Sustainable Energy Usage for Africa: The Role of Foreign Direct Investment in Green Growth Practices to Mitigate CO 2 Emissions

In line with Africa’s commitment to keeping up with the United Nations Framework Convention on Climate Change, achieving a sustainable future requires balancing economic growth with environmental sustainability. This study investigates the long-term impacts of foreign direct investment, economic growth, agricultural production, and energy consumption on CO 2 emissions across 43 African nations from 1990 to 2021. Despite significant research on the individual effects of these factors, the combined influence on CO 2 emissions remains underexplored. Addressing this gap, this study employs cross-sectional augmented distributed lag estimators (CS-DL and AMG) and updated estimation packages to effectively examine the relationships between variables. Our findings are as follows: firstly, economic growth and energy use was shown to have a significant positive influence on CO 2 in the long term. Also, foreign direct investment significantly promotes CO 2 emissions. Secondly, the causality test shows a unidirectional causal relationship between CO 2 emissions and foreign direct investment. The test also revealed a bidirectional relationship between GDP and CO 2 emissions, as well as between energy consumption and CO 2 emissions. Again, a bidirectional causation was observed between agricultural production and CO 2 emissions. Thirdly, the impulse response analysis shows that GDP will contribute more to emissions over the 10-year forecast period. This study also proposes policy implications to lessen CO 2 across the continent and advocates for the judicious adoption of existing policy frameworks like the 2030 Agenda for environmental Sustainability.