Assessing the Effects of Economic Structural Changes and Trade Openness on Ecological Sustainability: The Case of the MENA Region

Articles in Press

Document Type : Original Article

Authors
Sahar Erfanian 1
Elham Mehrparvar Hosseini 2
Amir Hossein Chizari 3
Hossein Noroozi 3
Milad Aminizadeh 4
1 Business School, Huanggang Normal University, Huanggang, China.
2 Agricultural Planning, Economic and Rural Development Research Institute, Tehran, Islamic Republic of Iran.
3 Department of Agricultural Economics, Faculty of Agriculture, College of Agriculture and Natural Resources, University of Tehran, Karaj, Islamic Republic of Iran.
4 Department of Agricultural Economics, Ferdowsi University of Mashhad, Mashhad, Islamic Republic of Iran.
Abstract
Economic growth driven by unsustainable activities exerts increasing pressure on the environment, resulting in ecological degradation. While research on ecological sustainability in the MENA (Middle East and North Africa) region is expanding, the spatial effects of economic structural changes and trade openness on the ecological footprint remain underexplored. This study addresses this gap by examining whether structural transformations in the economy and trade exert significant spatial direct and spillover effects on the ecological footprint across MENA countries from 2001 to 2021. For this purpose, we used Moran’s I test and applied fixed-effect SDM model. To ensure the findings, we checked the robustness of our results across alternative spatial models and other matrices. The results showed that there is significant positive spatial dependence in ecological footprints, indicating that a country’s ecological footprint is influenced by those of its neighbors. We find economic structural changes played an important role in reducing the ecological footprints, both directly and through spillover effects. Similarly, trade openness had a significantly negative impact on the ecological footprint; however, the spillover effect was not significant. The results of robustness checks confirmed the environmental impact of structural economic changes and trade openness are robust and not driven by model-specific assumptions. These findings underscore the need for MENA governments to prioritize economic restructuring and promote the adoption of environmentally friendly technologies through strategic trade policies and reduced trade barriers.

