How to balance China's sustainable development goals through industrial restructuring: a multi-regional input-output optimization of the employment-energy-water-emissions nexus

Abstract

To effectively manage economic transition and pursue sustainable development, the Chinese government has promulgated a series of policies in the 13th Five Year (2016-2020) Plan (FYP), covering social security, economic growth, energy transition, resource conservation, and environmental protection. To balance the various 13th FYP policy targets, we propose a multi-objective optimization model based on multi-regional input-output analysis. The model integrates the management of employment, energy consumption, water use, carbon emissions, and pollutant emissions by determining a policy-dominated industrial restructuring pathway that would best achieve consistency in sustainable development policies, adaptation to the national industrial development trend, and regional equity among China's provinces. Synergies and trade-offs among various policies are also discussed. Our optimization results show that an energy-consumption-dominated industrial restructuring pathway is the best solution, as it would satisfy various sustainable targets, facilitate (restrain) development of high-value-added (high-energy-consumption and high-emissions) sectors, as well as improve regional equity. Therefore, to realize sustainability, the energy policy should be prioritized when formulating an industrial restructuring pathway. Applying such a multi-objective optimization model provides policymakers with a comprehensive approach to support sustainable development policies.