Asymmetric effects of energy consumption and trade openness on CO2 emissions within the Environmental Kuznets Curve framework in Somalia

This study investigates the asymmetric effects of energy consumption and trade openness on carbon dioxide (CO 2 ) emissions in Somalia within the Environmental Kuznets Curve (EKC) framework using the Nonlinear Autoregressive Distributed Lag (NARDL) model. Augmented Dickey–Fuller (ADF) and Phillips–Perron (PP) unit root tests confirm a mixed order of integration, while the bounds test verifies the existence of a stable long-run cointegration relationship among the variables. The findings reveal significant asymmetric effects of both energy consumption and trade openness on CO 2 emissions. Positive shocks to energy consumption exert substantially larger effects on environmental degradation than negative shocks, reflecting Somalia’s dependence on fossil-fuel-based energy systems and low energy efficiency. In contrast, positive shocks to trade openness reduce emissions, whereas negative shocks increase environmental degradation, suggesting that trade integration improves Environmental degradation through technology diffusion and efficiency gains. The results provide weak empirical support for the EKC hypothesis, indicating that income growth alone does not adequately explain environmental outcomes in Somalia. Wald, diagnostic, and stability tests confirm significant asymmetry and model robustness. The study concludes that environmental degradation in Somalia is primarily driven by asymmetric energy and trade dynamics rather than income effects. The findings highlight the importance of renewable energy transition, sustainable trade integration, and structural economic transformation for environmental sustainability.