Sustainable China Trade: A Conceptual Framework

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• China's rapid trade growth has led to significant environmental degradation, with 16 of the world's 20 most polluted cities being Chinese and an estimated domestic cost of air pollution ranging from 3-7 per cent of GDP.
• The Chinese economy is characterized by a high energy intensity of production, which is 20 per cent higher than the OECD average, contributing to increased greenhouse gas emissions and energy security concerns.
• China's trade in goods is heavily reliant on processing trade, which accounted for 52.7 per cent of exports in 2006, resulting in low value-added contributions and limited capture of rents compared to brand owners and innovators.
• The framework for sustainable trade in goods emphasizes reducing 'unpaid inputs'—the degradation of air, water quality, and biodiversity—which effectively represents a transfer of wealth from China to the rest of the world.
• China faces a significant challenge in the sustainability of its commodity supply chains, with projected demand for aluminum, copper, nickel, and iron expected to reach 40 per cent of world demand by 2010.
• Trade in services, particularly transportation and tourism, accounts for a large portion of China's services trade (60 per cent of exports and 58 per cent of imports in 2006) but can cause environmental damage if unsustainably managed.
• China's role as a destination for waste management services is problematic, as over 70 per cent of discarded home electronics from developed countries end up in China, with only 10 per cent being recycled.
• China's outward direct investment (ODI) is dominated by energy investments (52 per cent), and the conduct of these investors abroad significantly impacts the 'China Brand' and the receptivity of foreign governments to further acquisitions.
• The document identifies three potential strategies for China to address trade challenges: normalization (complying with international norms), exceptionalism (opting out of norms), and transformation (changing international rules to suit Chinese realities).

APA

Cosbey, A. (2009). Sustainable China Trade: A Conceptual Framework. International Institute for Sustainable Development. https://www.iisd.org/system/files/publications/sustainable_china_trade_framework.pdf

Chicago

Cosbey, Aaron. Sustainable China Trade: A Conceptual Framework. International Institute for Sustainable Development, 2009. https://www.iisd.org/system/files/publications/sustainable_china_trade_framework.pdf.

Wikipedia

{{cite report |last1=Cosbey |first1=Aaron |title=Sustainable China Trade: A Conceptual Framework |publisher=International Institute for Sustainable Development |date=April 2009 |url=https://www.iisd.org/system/files/publications/sustainable_china_trade_framework.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{cosbey2009sustainable, author = {Cosbey, Aaron}, title = {{Sustainable China Trade: A Conceptual Framework}}, institution = {International Institute for Sustainable Development}, year = {2009}, month = apr, url = {https://www.iisd.org/system/files/publications/sustainable_china_trade_framework.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }