Examining the Impact of Foreign Direct Investment (FDI) on Offshore CO2 in the Sub-Sahara
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This study examined the relationship between Foreign Direct Investment (FDI) and the emission of CO2 in the Sub Saharan Africa. The literature focuses on foreign direct investments and C02 emission studies in various countries. Data was obtained for the World Bank database from 2004 to 2015, the general method of moment (GMM) model was used for estimating parameters with endogenous regressions in the panel data model to analyze our data. We found out that FDI has significantly influenced the emission of CO2 in the Sub Saharan Africa. The results demonstrated the heterogeneity of the effects of foreign direct investment on CO2 emissions, the impact of foreign direct investment on CO2 emissions is negative and significant. However, the general environmental impact of foreign direct investment is determined by indirect effects and appears to be positive. Moreover, natural resources endowment seemed not to play a key role in this relationship. Recommendations were given to ensure the usage of renewable energy by ensuring a sustainable economic growth.
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