Many climate activists are deeply concerned on the impact of Donald Trump’s recent election victory on efforts to reduce carbon dioxide emissions. So far, much of the attention has focused on Trump’s strong support for fossil fuels and his skepticism about clean energy initiatives.

However, the situation can be more complex. One of Trump’s priorities is to impose higher tariffs on Chinese goods. While economists warn that these tariffs could lead to a resurgence in inflation, they could also have a less-discussed impact that could affect global carbon dioxide emissions.

The potential climate impact of tariffs on Chinese goods is a multifaceted issue, influenced by a complex interplay of factors, including global emissions trends, the carbon intensity of manufacturing processes, and changes in consumer behavior and supply chains.

The carbon footprint of trade

Today, most of the world’s emissions come from countries in Asia and the Pacific region. The USA and the EU contribute a relatively small part of the global carbon dioxide emissions.

China is the world’s largest emitter of greenhouse gases. This is largely due to its reliance on coal for energy, especially in heavy industries such as steel, cement and chemical production. Many US imports from China have a significant carbon footprint, as China’s manufacturing sector is both energy-intensive and largely coal-powered.

By increasing the cost of Chinese products, tariffs can reduce demand for carbon imports, which could lead consumers and businesses to seek alternatives. This may mean switching to domestically produced goods, which often have a lower carbon footprint due to access to cleaner energy sources and stricter environmental regulations.

Domestic production and emissions

Relocating production to the United States could further reduce emissions, especially if it involves energy-intensive industries that can benefit from our country’s cleaner energy mix.

However, the effectiveness of this strategy depends on the ability of the United States to increase domestic production capacity and supply chains, which may require significant investment and time.

Consumer behavior and market forces

Tariffs can influence consumer behavior and drive demand for domestic products. If domestic purchases replace Chinese imports, this would align purchasing decisions with the goal of reducing global carbon emissions.

However, the effect of such behavioral changes on total emissions would depend on the availability of domestic alternatives.

Challenges and limitations

Despite the potential benefits, there are significant challenges to consider. The United States may lack the capacity to produce all goods domestically, and shifting production to other low-carbon countries may not be feasible. In addition, retaliatory tariffs can increase the cost of renewable energy components, hindering the transition to a cleaner energy future.

A collaborative approach

Instead of relying solely on tariffs, another strategy could involve a coordinated international approach. By combining tariffs with international climate agreements, such as carbon tariffs or border adjustment mechanisms, countries can directly target emissions that are included in trade. This could motivate China to move away from carbon-intensive industries, making its exports less competitive in global markets.

Conclusions

In sum, by driving up costs, tariffs can encourage consumers and businesses to seek alternatives, such as domestically produced goods with a lower carbon footprint. However, the effectiveness of this strategy depends largely on the ability of the United States to increase production sustainably, as well as the ability to manage potential inflation and international trade tensions that could offset these benefits.

If combined with policies that support cleaner domestic production and a robust supply chain, tariffs can play a role in the broader strategy to mitigate climate change.