Leveraging International Trade for the Ecological Transition

The latest Planetary Boundaries update portrays an alarming global ecological situation in which six of the nine boundaries are transgressed. As a large share of human economic activities is enabled by international trade, this paper aims to analyze the footprints of global trade over the planetary boundaries. Using a multi-regional input-output database, we calculate environmental footprints embodied in trade relations related to the different planetary boundaries for different countries and economic activities through a modified method of consumption-based accounting. Results suggest that the pressure on planetary boundaries attributable to global trade ranges from 19% to 50%, depending on the boundary. The heterogeneity in pressure levels reflects the diverse economic structures of countries and regions, highlighting the influence of geographic and productive factors on ecological footprints. In general, Europe, North America and East Asia tend to be major regions impacting boundaries due to their import structure. However, from an export perspective, the picture is more heterogenous, with almost every single region contributing to pressures in a different way. All in all, global trade policies appear to be an important potential leverage to mitigate pressures on planetary boundaries.