Financial development and CO2 discharge in Nigeria

This study examined the effect of financial development, fossil energy use, economic progress, and FDI on environmental pollution in Nigeria from 1981 – 2014 using the ARDL technique. The outcome of the bond test reveals the presence of a long-run association on the variables of the model. The short-run estimate shows that all the variables positively influence CO2. The result of the long-run analysis further indicates that financial progress, fossil fuel, and GDP accelerates the level of CO2 discharge. However, FDI does not explain environmental pollution in Nigeria. Hence, the study suggests that government and policymakers should formulate policies to improve financial development designed to mitigate CO2 discharge by giving directives to financial institutions that all credits allocation should be toward the purchase of low emission technologies and domestic appliances. In addition, environmentalists should enlighten citizens on the danger of environmental pollution and ways to reduce it through public lectures and seminars.