a lot to alleviate carbon pollution by helping improve manufacturing practices in these provinces.

“This analysis can help policy makers in China and internationally identify the industries and provinces in which efforts to identify and promote less energy-intensive manufacturing equipment and practices would have the largest leverage to reduce CO2 emissions,” said lead author Zhu Liu, a research associate at Harvard University and a Resnick Prize postdoctoral scholar at Caltech. “Given the differences we observe within industries and across provinces in China, many opportunities would involve creating incentives to promote the adoption of Chinese best practices.”