Economic growth, combustible renewables and waste consumption and emissions in North Africa

This paper examines the causal relationship between economic growth, combustible renewables and waste consumption, and CO2 emissions for a balanced panel of five North Africa countries during the period 1971-2008. The panel cointegration test results indicate that, in the short-run, there is evidence of unidirectional causality running from CO2 emissions to real GDP, unidirectional causality from combustible renewables and waste consumption to real GDP without feedback, and unidirectional causality from combustible renewables and waste to CO2 emissions. However, there is evidence of no short-run causality between combustible renewables and waste consumption and CO2 emissions. In the long-run, we find that there is evidence of a unidirectional causality running from CO2 emissions and combustible renewables and waste consumption real GDP. The results from panel FMOLS and DOLS estimates show that CO2 emissions is the most significant variable in explaining economic growth in the region which is followed by the consumption of combustible renewables and waste. In the long-run, increases in combustible renewables and waste consumption and emissions lead to increase economic growth. The finding of this paper is that North Africa region can use renewable energy as a substitutable energy to the fossil one and avoid the disaster on atmosphere and stimulate economic growth in the long-run.