Industry and globalisation

Carbon Dioxide Emissions Embodied in International Trade


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Last update: August 2013


Production-based and consumption-based‌ CO2 emissions for selected countries (2009)

Barchart China, USA

Efforts to mitigate greenhouse gas (GHG) emissions, such as the Kyoto Protocol, will be less effective in reducing global emissions of GHG if countries with emission commitments relocate their carbon-intensive production activities to countries without such commitments, particularly if production in the latter countries is GHG-intensive. The OECD’s input-output tables, bilateral trade in goods (BTDIxE) and services statistics (TIS) and IEA's energy statistics (e.g. fuel-combustion-based CO2 and international electricity transfer), together with other industry statistics, can be used to estimate the effects of international transfers of CO2 emissions. The simulation results highlight differences among countries in production-based emissions and consumption-based emissions.

Barchart top 3-15


Per capita CO2 production and consumption, 1995 and 2009

Per capita CO2 production and consumption

Sources: IEA CO2 Emissions from Fuel Combustion, 2012; OECD, Inter-country Input-Output (ICIO) Data base, May 2013.

Note: If the consumption-based figure is larger than production-based CO2, the country is net CO2 importer.



  • Consumption-based CO2 emissions of OECD countries (10.1 billion tons CO2) were, on average, about 15% higher in 2009 than conventional measures of production-based emissions suggest (11.6 billion tons CO2). The difference exceeds 40% in seven OECD countries (Belgium, Switzerland, Denmark, Greece, Ireland, Italy, Norway and Sweden). As expected, the magnitude of the differences increased in the late 1990s as trade in goods (and services) increased in the 2000s.
  • The emissions structure of countries varies owing to differences in consumption activities, sources of electricity generation and the carbon intensity of imported goods. Electricity-sourced emissions are relatively high in emerging economies (e.g. China and India), whereas emissions due to transport activity and consumption of imported goods are relatively high in developed OECD economies (e.g. Japan and United States).
  • The gap between trade-adjusted consumption-based CO2 emissions and production-based emissions increases between the mid-1990s and the mid-2000s. However, the emissions from both perspectives decreased in the late 2000s partly reflecting the economic crisis. By the mid-2000s, the regional contributions to increasing emissions had shifted so that about 12% of the global increase in CO2 emissions between 2000 and 2005 came directly from OECD economies with a quarter attributable to OECD consumption. Since the late 2000s, CO2 emissions of non-OECD economies surpass the emissions of the OECD group, both in terms of production-based and consumption-based emissions. 



OECD's trade balances of CO2 emissions (Mton CO2, 1995-2009)

OECD's trade balances of CO2 emissions, 1995-2009




Transactions within the international production network and imports and exports of final goods and services can be estimated by using an inter-country economic model based on multi-regional input-output (MRIO) modelling techniques. In order to achieve this, national Input-Output tables are first converted to a common currency (nominal USD) and the import matrices are disaggregated to separate bilateral flows of goods and services. A range of adjustments to deal with measurement issues such as re-exports; unspecified partners and commodities; and missing data, particularly for trade in services, are necessary before the analysis.


The consumption-based emissions of target country j’s resident are calculated as:


Formula consumption-based emissions


The production-based emissions of target country j’s resident are calculated as:


Formula production-based emissions


where hji is emission factor of final consumption of the products of country j’s sector i (hji=θji+φji), eji is industrial emissions intensity of country j’s sector i (eji=εji+ρji+σji), R is number of countries, B is Leontief inverse, N is number of sector and F1ji is final expenditure by country j for the country 1’s product of sector i.


The complete methodology can be found here: CO2 Emissions Methodology Formula



Data Access

Results are available on OECD.Stat and in a summary table 



Further Reading

  • OECD work on Green Growth (OECD.Stat)
  • Nakano et al. (2009), "The Measurement of CO2 Embodiments in International Trade: Evidence from the Harmonised Input-Output and Bilateral Trade Database", OECD STI Working Paper 2009/3
  • Ahmad and Wyckoff (2003), "Carbon Dioxide Emissions Embodied in International Trade of Goods", OECD STI Working Paper 2003/15
  • Measuring Progress Towards Green Growth: OECD Indicators [C(2011)30]
  • Sample table and charts
  • OECD Structural Analysis (STAN) Database