Keywords

Subjects

1.     Abban, O.J., Rajaguru, G., and Acheampong, A.O. 2025. The spillover effect of economic institutions on the environment: A global evidence from spatial econometric analysis. J. Environ. Manage., 373: 123645.
2.     Abdulmagid Basheer Agila, T., Khalifa, W.M., Saint Akadiri, S., Adebayo, T.S., and Altuntaş, M. 2022. Determinants of load capacity factor in South Korea: does structural change matter?. Environ. Sci. Pollut. Res., 29(46): 69932-69948.‏
3.     Aghasafari, H., Aminizadeh, M., Karbasi, A., and Calisti, R. 2021. CO2 emissions, export and foreign direct investment: Empirical evidence from Middle East and North Africa Region. The J. Int. Trade Econ. Dev., 30(7): 1054-1076.
4.     Ahmad, N., Du, L., Lu, J., Wang, J., Li, H.Z., and Hashmi, M.Z. 2017. Modelling the CO2 emissions and economic growth in Croatia: Is there any environmental Kuznets curve? Energy, 123: 164-172.
5.     Ahmed, E.M., Elfaki, K.E., and Bashir, M.S. 2025. How investment and technological innovation interact with resource rents to affect environmental sustainability in MENA countries?. J. Environ. Manage., 391: 126566.
6.     Akpan, U., and Kama, U. 2024. Does institutional quality really matter for environmental quality?. Energy & Environment, 35(8): 4361-4385.
7.     Algeri, C., Anselin, L., Forgione, A.F., and Migliardo, C. 2022. Spatial dependence in the technical efficiency of local banks. Pap. Reg. Sci., 101(3): 685-717.
8.     Ali, Z., Anwar, M., Choo, A. L. I., and Hayat, M. 2024. Mapping the composite institutional dynamics risks and spatial spillover effects on environmental sustainability in 28 Asian economies. Sustain. Futures, 8: 100373.
9.     Al-Mulali, U., and Ozturk, I. 2015. The effect of energy consumption, urbanization, trade openness, industrial output, and the political stability on the environmental degradation in the MENA (Middle East and North African) region. Energy, 84: 382-389.
10. Alofaysan, H. 2024. The Effect of Environmental Smart Technology and Renewable Energy on Carbon Footprint: A Sustainability Perspective from the MENA Region. Energies, 17(11): 2624.
11. Aminizadeh, M., Mohammadi, H., and Karbasi, A. 2024. Determinants of fishing grounds footprint: Evidence from dynamic spatial Durbin model. Mar. Pollut. Bull., 202: 116364.
12. Banik, M., and Uddin, M.K. 2025. Environmental degradation and human rights challenges for coastal populations in Bangladesh. Discov. glob. soc., 3(1): 1-22.
13. Belotti, F., Hughes, G., and Mortari, A.P. 2017. Spatial panel-data models using Stata. Stata J., 17(1): 139-180.
14. Bilgili, F., Soykan, E., Dumrul, C., Awan, A., Önderol, S., and Khan, K. (2023). Disaggregating the impact of natural resource rents on environmental sustainability in the MENA region: a quantile regression analysis. Resour. Policy, 85: 103825.
15. Danish, U.R., and Khan, S.U.D. 2020. Determinants of the ecological footprint: Role of renewable energy, natural resources, and urbanization. Sustain. Cities Soc., 54: 101996.
16. Destek, M.A. 2021. Deindustrialization, reindustrialization and environmental degradation: Evidence from ecological footprint of Turkey. J. Clean. Prod., 296: 126612.
17. Doğan, B., Trabelsi, N., Tiwari, A.K., and Ghosh, S. 2023. Dynamic dependence and causality between crude oil, green bonds, commodities, geopolitical risks, and policy uncertainty. Q. Rev. Econ. Finance, 89: 36-62.
18. Durmaz, N., and Thompson, A. 2024. An Environmental Kuznets Curve for water pollution: Does water abundance affect the turning point?. Sci. Total Environ., 913: 169657.
19. El Khoury, R., Min Du, A., Nasrallah, N., Marashdeh, H., and Atayah, O.F. 2025. Towards sustainability: Examining financial, economic, and societal determinants of environmental degradation. Res. Int. Bus. Finance, 73: 102557.
20. Elhorst, J.P. 2014. Spatial econometrics: from cross-sectional data to spatial panels (Vol. 479). Springer.
21. Fan, Z., Cui, J., and Wu, W. 2025. Spatial spillover effect of green credit on carbon emission intensity in China: The role of high-quality productive forces. Econ. Model, 107352.
22. Global Footprint Network. 2024. https://data.footprintnetwork.org
23. Greene, W.H. 2003. Econometric analysis. Pearson education india.
24. Guliyev, H. 2024. Ecological footprint spillover effects in Europe: New insights from dynamic spatial panel data model with common shocks. J. Environ. Manage, 368: 122194.
25. Hachaichi, M., and Baouni, T. 2020. Downscaling the planetary boundaries (Pbs) framework to city scale-level: De-risking MENA region’s environment future. Environ. Sustain. Indic., 5: 100023.
26. Jabeen, G., Ahmad, M., and Zhang, Q. 2023. Combined role of economic openness, financial deepening, biological capacity, and human capital in achieving ecological sustainability. Ecol. Inform., 73: 101932.
27. Juodis, A., and Reese, S. 2022. The incidental parameters problem in testing for remaining cross-section correlation. J. Bus. Econ. Stat., 40(3): 1191-1203.
28. Kassouri, Y., and Altıntaş, H. 2020. Human well-being versus ecological footprint in MENA countries: A trade-off? J Environ. Manage., 263: 110405.
29. Keck, F., Peller, T., Alther, R., Barouillet, C., Blackman, R., Capo, E., ... and Altermatt, F. 2025. The global human impact on biodiversity. Nature, 641: 395-400.
30. Khalfaoui, R., Arminen, H., Doğan, B., and Ghosh, S. 2023. Environment-growth nexus and corruption in the MENA region: Novel evidence based on method of moments quantile estimations. J. Environ. Manage., 342: 118146.
31. Khan, M., and Khan, I. 2024. Achieving environmental sustainability through technological innovation, good governance and financial development: perspectives from low-income countries. Sustain. Futures, 8: 100392.
32. LeSage, J., and Pace, R.K. 2009. Introduction to spatial econometrics. Chapman and Hall/CRC.
