The effects of urbanization, ICT, fertilizer usage, and foreign direct investment on carbon dioxide emissions in Ghana.

Abstract

Rising levels of carbon dioxide emissions in emerging countries has become a concern to all and there are calls for urgent action to curtail this. Ghana's government has in recent times sought to achieve higher economic growth at a lower carbon emission rate. With the current development of the country, this study analyzed the effect of urbanization, fertilizer usage, foreign direct investment (FDI), and ICT development on carbon dioxide emissions in Ghana. Time series data for 1971-2018 period was analyzed using autoregressive distributed lag regression approach within the environmental Kuznets curve (EKC) framework. From regression analysis, while the EKC hypothesis was not validated for aggregate carbon emissions, it was found that urbanization has a negative and significant impact on aggregate carbon emissions, whereas FDI and ICT infrastructure have positive impacts on the same in the both long run and short run. Fertilizer usage is seen to interact with urbanization to reduce carbon emissions at the aggregate and sectoral levels. It was found that although ICT helps reduce emissions at some sectoral levels, it was not enough to lower emissions at the aggregate level. Among other things, it is important for Ghana to take a critical assessment of its FDI sources and engagements to ensure that it does not become a sink for high toxic-emitting industries. Intensive education on efficient usage of fertilizer is also needed. It is important for policymakers to critically assess ways and means by which ICT development can be deployed to reduce overall carbon dioxide emissions in the country.