## Global Fossil Fuel Subsidies Remain Large: An Update Based on Country-Level Estimates

_IMF Working Papers, May 2, 2019_

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## Bibliographic details
- Authors: David Coady, Ian W.H. Parry, Nghia-Piotr Le, Baoping Shang
- Published: May 2, 2019
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781484393178.001

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### Methodology and scope
- Subsidies are defined as fuel consumption times the gap between existing and efficient prices (i.e., prices warranted by supply costs, environmental costs, and revenue considerations).
- Estimates cover 191 countries.
- Paper length: 39 pages; Series: Working Paper No. 2019/089; DOI: https://doi.org/10.5089/9781484393178.001.

### Key findings: magnitude and distribution
- Global subsidies in 2015: $4.7 trillion (6.3 percent of global GDP).
- Projected global subsidies in 2017: $5.2 trillion (6.5 percent of GDP).
- Largest subsidizers in 2015:
  - China: $1.4 trillion
  - United States: $649 billion
  - Russia: $551 billion
  - European Union: $289 billion
  - India: $209 billion
- About three quarters of global subsidies are due to domestic factors.
- Fuel composition: coal and petroleum together account for 85 percent of global subsidies.

### Environmental and fiscal impacts of efficient pricing
- Efficient fossil fuel pricing in 2015 would have:
  - Lowered global carbon emissions by 28 percent.
  - Lowered fossil fuel air pollution deaths by 46 percent.
  - Increased government revenue by 3.8 percent of GDP.

### Policy implications and analysis
- Energy pricing reform is largely in countries’ own national interest because about three quarters of subsidies stem from domestic factors.
- Targeting coal and petroleum would address the bulk of the subsidy problem, given their 85 percent share of global subsidies.
- Achieving efficient fossil fuel pricing delivers simultaneous environmental (large reductions in emissions and air pollution deaths) and fiscal (notable revenue gains) benefits.

*David Coady, Ian W.H. Parry, Nghia-Piotr Le, and Baoping Shang. "Global Fossil Fuel Subsidies Remain Large: An Update Based on Country-Level Estimates", May 2, 2019.*

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_Source: https://www.imf.org/en/publications/wp/issues/2019/05/02/global-fossil-fuel-subsidies-remain-large-an-update-based-on-country-level-estimates-46509_