Foreign direct investment, technology transfer and carbon emissions in MENA countries: economic drivers and environmental consequences (1990-2022)

Objective: This study examines the impact of foreign direct investment (FDI) and technology transfer on environmental degradation in the MENA region from 1990 to 2022. It aims to determine whether FDI and technology transfer have positive or negative effects on the environment. Design of the methodology: The study uses the ARDL model to estimate how the variables evolve and interact over time. Results: The analysis reveals a long-run positive relationship between FDI, technology transfer, CO2 emissions, economic growth and energy consumption. Trade liberalisation, however, is associated with reduced emissions. The ECT indicates a gradual return to balance. In the short run, energy consumption and economic development are the primary drivers of emissions. Practical implications: Limitations include data availability, measurement errors, variations by region and the impact of short-duration fluctuations. Decision-makers ought to promote sustainable practices, regulate FDI in polluting sectors and encourage knowledge transfer within these companies. This study presents a new perspective on the interplay between environmental performance, technology transfer and FDI in the MENA region.