Quantifying future carbon emissions uncertainties under stochastic modeling and Monte Carlo simulation: Insights for environmental policy consideration for the Belt and Road Initiative Region

Abstract

This study critically examines future carbon (CO2) emissions in the Belt & Road Initiative (BRI) region, considering factors such as energy consumption, economic growth, population growth, and population density. The objective of this study is to identify critical areas of higher emissions, which require policy intervention capable of strengthening sustainability in the BRI compact. A combined approach of stochastic modeling and Monte Carlo simulations was employed, utilizing panel data from 45 countries in the BRI region from 1990 to 2021. Results confirm that emissions are higher in all scenarios in direct proportion to electric power consumption, population growth, and Gross Domestic Product (GDP) growth. In scenarios with high emissions, a continuous and significant upward trend in CO2 emissions was observe. The medium emissions scenario exhibited a more moderated rise in emissions, suggesting a balance between economic development and environmental considerations. Critical areas for future environmental policy-making resides in electric power consumption, population growth, and GDP growth. The study strongly recommends for a shift from the current focus on road and railway infrastructure to renewable energy infrastructure, green innovations and efficient technology transfer to member countries. Without this, the BRI region is likely to face increased emissions, posing significant challenges to future sustainable development and global environmental sustainability.