International Trade Reshapes the Decoupling of Emissions from Economic Growth

Efforts to stabilize the global climate change while also continuing human development depend upon "decoupling" economic growth from fossil fuel CO₂ emissions. However, evaluations of such decoupling have typically relied on production-based emissions, which do not account for emissions embodied in international trade. Yet international trade can greatly change emissions accounting and reshape the decoupling between emissions and economic growth. Here, we evaluate decoupling of economic growth from different accounts of emissions in each of the 159 countries and analyze the drivers of decoupling. We find that between 1995 and 2015, although 29 countries exhibited strong decoupling of territorial emissions (growing economies and decreasing emissions), only 19 countries achieved economic growth while their consumption-based emissions decreased. Most developed countries have achieved decoupling of emissions related to domestic goods and services, but have not achieved decoupling of emissions related to imported goods and services. The U-test confirms that the domestic component of consumption-based emissions exhibits a stronger decoupling trend from gross domestic product (GDP) growth than consumption-based emissions, and emissions from imports continue to rise with GDP per capita without a corresponding decline, providing a statistical validation of the decoupling analysis. Moreover, in the countries where economic growth and consumption-based emissions are most decoupled, a key driver is decreasing emissions intensity due to technological progress─and especially reductions in the intensity of imported goods and services. Our results reveal the importance of assessing decoupling using consumption-based emissions; successful decoupling may require international cooperation and coordinated mitigation efforts of trading partners.