Impact of Chinese foreign direct investment on energy demand and stability: The Belt-Road Initiative as conditioner

We comparatively examine the impact of China's foreign direct investment (FDI) on energy demand for 29 Belt-Road Initiative (BRI) versus 25 non-BRI countries for 2000-2023. Employing partially-out LASSO linear regression and double selection LASSO linear regression, we find that FDI has a scale effect on BRI countries, while for non-BRI countries, it engenders more sustainability in production practices. Energy demand considerably escalates in the pre- and post-phase for BRI countries, with digitalization exerting no significant influence in either period. Conversely, in non-BRI countries, digitalization dampens the impact of FDI on energy demand in both the pre- and post-phase, reinforcing the sustainability effects of foreign investment.