The impact of China’s foreign trade on their Actual-Open Emissions of CO₂ in the years 2000–2020 in the context of EU energy policy

Aim:  This article aims to analyze the impact of China’s trade with 78 major trading partners on Actual-Open Emission of CO₂ (EAO) from 2000 to 2020 in light of the European Union's (EU) goal to reduce CO₂ emissions by 20% by 2020 compared to 1990 levels. Research Methods: The research is based on the Actual-Open Emission of CO₂ model and employs the circular flow model to assess the influence of China's foreign trade on CO₂ emissions during the years 2000–2020. Findings: The study revealed that China’s foreign trade significantly influenced its CO₂ emissions in all years analyzed, with positive contributions to EAO due to a trade surplus (exports exceeding imports). As the world’s largest exporter and the second-largest importer, China’s trade activity resulted in substantial CO₂ emissions. Four key indicators were identified as influencing the difference between Official-Close Emission of CO₂ (EOC) and EAO: China’s GDP, the percentage of exported GDP, the percentage of imported GDP, and EOC levels. These findings highlight the significant role of trade in China’s CO₂ emissions, which is critical in the context of EU initiatives like “Fit for 55.” JEL: F18, Q54, Q56,