Environmental impacts of trade liberalization : the case of Egypt

Abstract EN

With rising globalization and advances in technology, the impact of trade on environment has increasingly become a vital issue across the world.

This paper contributes to this discussion by evaluating the environmental impacts of trade liberalization in Egypt using time series data over the period of 1980-2007.

In this context, counteraction analysis is utilized to examine the long-run relationship among the variables, as well as a vector error correction model to determine the short-run dynamics of the system.

Results confirm the theoretical concept of the absence of a one-way relationship between trade and environment.

For both air and land pollution, the result is rather ambiguous.

There are two opposing forces affecting environmental quality in the long run.

The ultimate trade effect on environment would be highly dependent on environmental regulations and their enforcement.