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Impacts of COVID-19 and fiscal stimuli on global emissions and the Paris Agreement

Author

Listed:
  • Yuli Shan

    (Energy and Sustainability Research Institute Groningen, University of Groningen)

  • Jiamin Ou

    (Utrecht University
    University of East Anglia)

  • Daoping Wang

    (Shanghai University of Finance and Economics)

  • Zhao Zeng

    (Tianjin University)

  • Shaohui Zhang

    (Beihang University
    International Institute for Applied Systems Analysis)

  • Dabo Guan

    (Tsinghua University
    University College London)

  • Klaus Hubacek

    (Energy and Sustainability Research Institute Groningen, University of Groningen
    International Institute for Applied Systems Analysis)

Abstract

The global economy is facing a serious recession due to COVID-19, with implications for CO2 emissions. Here, using a global adaptive multiregional input–output model and scenarios of lockdown and fiscal counter measures, we show that global emissions from economic sectors will decrease by 3.9 to 5.6% in 5 years (2020 to 2024) compared with a no-pandemic baseline scenario (business as usual for economic growth and carbon intensity decline). Global economic interdependency via supply chains means that blocking one country’s economic activities causes the emissions of other countries to decrease even without lockdown policies. Supply-chain effects contributed 90.1% of emissions decline from power production in 2020 but only 13.6% of transport sector reductions. Simulations of follow-up fiscal stimuli in 41 major countries increase global 5-yr emissions by −6.6 to 23.2 Gt (−4.7 to 16.4%), depending on the strength and structure of incentives. Therefore, smart policy is needed to turn pandemic-related emission declines into firm climate action.

Suggested Citation

  • Yuli Shan & Jiamin Ou & Daoping Wang & Zhao Zeng & Shaohui Zhang & Dabo Guan & Klaus Hubacek, 2021. "Impacts of COVID-19 and fiscal stimuli on global emissions and the Paris Agreement," Nature Climate Change, Nature, vol. 11(3), pages 200-206, March.
    • Handle: RePEc:nat:natcli:v:11:y:2021:i:3:d:10.1038_s41558-020-00977-5
    DOI: 10.1038/s41558-020-00977-5
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    References listed on IDEAS

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