Green Technologies And Their Impact On Global Trade And Investment

Abstract

The rapid diffusion of green technologies is transforming patterns of global trade and investment. In 2024, global energy-transition investment surpassed US$2.1 trillion, led by electrified transport (US$757 billion) and renewable energy (US$728 billion) (BloombergNEF, 2025). Electric vehicles accounted for nearly 14 million sales worldwide in 2023, representing 18% of all car sales, with China, Europe, and the United States dominating demand (IEA, 2024b). Meanwhile, China consolidated its position as the hub of solar photovoltaics, controlling over 80% of global PV manufacturing capacity (IEA, 2024a). Carbon pricing instruments expanded to cover 28% of global emissions in 2025, generating more than US$100 billion in revenues (World Bank, 2025). These developments show that green technologies are not only reducing emissions but also reshaping comparative advantage, redirecting foreign direct investment, and embedding environmental standards into trade flows. However, financing gaps and standards divergence remain challenges for equitable global diffusion.