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Open AccessArticle

International Market Leakage from China’s Forestry Policies

by Xin Hu 1,2,*, Guoqing Shi 2 and Donald G. Hodges 3
1
Business College, Hohai University, Nanjing 211100, China
2
National Research Center for Resettlement, Hohai University, Nanjing 210098, China
3
Natural Resource Policy Center, Department of Forestry, Wildlife and Fisheries, The University of Tennessee, Knoxville, TN 37996-4563, USA
*
Author to whom correspondence should be addressed.
Forests 2014, 5(11), 2613-2625; https://doi.org/10.3390/f5112613
Received: 10 October 2014 / Revised: 27 October 2014 / Accepted: 31 October 2014 / Published: 5 November 2014
Carbon leakage can be a problem when seeking to reduce carbon emissions through forest policy. International market leakage is mainly caused by supply and demand imbalances in the timber market. This paper selects China, which is implementing forestry policy changes, as the research object. We begin by offering a brief analysis of China’s forestry policy changes, such as the logging quota and Six Key Forestry Programs to determine whether those policies affect timber supply. Second, through the use of three shock variables, carbon leakage is simulated under different scenarios by the Global Trade Analysis Project (GTAP) model. The results reveal that the magnitude of leakage caused by implementing China’s forestry policies is between 79.7% and 88.8% with carbon leakage mainly displaced to Russia, Southeast Asia, and the EU. Two effective scenarios for reducing market leakage are presented: forest tenure reform and fast growing forest projects to improve domestic timber production, and raising tariffs on timber imports to reduce imports. View Full-Text
Keywords: market leakage; China; forestry policies; global trade analysis project market leakage; China; forestry policies; global trade analysis project
MDPI and ACS Style

Hu, X.; Shi, G.; Hodges, D.G. International Market Leakage from China’s Forestry Policies. Forests 2014, 5, 2613-2625.

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