Interlinking dynamics of natural resources, financial development, industrialization, and energy intensity: Implications for natural resources policy in emerging seven countries

The study examines the intricate relationship between energy poverty, natural resources rents, energy intensity, financial development, and industrialization, with CO2 emissions in the E-7 countries from 1996 to 2021. This study utilizes a nonparametric econometric approach known as the method of moments quantile regression. The findings highlight significant associations among these variables. Higher energy poverty levels are linked to increased CO2 emissions, indicating a correlation between energy poverty and carbon emissions. Likewise, higher energy intensity, reflecting lower energy efficiency, contributes to greater carbon emissions. Furthermore, reliance on natural resources for economic development is positively associated with CO2 emissions, suggesting potential environmental deterioration. The financial development shows a positive association with CO2 emissions, suggesting that increased financial resources may lead to higher carbon emissions. However, this relationship diminishes at higher levels of financial development, indicating a potential decoupling of financial progress from carbon emissions. Industrialization and natural resources display a positive relationship with CO2 emissions, highlighting the contribution of industrialization to carbon emissions. Policymakers are urged to prioritize energy efficiency promotion, facilitate the transition to renewable energy sources, and encourage sustainable industrial practices. Integrating innovation activities that prioritize green technologies and sustainable development can effectively reduce CO2 emissions while supporting economic growth. These findings hold crucial implications for policymakers in the E-7 countries, emphasizing the need for sustainable development and environmental stewardship. Striking a balance between economic growth and environmental preservation is essential for a sustainable future in the E-7 countries.