The Impact of International Trade on Sustainable Development in Saudi Arabia

Mounir Belloumi and Atef Alshehry
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Mounir Belloumi: College of Administrative Sciences, Najran University, Najran 1988, Saudi Arabia
Atef Alshehry: College of Administrative Sciences, Najran University, Najran 1988, Saudi Arabia

Sustainability, 2020, vol. 12, issue 13, 1-18

Abstract: This study examines the impact trade openness has on sustainable development in Saudi Arabia. It does so by employing the autoregressive distributed lag cointegration framework, using annual data over the period 1971 to 2016. Overall, the findings suggest the existence of a long-term relationship between trade openness and two indicators of sustainable development—are economic growth and environmental quality. Results indicate that trade openness does not affect both indicators of economic growth and environmental quality in the short-term. However, in the long-term, trade openness has a significant negative impact on economic growth when it is proxied by the variables the ratio of exports plus imports to GDP, and the ratio of exports to GDP; but a significant positive impact for the variable the ratio of imports to GDP. In addition, trade openness negatively affects environmental quality in the long-term. The tests used for diagnosing models show that they are valid, and thus, our findings are robust. Comprehensively, we find that trade openness could have led to the degradation of sustainable development in Saudi Arabia for the past fourteen years.

Keywords: trade openness; economic growth; environmental quality; sustainable development; Saudi Arabia (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (14)

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Persistent link: https://EconPapers.repec.org/RePEc:gam:jsusta:v:12:y:2020:i:13:p:5421-:d:380598

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