The main goal of this study is to investigate the impact of aggregated and disaggregated natural resource rents on ecological sustainability from 1992 to 2020 in African countries by using panel data methods.
In this regard, decision-makers of African countries may consider harmonizing the welfare and environmental impacts of natural resources.
The global economy has witnessed one of the most challenging issues since the 1970s because of the environmental consequences of unprecedented greenhouse gas emissions (GHGs) concentration.
In particular, the global carbon emission (CO2) levels, which have the highest share in total GHG emission levels have sharply inclined.
The use of fossil resources sharply climbed after the 18th century, and the main reason for such a spike was the Industrial Revolution. CO2 level has a similar pace with fossil resource use trend as well, and annual CO2 level has begun to incline at the beginning of the 20th century.
Besides, it can be asserted that historical fluctuations in CO2 levels and fossil resource use are highly correlated.
Particularly, the use of fossil energy sources has exacerbated climate change. Therefore, combating climate change has centered at the heart of global discussions. Within this regard, a series of international initiatives have been established to halt global warming.
Stockholm Conference in 1972 was the first international action on climate topic, and the Brundtland Report, Rio Conference, and Kyoto Treaty followed the Stockholm initiative.
The Millennium Development Goals (MDGs), announced in September 2000, has been another international initiative strongly emphasizing the significance of environmental sustainability; in fact, the seventh goal was completely devoted to enhancing ecological sustainability.
Within this scope, the announcement of Sustainable Development Goals (SDGs) at the Conference of UN Sustainable Development in 2012 has been a historical milestone for reducing negative externalities of economic activities.
In this regard, 17 SDGs have been announced, and seven of 17 SDGs are either directly or indirectly related to ensuring environmental sustainability. Particularly SDGs-13 is completely related to the prevention of climate change.
Thus, environmental sustainability has become a crucial agenda at the global level, and prevention of resource depletion and GHGs abatement are among the significant topics in SDGs (UN, 2023).
Moreover, natural resource reliance on boosting economic development can be harmful to the economic development itself.
On the other hand, natural resources in a country not only promote industrialization and economic development of the region but also enable it to meet international natural resource demand for economic activities.
Therefore, natural resources could have a vital role in ensuring global welfare, and they could be a source of prosperity and welfare for a nation. Thus, shifting traditional technologies from advanced and cleaner ones could be possible by establishing green funds through natural resource revenues.
Moreover, abundant natural resources can help to boost the economic performance of a country that helps to climb the economic development ladder; which in turn, undesired results of economic development on the environment can be internalized as envisaged in the Environmental Kuznets Curve (EKC) hypothesis.
However, there are some contrasting opinions about the thump of natural resources on development based on the hypothesis of “Resource Curse”.
Africa is a region with plentiful natural resources ranging from oil, natural gas, water sources, arable lands, forests, and minerals. In this regard, African countries hold 30% of global mineral reserves, 12% of global oil reserves, 65% of the world’s arable land reserves, 8% of the world’s natural gas reserves, and 10% of global renewable freshwater sources. Besides, the African region has a significant proportion of precious metals such as chromium, gold, cobalt, and platinum (UN Environmental Programme, 2023a).
Therefore, natural resources have profoundly impacted the economic and ecological performance of the region. The economic exercises based on natural resources ranging from extraction to export are among the most crucial determinants of economic development. In this regard, most African countries ensure an average of 40% of their welfare level from economic activities based on natural capital (UN Environmental Programme, 2023b).
Despite, being a fuel for economic prosperity in Africa, vast natural resource utilization can have environmental consequences. African Development Bank (2016) emphasized that economic and environmental trade-off associated with natural resources is prevalent in African countries, and natural resource abundance cannot be maintained in the region unless the balance is ensured between supply and demand for resources.
Moreover, Africa is the region with the fastest-growing GHGs level and environmental challenges, and these rising environmental problems are closely associated with natural resources.
A Guest Editorial