Trade-Environment Nexus: An Empirical Examination of Sub-Saharan Africa and East Asia.

Abstract

The importance of trade to economies cannot be overemphasized, albeit the associated environmental implications. East Asia houses the largest greenhouse emitting country in the world whiles Africa’s economy is highly dependent on trade but literature in these two regions is lacking. To examine the environmental effect of trade for these two regions, this current study employed the Generalized Method of Moments on a panel of forty-seven SSA countries and seven East Asian countries for a period of 34 years. The study found trade openness to increase the emission of carbon dioxide but played no significant role in the emission of nitrous oxide and methane. On average, the study finds trade to be beneficial to the environment of SSA and East Asian countries and therefore ongoing trade liberalization should be fostered.