Earth's Economy Slowed in February 2023

According to the Mauna Loa Observatory, the rate at which carbon dioxide is accumulating in the Earth’s atmosphere continued slowing in February 2023. As a global economic indicator, that change suggests the world’s economy slowed along with it.

The change comes as recent news headlines have flagged lackluster economic growth during the first two months of 2023, particularly in China:

• China’s economic recovery is off to a slow start
• What China’s underwhelming economic growth target means for the world
• China Jan-Feb trade likely contracted again as global economy slowed

We’re featuring headlines that focus on China’s economic recovery because the country is, by a very wide margin, the world’s leading producer of carbon dioxide emissions, which are correlated with its economic output. The country is also the world’s largest exporter of goods to other nation’s economies with its CO₂ emissions described as being embodied in its imports and exports.

For February 2023, the following chart reveals the trailing year average of the year-over-year change in atmospheric CO₂ levels has dropped to its lowest level since October 2018.

That October 2018 low coincides with the early months of the U.S. and Chinese government’s trade war, which had started in July 2018 with both nations slapping large tariffs on goods imported from the other. At the end of October 2018, China’s government ramped up its efforts to stimulate its economy to offset the negative impact from the trade war. The Chinese government’s economic stimulus ultimately showed up in the Earth’s atmosphere through increasing carbon dioxide emissions that continued until the onset of the coronavirus pandemic at the end of 2019.

Since we had expected the downtrend in the pace of CO₂ accumulation in Earth’s atmosphere to reverse in February 2023 with the December 2022 lifting of China’s zero-COVID lockdowns, a larger, global economic slowdown could account for its continued decline. There are however new signs that China’s economic activity is expanding more rapidly with global trade picking up, so the anticipated reversal may only be delayed.

References

National Oceanographic and Atmospheric Administration. Earth System Research Laboratory. Mauna Loa Observatory CO2 Data. [Text File]. Updated 5 March 2023.

Global Carbon Project. (2022). Supplemental data of Global Carbon Budget 2022 (Version 1.0) [Data set]. Global Carbon Project. DOI: 10.18160/gcp-2022.

Image source: NASA