Exergy analysis of natural resources embodied in China's interregional trade and its implication for regional imbalance

Large-scaled interregional trade is based upon massive exchanges of natural resources, leading to more environmental emissions and economic imbalance. China is the largest trade country in the world and has to face such challenges since different Chinese provinces are in different development stages with different resource endowments. By using the latest multi-regional input-output (MRIO) tables and exergy accounting, this study aims to investigate natural resources and added values embodied in interregional trade in China for years of 2012, 2015, and 2017. Regional environmental inequality (REI) index and logarithmic mean Divisia index (LMDI) were applied to measure the imbalance states and uncover corresponding driving factors. Results show that the total trade volumes in the middle Yellow River and eastern coastal regions were generally higher than those in other regions, together accounting for 41.50 ~ 41.78% of the total trade volume during the study period. The major flows of embodied natural resources shifted from the middle Yellow River region to western coastal, eastern coastal, and southern coastal regions. The northern coastal and eastern coastal regions were the major exporters of embodied added value. Less developed regions had higher REI values, indicating more environmental and economic losses than developed regions. Natural resources intensity was the major impact factor on the trade imbalances in most provinces. This study provides valuable insights for alleviating trade imbalance and promoting sustainable natural resources management based on cross-regional collaboration.

Carbon emissions embodied in the global supply chain: Intermediate and final trade imbalances

By differentiating intermediate trade from final trade, this paper combines typical statistics for the world economy in 2012 to explore the transfer of embodied carbon emissions via the global supply chain and the related trade imbalance. The emission transfer embodied in interregional trade is in magnitude around 40% of global direct carbon emissions. The global intermediate trade volume of embodied carbon emissions is estimated to be 2.3 times as much as the final trade volume. While Mainland China obtains a considerable economic trade surplus, its carbon trade deficit is about twice the carbon trade surplus of the United States. Mainland China's final trade deficit is around 1.2 times as much as its intermediate trade deficit of embodied carbon emissions. EU27, the United States, ASEAN and Japan serve as the major contributors to China's intermediate and final trade deficits. For the United States, its intermediate carbon trade surplus is almost equal to its final trade surplus. The United States gains a carbon surplus with most of its trading partners in both intermediate and final trades. A future scenario analysis in terms of carbon emission projection is conducted. While the direct and embodied carbon emissions of the United States and Japan are estimated to change slightly from 2012 to 2040, India's carbon emissions are projected to experience a twofold increase during the period. In the long term, though with ups and downs, the economic globalization will be inevitably moving forward, leading to a highly sliced-up global supply chain and increasingly delicate regional specialization as well as frequent intermediate trade between regions. It is suggested that nations and regions should follow this trend and adapt themselves to the global value chain by carefully assessing their roles in intermediate and final trades in terms of both currency and embodied carbon emissions.

Energy use by globalized economy: Total-consumption-based perspective via multi-region input-output accounting

Within a single integrated globalized economy featuring robust fluxes of interregional trades, the world economy is like a giant bathtub containing the world inventory of energy use. Based on different norms or ethic percepts, the energy use of the world economy is reallocated to nations and regions via global supply chain using normative accounting schemes. By combining typical statistics for world economy 2012, a new perspective is presented in this study to look into the energy use of regional economies from the side of genuine final consumers. Parallel to the final-demand-based accounting method, a total-consumption-based multi-region input-output accounting method is developed following the norm of consumption being the ultimate end and purpose of all producing activities. From a total-consumption-based perspective, the energy use of the United States economy is shown in magnitude 1.8 times that of mainland China, compared to a ratio of 88% from a territorial-based perspective. The consumer-product-related trade imbalances of major economies in terms of both currency and energy use are analyzed, with major interregional net trade flows illustrated. While the United States and mainland China are respectively revealed as the leading net exporter and net importer of currency, the energy trade deficit of the latter is in magnitude around four times the energy trade surplus of the former. The trade structures by geography and sector are respectively presented for the United States and mainland China as two distinct economies. It is found that around half of the United States' exports of energy use originate from transport and service industries, while nearly 90% of mainland China's exports of energy use come from heavy industry. The findings are supportive for nations to identify their roles in the global supply chain from the perspective of genuine final consumers and adjust the trade patterns for sustained energy use.