2 Research on Urbanization and Low-Carbon Development in China
55
empirical results illustrated that (ln SI and ln TI in Table 2.1) across the country,
secondary industry exerts major impact on carbon dioxide emissions. Every 1%
increase in the share of the secondary industry in GDP is accompanied by 0.1168%
rise in carbon dioxide emissions. Cities’ service industry bears small and insignificant
impact on carbon dioxide emissions, implying less carbon footprint and smaller
environmental externality of the service industry. At the regional level, no major
impact was found from the service industry on carbon emissions of central and
western cities, pointing to the contribution of a growing tertiary industry to building
low-carbon cities there. However, the servie industry exerts considerable positive
impact on carbon emissions in eastern cities (0.516). This seemingly counterintuitive
empirical result could, in some measure, explain the following realities: the size of
cities in the east tends to be bigger than that in central and western China, calling
for tremendous amount of services to support urban life and work. Recent years
have witnessed accelerated industrial upgrading, with a great many heavy industries
in eastern cities relocated to central and western regions. The thing is, the service
industry is not entirely “pollution-free”. It also involves transportation emissions,
high energy consumption and dirty processes. The inherent low-carbon strength of
the service industry would not be maximized without proper planning and guidance
to enhance its internal structure and quality.
2.3.2.4 FDI in Cities and CO 2 Emissions
The impact of urbanization is not confined to the change of the industrial structure within the region. It opened up the relatively closed local economy, dramatically increasing the external dependence of the economy. Foreign direct investments
are utilized for factory building, mass production, product processing and export,
creating economic gains for cities. However, while benefiting from the relocation of
industrial capacity from the developed world, cities have also tasted the bitter fruit of
surging carbon emissions. The scale effect of urbanization may turn out to provide
“shelters” for pollution in Chinese cities. But in all fairness, the environmental effects
of FDI on Chinese cities are not all negative. Studies have found that FDI may help
phase out backward urban production capacity in developing countries, propelling
transformation of urban industrial structure and enhancement of local production
technologies and energy efficiency through technology spillover, triggering structural and technological upgrading, thus curbing greenhouse gas emissions in developing countries. So here comes the question: amid growing urbanization in China,
what impact on earth does FDI bring to China in terms of urban carbon emissions,
positive or negative? And how does it affect carbon dioxide emissions across cities
and regions in China?
An analysis of the FDI amount in Chinese prefecture-level cities from 2007 to
2018 was conducted to define its trend in these cities across regions in China, as
shown in Fig. 2.11. Statistics reveal that in the past 12 years, FDI has been on the
rise across prefecture-level cities of all regions in China, but with significant regional
differences in this regard, which can be found in its decreasing amount from the east
55
empirical results illustrated that (ln SI and ln TI in Table 2.1) across the country,
secondary industry exerts major impact on carbon dioxide emissions. Every 1%
increase in the share of the secondary industry in GDP is accompanied by 0.1168%
rise in carbon dioxide emissions. Cities’ service industry bears small and insignificant
impact on carbon dioxide emissions, implying less carbon footprint and smaller
environmental externality of the service industry. At the regional level, no major
impact was found from the service industry on carbon emissions of central and
western cities, pointing to the contribution of a growing tertiary industry to building
low-carbon cities there. However, the servie industry exerts considerable positive
impact on carbon emissions in eastern cities (0.516). This seemingly counterintuitive
empirical result could, in some measure, explain the following realities: the size of
cities in the east tends to be bigger than that in central and western China, calling
for tremendous amount of services to support urban life and work. Recent years
have witnessed accelerated industrial upgrading, with a great many heavy industries
in eastern cities relocated to central and western regions. The thing is, the service
industry is not entirely “pollution-free”. It also involves transportation emissions,
high energy consumption and dirty processes. The inherent low-carbon strength of
the service industry would not be maximized without proper planning and guidance
to enhance its internal structure and quality.
2.3.2.4 FDI in Cities and CO 2 Emissions
The impact of urbanization is not confined to the change of the industrial structure within the region. It opened up the relatively closed local economy, dramatically increasing the external dependence of the economy. Foreign direct investments
are utilized for factory building, mass production, product processing and export,
creating economic gains for cities. However, while benefiting from the relocation of
industrial capacity from the developed world, cities have also tasted the bitter fruit of
surging carbon emissions. The scale effect of urbanization may turn out to provide
“shelters” for pollution in Chinese cities. But in all fairness, the environmental effects
of FDI on Chinese cities are not all negative. Studies have found that FDI may help
phase out backward urban production capacity in developing countries, propelling
transformation of urban industrial structure and enhancement of local production
technologies and energy efficiency through technology spillover, triggering structural and technological upgrading, thus curbing greenhouse gas emissions in developing countries. So here comes the question: amid growing urbanization in China,
what impact on earth does FDI bring to China in terms of urban carbon emissions,
positive or negative? And how does it affect carbon dioxide emissions across cities
and regions in China?
An analysis of the FDI amount in Chinese prefecture-level cities from 2007 to
2018 was conducted to define its trend in these cities across regions in China, as
shown in Fig. 2.11. Statistics reveal that in the past 12 years, FDI has been on the
rise across prefecture-level cities of all regions in China, but with significant regional
differences in this regard, which can be found in its decreasing amount from the east