Trade Remedies and Environmental Protection Amid the US-China Trade Dispute

Abstract

Environmental protection initiatives as well as international economic relations have been significantly impacted by the US-China trade conflict, which has been characterized by the heavy use of tariffs and trade remedies. This study looks at how trade remedies implemented during the conflict affected carbon emissions, the use of clean technology, and the enforcement of regulations. The paper emphasizes both favorable and unfavorable results by referencing empirical facts, environmental economics, and international trade legislation. Tariffs caused carbon leakage by moving high-emission output to nations with laxer environmental standards, even if they also offered some incentives for home sectors to increase energy efficiency and promote green innovation. Decarbonization efforts were further slowed by the interruption of supply lines for renewable energy. Integrating sustainability aims into trade defense efforts is made more difficult by the World Trade Organization's (WTO) legal framework, which permits environmental exceptions in trade measures but provides little clarity surrounding trade remedies. The report suggests eco-conditional trade probes, increased stakeholder involvement, and WTO reforms to align trade and environmental goals. It also proposes a paradigm shift in trade remedy policy to transparently and scientifically include environmental criteria. To reduce carbon leakage within the limitations of trade legislation, the growing application of border carbon adjustments is examined as a potential but intricate instrument. Finally, by providing policy insights pertinent to governments, international organizations, and industry stakeholders navigating the intertwined challenges of economic growth, this research adds to the growing conversation about how international trade instruments can promote rather than undermine climate goals.