The impact of economic and demographic factors on the environment in Africa: a case for Nigeria, South Africa and Egypt.

Abstract

The study of the relationship between environmental degradation and socio-economic factors is almost at its zenith. Contemporary evidence points to economic and population growth as the biggest contributors to ecological decay, worldwide. Much of this evidence is based on empirical studies using CO2 emissions as the proxy for environmental harm. However, carbon dioxide (CO2) emissions do not reflect the multi-facetedness of ecological degradation. Moreover, contemporary evidence has not settled the debate on the biggest environmental impact between economic and demographic factors, and what the nature of these impacts is in the long run. This study used the ecological footprint to fill these gaps, since it is a comprehensive barometer of the degradation of the natural environment. This study investigated the relationship among economic factors (Real Gross Domestic Product (RGDP), energy consumption and trade openness), demographic drivers (population density, urbanization and fertility) and environmental degradation (ecological footprint) in three populous economic giants in Africa (South Africa, Nigeria and Egypt) using panel data from World Development Indicators (WDI) and Global Footprint Network (GFN) for the period 1984 – 2022. The Pooled Mean Group – Autoregressive Distributed Lag (PMG-ARDL) approach was employed to investigate the short- and long-run dynamics. In the short run, trade openness, fertility rate and FDI were found to worsen environmental degradation, while the remaining variables were found to have insignificant impacts. In the long run, all demographic variables were found to have benign environmental impacts. Specifically, increases in fertility rates bring about environmental improvements, while increases in population density and urbanization have insignificant impacts on the environment. Conversely, all economic factors were found to degrade the environment. Energy consumption is the most significant contributor to environmental damage in the selected countries, followed by economic growth and trade openness. Fossil fuels dominate energy production in the studied countries, and the expanded use of energy to power economic activity is causing the most significant impact on the environment. It is recommended that policymakers in these three countries should consider transitioning to renewable and cleaner energy sources like solar power and natural gas to produce energy. However, the costs and benefits must be carefully considered.