Environmental Implication of BELT and Road Imitative (BRI) on Developing Countries Along with Silk-Road
China has proposed the Belt and Road Initiative to promote the cooperation of energy production and trade between the relevant countries. This paper investigates the relationship between the energy consumption and economic growth of the countries along the Belt and Road using a panel of data for 69 countries during the period between 1980 and 2014. Both of the renewable and traditional fossil energy consumptions are investigated in this study. By employing Vector Error Correction Model (VECM), Fully Modified Ordinary Least Squares (FMOLS) and dynamic Ordinary Least Squares regression (DOLS) approaches, the estimation results indicate that the nexuses of the energy consumption and economic developments vary across different subgroups. For the entire group, there is evidence of long−run bidirectional causalities among carbon emissions, energy use, industry value added and GDP per capita. For the energy −importing countries along the Belt and Road, there exists unidirectional short−run causality running from GDP to renewable energy and long−run causality in the reverse direction. In contrast, for the energy−exporting countries, there is a bidirectional causality between the energy use and GDP per capita in the long run. These findings suggest significant cooperation potential in the economies and trades of China and the Belt and Road countries.
Keyword - Environment, Economic Development, Belt Road Imitative (BRI)