The impact of economic crises on carbon emissions in Egypt during the period (1972-2021)

Naji Al-Baghdadli, Noha; Muhammad, Abdul Khaleq; Magdy Abdel Halim, Ahmed; Al-Shazly, Alaa; Reda Al-Najjar, Omnia

doi:10.21608/esalexu.2023.306431

The impact of economic crises on carbon emissions in Egypt during the period (1972-2021)

Document Type : Original Article

Authors

¹ Economics teacher at the College of Economic Studies and Political Sciences, economics researcher at the Center for Economic Research and Studies

² Assistant lecturer in economics at the College of Economic Studies and Political Sciences, economics researcher at the Center for Economic Research and Studies

³ Teaching assistant in the Department of Economics at the Faculty of Economic Studies and Political Sciences, economics researcher at the Center for Economic Research and Studies

⁴ Economics researcher at the Center for Economic Research and Studies

10.21608/esalexu.2023.306431

Abstract

Since the 1970s, the world has experienced many economic crises due to financial crises, wars, and pandemics, such as the oil embargo crisis, the global financial crisis, the Russian-Ukrainian war, and COVID-19. These crises coincide with worsening the climate change problem. This study aims to analyze the direct and indirect effects of the economic crises on CO₂ emissions through the effect of these crises on the prices and the consumption of fossil fuels and on renewable energy production. We also examine the impact of some crises that occurred in the Egyptian economy, namely the 1973 oil embargo crisis, the global financial crisis of 2008, and the political instability in 2011, on Egypt's CO2 emissions. The paper uses the autoregressive distributed lag (ARDL) cointegration model. Our results conclude that the effect of an economic crisis on carbon emissions depends on the nature and cause of the crisis. Our results show that the 1973 oil embargo crisis, which was followed by a significant rise in oil prices, had a negative impact on Egypt's emissions during the crisis period, while Egypt's period of political instability (2011-2014) caused an increase in emissions, whereas the effect of the global financial crisis on emissions in Egypt was insignificant. In both the short and the long run, the results showed that fossil fuel consumption and economic growth have a positive impact on CO₂ emissions, whereas renewable energy production and oil prices have a negative impact on CO₂ emissions in Egypt.

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