Responses of exporters to green trade barriers: evidence from China

Against the backdrop of rapid growth in green trade and increasingly stringent green trade barriers (GTBs), this paper examines the impact of GTBs on China’s exports of green products using data from 2009–2021. The empirical results show that GTBs significantly reduce the export value of China’s green products. First, at the product level, the inhibitory effect is strongest for high-tech green products, while effects on low- and medium-technology green products are limited. Second, at the destination level, barriers from economies with stringent environmental regulations reduce the export value of China’s green products, especially in high-technology products, whereas barriers from economies with lax environmental regulations promote China’s green exports, mainly on low-technology products. Moreover, the inhibitory effect becomes insignificant when environmental harmonization mechanisms exist between China and the destination. Third, in terms of trade margins, GTBs mainly reduce the export value of existing green products and increase their likelihood of exiting international markets, with no significant effect on the entry of new trade relationships. The findings suggest that policymakers should strengthen early-warning mechanisms for GTBs, adopt differentiated policy responses, and deepen international environmental policy coordination to mitigate trade barriers and promote green trade development.