 Trade, finance, and the environment: The effects of green trade financing on carbon emissionsJin Sun, Kamiar Mohaddes and Meng Cai Energy Economics, 2026, vol. 154, issue C Abstract: The rapid expansion of green trade financing is reshaping global trade dynamics and offering new opportunities for carbon emission reduction. Our study examines the impact of Green Trade Financing on carbon emissions across a global sample of countries from 2012 to 2022, providing new insights into the environmental advantages of green or sustainable trade policies. The empirical results demonstrate that green trade financing significantly reduces carbon emissions, mainly through two channels: promoting green innovation and improving energy structure. Mechanism analysis confirms that it enhances firms' environmentally oriented innovation and facilitates the transition toward cleaner energy. These findings underscore the environmental benefits of green finance and highlight its role as a scalable instrument for sustainable development. The study also provides multi-level policy recommendations to operationalize green trade financing under diverse institutional conditions. Keywords: Green trade financing; Carbon emissions; Sustainable trade practices; Climate change (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:154:y:2026:i:c:s0140988326000265 DOI: 10.1016/j.eneco.2026.109147 Access Statistics for this article Energy Economics is currently edited by R. S. J. Tol, Beng Ang, Lance Bachmeier, Perry Sadorsky, Ugur Soytas and J. P. Weyant More articles in Energy Economics from Elsevier |
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