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The Carbon Emissions Effect of China’s OFDI on Countries along the “Belt and Road”

Author

Listed:
  • Guangyu Ge

    (School of Business, Jiangsu Second Normal University, Nanjing 211200, China)

  • Yu Tang

    (Allbright Law Offices (Nanjing), Nanjing 210019, China)

  • Qian Zhang

    (Business School, Nanjing Xiaozhuang University, Nanjing 211171, China)

  • Zhijiang Li

    (School of Management Science and Engineering, Nanjing University of Information Science & Technology, Nanjing 210044, China)

  • Xiejun Cheng

    (School of Business, Jiangsu Second Normal University, Nanjing 211200, China)

  • Decai Tang

    (School of Management Science and Engineering, Nanjing University of Information Science & Technology, Nanjing 210044, China)

  • Valentina Boamah

    (School of Management Science and Engineering, Nanjing University of Information Science & Technology, Nanjing 210044, China)

Abstract

With the continuous practice of the “Belt and Road” initiative, the countries along the “Belt and Road” have achieved rapid social and economic development. However, environmental problems have become increasingly prominent. Around the world, there are comments that China’s “Belt and Road” initiative is a result of resource plundering, transfer of backward production capacity, and environmental degradation of countries along the line. This study quantitatively evaluated the static, dynamic, linear, and non-linear effects of China’s foreign direct investment on the carbon emissions of countries along the line. The results showed that: (1) The direct effect of China’s foreign direct investment on the carbon emissions of countries along the route was significantly negative. (2) The economic scale and industrial structure effects of China’s foreign direct investment increased the carbon emissions of countries along the route. The production technology effect suppressed the carbon emissions of countries along the route and played a leading role. (3) The estimation results of the system generalized method of moments showed that the carbon emissions of countries along the route were significantly affected by the lag period, but the impact was small. (4) The results of the threshold regressive model showed that the GDP and proportion of industrial added value had significant threshold effects on the carbon emissions effect of China’s outward foreign direct investment. When the GDP of countries along the route exceeded 7.2696, China’s outward foreign direct investment carbon emissions reduction effect could not be realized; when the proportion of the industrial added value of countries along the route was lower than 4.0106, China’s outward foreign direct investment carbon emission reduction effect could not be realized. Based on the research conclusion, we concluded that China and countries along the “Belt and Road” should strengthen cooperation on carbon emissions reduction, jointly promote low-carbon construction of industrial parks, accelerate cooperation on green energy projects, and establish a green development fund to achieve sustainable development of the countries along the “Belt and Road”.

Suggested Citation

  • Guangyu Ge & Yu Tang & Qian Zhang & Zhijiang Li & Xiejun Cheng & Decai Tang & Valentina Boamah, 2022. "The Carbon Emissions Effect of China’s OFDI on Countries along the “Belt and Road”," Sustainability, MDPI, vol. 14(20), pages 1-14, October.
    • Handle: RePEc:gam:jsusta:v:14:y:2022:i:20:p:13609-:d:948713
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