Effect of Africa Openness of Goods and Services Markets to Pollution Concentrations: Empirical Evidence from Rwanda.

Abstract

The present paper attempted to examine the impact of Africa continental free trade vis-à-vis to Rwanda environments quality. Theoretical model was developed to divide influence of unrestricted trade on pollution measure or scale, methods, and composition effects. Afterwards, the theory was examined employing carbon dioxide (CO₂) concentration and emission. The model was estimated by panel data approach, the data used were extracted from World Bank datasets. The time period covered in analysis is 1990-2017 across 34 selected African countries, and East Africa block (Rwanda, Uganda, Tanzania, and Kenya). The results brought into being that continental free trade creates fairly small fluctuations in pollution concentrations as it amends the composition of national productivity. The estimate demonstrate that an increase of scale effect measured by GDP per capita by 1 unit resulted from the continental free trade would lower about 0.30578% metric tons per capita of CO₂ emission. In addition, if the continental free trade raises trade intensity by one unit, CO₂ emission would be lowered by 0.24%. Further, if the continental free trade raises gross national income per capita purchasing power parity by 1%, carbon dioxide would be upstretched about 86.54%. It is astonishing that Africa continental free trade seems to be a friend of the environment. Africa free trade definitely will raise people’s welfare if proper environmental policies are in place.