GTAP Resources: Resource Display

GTAP Resource #7807

"Unintended Consequences of EU-Climate Policies: Carbon Leakage in Global Forest and Agricultural Markets"
Authors: Pelikan, Janine, Soeren Deerberg, Tomke Honkomp, Florian Freund, Franziska Schier and Omid Zamani


Abstract
In July 2025, the European Commission (EC) proposed an EU climate target for 2040 that would reduce net greenhouse gas (GHG) emissions by at least 90% relative to 1990, before reaching climate neutrality in 2050.
Unilateral EU climate mitigation may generate international spillover effects through changes in global production, trade, and emissions. One major concern is carbon leakage, whereby emission-intensive production is displaced to non-EU regions in response to domestic climate policies. This analysis broadens the EC’s impact assessment underlying the 2040 climate target proposal beyond impacts within the EU and more granularly evaluates consequences for global forest and agricultural markets. For this purpose, the global forest sector model TiMBA is linked with the computable general equilibrium model MAGNET. A joint baseline is constructed under SSP2 assumptions, and two policy scenarios are implemented. In a higher-ambition scenario, forestry contributions to LULUCF mitigation targets and agricultural non-CO2 GHG reduction targets follow Scenario 3 of the EC’s impact assessment while in a lower-ambition scenario, reduction pathways for forestry and agriculture are consistent with corresponding Scenario 2. In both cases forestry provides 75% of the required LULUCF mitigation. The analysis evaluates changes in production, trade patterns, and emissions at the country and sectoral level and quantifies potential leakage effects.


Resource Details () GTAP Keywords
Category: 2026 Conference Paper
Status: Published
By/In: Presented during the 29th Annual Conference on Global Economic Analysis (Kyoto, Japan)
Date: 2026
Version: Draft
Created: Pelikan, J. (4/14/2026)
Updated: Pelikan, J. (4/14/2026)
Visits: 11
- Climate change policy
- Environmental policies
- Trade and the environment
- Agricultural policies
- Model integration and coupling


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Last Modified: 4/15/2026 11:27:11 AM