How do CO2 emissions compare when we adjust for trade?

CO₂ emissions are typically measured on the basis of ‘production’. This accounting method – which is sometimes referred to as ‘territorial’ emissions – is used when countries report their emissions, and set targets domestically and internationally.¹

In addition to the commonly reported production-based emissions statisticians also calculate ‘consumption-based’ emissions. These emissions are adjusted for trade. To calculate consumption-based emissions we need to track which goods are traded across the world, and whenever a good was imported we need to include all CO₂ emissions that were emitted in the production of that good, and vice versa to subtract all CO₂ emissions that were emitted in the production of goods that were exported.

Consumption-based emissions reflect the consumption and lifestyle choices of a country’s citizens.

Which countries in the world are net importers of emissions and which are net exporters?

In the interactive map we see the emissions of traded goods. To give a perspective on the importance of trade these emissions are put in relation to the country’s domestic, production-based emissions.²

• Countries shown in red are net importers of emissions – they import more CO₂ embedded in goods than they export.
  
  For example, the USA has a value of 7.7% meaning its net import of CO₂ is equivalent to 7.7% of its domestic emissions. This means emissions calculated on the basis of ‘consumption’ are 7.7% higher than their emissions based on production.

• Countries shown in blue are net exporters of emissions – they export more CO₂ embedded in goods than they import.
  
  For example, China’s value of -14% means its net export of CO₂ is equivalent to 14% of its domestic emissions. The consumption-based emissions of China are 14% lower than their production-based emissions.

We see quite a regional East-West split in net exporters and importers: most of Western Europe, the Americas, and many African countries are net importers of emissions whilst most of Eastern Europe and Asia are net exporters. 

You can find these figures in absolute (tonnes of CO₂) and per capita terms for each country in the Additional Information section.

How do consumption-based emissions compare to production-based emissions?

How did the differences between a country’s production and consumption-based emissions change over time?

In the interactive charts you can compare production- and consumption-based emissions for many countries and world regions since the first data is available in 1990.³ One chart shows total annual emissions, the other one shows the same on a per capita basis. Using the ‘change country’ toggle of the chart you can switch between them. 

Individual maps of consumption-based annual and per capita emissions can also be found in the Additional Information which follows this post.

We see that the consumption-based emissions of the US are higher than production: In 2016 the two values were 5.7 billion versus 5.3 billion tonnes – a difference of 8%. This tells us that more CO₂ is emitted in the production of the goods that Americans import than in those products Americans export.

The opposite is true for China: its consumption-based emissions are 14% lower than its production-based emissions. On a per capita basis, the respective measures are 6.9 and 6.2 tonnes per person in 2016. A difference, but smaller than what many expect. 

Whilst China is a large CO₂ emissions exporter, it is no longer a large emitter because it produces goods for the rest of the world. This was the case in the past, but today, even adjusted for trade, China now has a per capita footprint higher than the global average (which is 4.8 tonnes per capita in 2017). In the Additional Information you find an interactive map of how consumption-based emissions per capita vary across the world.

These comparisons provide the answer to the question whether countries have only achieved emissions reductions by offshoring emissions intensive production to other countries. If only production-based emissions were falling whilst consumption-based emissions were rising, this would suggest it was ‘offshoring’ emissions elsewhere.

There are some countries where this is the case. Examples where production-based emissions have stagnated whilst consumption-based CO₂ steadily increased include Ireland in the early 2000s; Norway in the late 1990s and early 2000s; and Switzerland since 1990.

On the other hand there are several very rich countries where both production- and consumption-based emissions have declined. This has been true, among others, for the UK (chart), France (chart), Germany (chart), and the USA (chart). These countries have achieved some genuine reductions without outsourcing the emissions to other countries. Emissions are still too high in all of these countries, but it shows that genuine reductions are possible.

In most countries emissions increased when countries become richer, but this is also not necessarily the case: by comparing the change in consumption-based emissions and economic growth we see that many countries have become much richer while achieving a reduction of emissions.