Trade Liberalization and the Environment: The Case of China

Abstract

China has been involved in the process of globalization since 1978 through a comprehensive liberalization of its foreign trade and investment regimes. Especially after becoming a member of the World Trade Organization in 2001, CO2 emissions in China have increased. China's economy is growing very fast, which is the main cause of China's air pollution. Trade liberalization and increased openness are seen as a means of promoting economic growth for developing countries. However, most studies have revealed that trade liberalization has negative impacts on the environment. Therefore, the aim of this study is to examine how trade liberalization affects the environment in China by examining the literature on the trade-environment debate. The findings indicate that trade liberalization leads to economic development but has had negative impacts on the environment in China.