Role of economic complexity and energy sector in moving towards sustainability in the exporting economies

Abstract

The largest contributor to environmental deterioration, the carbon footprint, arises from excessive fossil fuel consumption. Meanwhile, international experts note that despite the positive dynamics in the issue of making commitments to carbon-zero targets, most companies around the globe do not have a clear plan or strategy to achieve environment-based targets. This study addresses sustainable development goals (SDGs) concerning clean energy usage, sustainability, and the environment. Hence, this study investigates the impacts of the economic complexity index (ECI), energy productivity (EPD), renewable energy electricity generation (REEG), and environment-based patents on ecological footprints (ECFP) to attain a carbon-zero environment and SDGs for forty-five exporting countries from 1990 to 2020. An extensive exploration into the connection amongst the explored variables shows that the rises in ECI, EPD, and REEG help subside ECFP in the short-term and long-term estimations. Besides, the results show a bidirectional and unidirectional causality from ECFP to REEG and EPD, respectively. The key practical policies of this work are building modernized tax systems with progressive tax policies, better tax collection, private SDGs financing with incentives regulations, promising project planning on green technologies, and accessibility of grants from global organizations and private sectors to invest in SDGs and a carbon-zero environment target.