SIGNIFICANCE OF ECONOMIC ACTIVITIES IN ENVIRONMENTAL PROTECTION: EVIDENCE FROM A PANEL OF 4-ASEAN ECONOMIES

Hastin Umi Anisah,Ade Gunawan,Satria Tirtayasa,A. Akrim,Emilda Sulasmi

doi:10.32479/ijeep.10831

Abstract

Environmental degradation is increasing gradually due to economic activities by the Association of Southeast Asian Nations (ASEAN). ASEAN energy center estimated 4.4 percent increase in the consumption of final energy among ASEAN nations in 2030 which is greater than the average growth rate of 1.44%. The current study empirically analyzes the impact of economic activities on environmental protection across four largest ASEAN economies (Indonesia, Thailand, Singapore and Malaysia) over a period of 1998-2018. In order to achieve this objective, the study employs several panel econometric tests; ADF, panel cross-sectional dependence, Johansen-Fisher panel cointegration, FMOLS and country specific long run output method.” The study finds significant positive impact of non-renewable energy consumption (NRNC), GDP and labor force on CO2 emission. Renewable energy consumption (RNC) has negative impact on CO2 emission. As RNC causes reducing CO2 emission in the sample ASEAN economies, the study suggests the policy makers to inductee effective policies to encourage the generation of renewable energy and its uses across ASEAN economies. While the generation of non-renewable energy should be discouraged as it promotes CO2 emission.Keywords: Economic Activities, Energy Consumption, GDP, ASEAN, FMOLS.JEL Classifications: R11, K32DOI: https://doi.org/10.32479/ijeep.10831

Highlights

Many researchers in the current era consider environment as a main area of interest in Association of Southeast Asian Nations (ASEAN) economies
ASEAN energy center estimated 4.4% increase in the consumption of final energy among ASEAN nations in 2030 which is greater than the average growth rate of 1.44%
The findings show that there exists a significant long run association among CO2 emissions (COE), market price of GDP (MGDP), Renewable energy consumption (RNC), non-renewable energy consumption (NRNC), gross fixed capital formation (GFCF), labor force (LBR), remittances received (RR), PV, foreign direct investment (FDI) and PP in a panel of four ASEA nations

Summary

Introduction

Many researchers in the current era consider environment as a main area of interest in ASEAN economies. The current level of CO2 omission (COE) in ASEAN nations are relatively small as compare to US and China, but in 50 years ahead, ASEAN state is foreseen to be most pretentious by the increment of COE. This might be suitable for the government of the ASEAN nations to generate electricity through most appropriate and beneficial sources that have less contributions in increasing COE as different apparatuses and machines that are used in the EC process, are omitting CO2 that adversely affects environmental quality.

Methods

Results

Conclusion