NIGERIA’S INDUSTRIAL DEVELOPMENT AND CARBORN EMISSIONS: AN EMPIRICAL ANALYSIS OF THE GROWTH-ENVIRONMENT TRADE-OFF FOR SUSTANABLE DEVELOPMENT (1981–2023)
Mohammed Seri and Shehu Ya’u
Volume 13 Issue 2
Abstract
This study examine the dynamic link between industrial development and carbon emissions in Nigeria spanning the period 1981-2023, addressing the essential trade-offs between economic growth and environmental sustainability. The purpose is to analyse how industrial expansion effects carbon emissions and to explore the causal relationships among important factors. The data used in this analysis includes annual time series data on carbon dioxide emissions, manufacturing value added, gross domestic product (GDP), renewable energy consumption, foreign direct investment (FDI), and total energy consumption, sourced from the Central Bank of Nigeria Statistical Bulletin (2022) and the World Bank’s World Development Indicators (2022). Employing Johansen cointegration methods, this research evaluates the long-term associations between the variables, employing Fully Modified Ordinary Least Squares (FMOLS) and Dynamic Ordinary Least Squares (DOLS) for strong long-run elasticity estimations. The findings demonstrate that although industrial expansion initially raises carbon emissions, it eventually leads to emission reductions over time, in line with the Environmental Kuznets Curve (EKC) theory. Renewable energy adoption emerges as the most important factor for cutting emissions, indicating a statistically significant negative association with carbon emissions. Furthermore, GDP has a long-term negative influence on emissions, indicating the decoupling of economic expansion from environmental deterioration. In contrast, population expansion is shown to raise emissions, whereas FDI and fossil fuel use have minor influence. This research underlines the significance of scaling up renewable energy and energy-efficient industrial techniques to align Nigeria’s industrial growth with both national and global environmental objectives. The results have major implications for policy frameworks supporting clean energy and sustainable development. Keywords: Carbon Emissions; Industrial Development; Renewable Energy
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