Pollution havens along the Belt and Road
Environmental degradation is one of the fastest-rising keywords in the economics journals, and the Belt and Road Initiative is a large topic in finance and economics. But the pollution haven hypothesis appears on only 14 recent papers. Did Chinese investment abroad move dirty production to countries with weaker rules?
What prompted this#
In economics, "environmental degradation" had 13 papers in July–September 2026 against about 5 expected (see the economics dashboard). Since October 2025, the Belt and Road Initiative appears on 48 papers and outward foreign direct investment on 52, but the pollution haven hypothesis and its variants on only 14, of which 5 also carry a Belt and Road or outward-investment keyword.
Questions#
- Do Chinese-financed plants abroad (power, steel, cement) emit more per unit of output than similar plants financed by others in the same countries?
- Did China's 2021 pledge to stop building new coal power plants abroad change the mix of projects?
- Does local enforcement, more than national rules, decide where dirty projects go?
Data that could help#
Databases of overseas development finance (for example Boston University's China's Global Power Database), plant-level emissions and satellite pollution measures, and indices of environmental regulation by country.
Next step#
Match Chinese-financed power plants abroad to satellite measures of nearby air pollution, and compare them with other plants of the same type and age.