Impact of regional trade integration and energy transition on natural resources footprints in Asian Countries

Abstract

With the right policies and investments, regional trade integration and energy transition can offer a unique opportunity for economic development and environmental sustainability in Asian countries. Therefore, exploring the determinants of resource sustainability from unique perspectives is crucial. Hence, this study explores the role of regional trade integration, energy transition, and financial development on trade-adjusted resource footprints in selected Asian countries from 1990 to 2021 using Cross-Sectional Augmented Distributed Lag (CS-ARDL) estimation strategy. The preliminary findings expose that cross-sections are heterogenous and the variables are cointegrated. The long-run estimates reveal that improvement in regional trade integration (across borders), and renewable energy transition reduce resource footprints. At the same time, economic growth, financial development, and industrialization contribute to higher resource consumption in the region. These findings are consistent across alternative estimators and recommend relevant policies.