33. Li, R., Wang, Q., Li, L., and Hu, S. 2023. Do natural resource rent and corruption governance reshape the environmental Kuznets curve for ecological footprint? Evidence from 158 countries. Resour. Policy, 85: 103890.
34. Li, R., Wang, Q., Liu, Y., and Jiang, R. 2021. Per-capita carbon emissions in 147 countries: The effect of economic, energy, social, and trade structural changes. Sustain. Prod. Consump., 27: 1149-1164.
35. Li, S., Jia, S., Liu, Y., and Li, R. 2024. The degree of population aging and carbon emissions: Analysis of mediation effect and multi-scenario simulation. J. Environ. Manage., 367: 121982.
36. Liu, Y., Sadiq, F., Ali, W., and Kumail, T. 2022. Does tourism development, energy consumption, trade openness and economic growth matters for ecological footprint: Testing the Environmental Kuznets Curve and pollution haven hypothesis for Pakistan. Energy, 245: 123208.
37. Mi, Z.F., Pan, S.Y., Yu, H., and Wei, Y.M. 2015. Potential impacts of industrial structure on energy consumption and CO2 emission: a case study of Beijing. J. Clean. Prod., 103: 455-462.
38. Mrabet, Z., Alsamara, M., Mimouni, K., and Mnasri, A. 2021. Can human development and political stability improve environmental quality? New evidence from the MENA region. Econ. Model., 94: 28-44.
39. Nathaniel, S., Anyanwu, O., and Shah, M. 2020. Renewable energy, urbanization, and ecological footprint in the Middle East and North Africa region. Environ. Sci. Pollut. Res., 27(13): 14601-14613.
40. Opoku-Mensah, E., Chun, W., Tuffour, P., Chen, W., and Agyapong, R.A. 2023. Leveraging on structural change and ISO 14001 certification to mitigate ecological footprint in Shanghai cooperation organization nations. J. Clean. Prod., 414: 137542.
41. Pesaran, M.H. 2004. General diagnostic tests for cross-sectional dependence in panels. University of Cambridge, Cambridge Working Papers in Economics, 435.
42. Pesaran, M.H., and Xie, Y. 2021. A bias-corrected CD test for error cross-sectional dependence in panel data models with latent factors. arXiv preprint arXiv:2109.00408.
43. Ragmoun, W. 2023. Ecological footprint, natural resource rent, and industrial production in MENA region: Empirical evidence using the SDM model. Heliyon, 9(9): e20060.
44. Ramezani, M., Abolhassani, L., Shahnoushi Foroushani, N., Burgess, D., and Aminizadeh, M. 2022. Ecological Footprint and Its Determinants in MENA Countries: A Spatial Econometric Approach. Sustainability, 14(18): 11708.
45. Razzaq, A., Shahbaz, P., ul Haq, S., Zhou, Y., Erfanian, S., and Abbas, A. 2024. Assessment of the heterogeneous impacts of global value chain participation on Sustainable economic growth and environmental quality. Heliyon, 10(15): e35348.
46. Saba, C.S., Alola, A.A., and Ngepah, N. 2025. Exploring the role of governance and institutional indicators in environmental degradation across global regions. Environ. Dev., 54: 101152.
47. Saghaian, S., Aghasafari, H., Aminizadeh, M., and Riahi, A. 2020. Factors Influencing Climate-Smart Goods Trade in Some Developing Countries in the Middle East and North Africa Region: An Application of the Spatial Panel Model. Int. Trade J., 34(3): 281-296.
48. Saud, S., Haseeb, A., Zafar, M.W., and Li, H. 2023. Articulating natural resource abundance, economic complexity, education and environmental sustainability in MENA countries: Evidence from advanced panel estimation. Resour. Policy, 80: 103261.
49. Schneiter, P., and Mellon-Bedi, S. 2025. The Environmental Kuznets Curve Revisited: A Spatial Panel Model with Heterogeneous Coefficients. Energy Econ., 143: 108237.‏
50. Stiewe, C., Xu, A. L., Eicke, A., and Hirth, L. 2025. Cross-border cannibalization: Spillover effects of wind and solar energy on interconnected European electricity markets. Energy Econ., 143: 108251.
51. Sun, Y., Li, H., Andlib, Z., and Genie, M.G. 2022. How do renewable energy and urbanization cause carbon emissions? Evidence from advanced panel estimation techniques. Renew. Energy, 185: 996-1005.
52. Sunge, R., and Espoir, D.K. 2026. Analyzing the environmental impact of agricultural production in Africa through a comprehensive spatial econometric framework. Environ. Impact Assess. Rev., 117: 108183.
53. Telila, Z., Amare, A., and Tolera, T. 2025. Evaluating forest cover change and its impact on ecosystem services in Gargeda state forest western Ethiopia. Sci. Rep., 15(1): 34795.
54. Touati, K., and Ben-Salha, O. 2024. Are Natural Resources Harmful to the Ecology? Fresh Insights from Middle East and North African Resource-Abundant Countries. Sustainability, 16(11): 4435.
55. Wang, Q., Liu, T., and Li, R. 2025a. Artificial Intelligence and Environmental Sustainability: Investigating the AI‐EKC Nexus for SDG 7 and SDG 13. Sustain. Dev.,
56. Wang, Q., Qi, Y., and Li, R. 2025b. Artificial Intelligence and Corporate Sustainability: Shaping the Future of ESG in the Age of Industry 5.0. Sustain. Dev.,
57. Wang, Q., Wang, X., and Li, R. 2025c. Rethinking Sustainability: Human Development and Ecological Footprint Under Deglobalization Pressures. Sustain. Dev.,
58. Wang, Q., Zhang, S., and Li, R. 2026. Artificial intelligence in the renewable energy transition: The critical role of financial development. Renew. Sustain. Energy Rev., 226: 116280.
59. Wooldridge, J.M. 2010. Econometric Analysis of Cross Section and Panel Data (2nd ed.). MIT Press.
60. World Bank. 2024. World development indicators. https://databank.worldbank.org/source/world-development-indicators
61. Zambrano-Monserrate, M.A., Ruano, M.A., Ormeño-Candelario, V., and Sanchez-Loor, D.A. 2020. Global ecological footprint and spatial dependence between countries. J. Environ. Manage., 272: 111069.
62. Zhang, F., Li, R., and Wang, Q. 2025. How Does AI Technology Innovation Drive Carbon Emission Efficiency? A Machine Learning–Based Meta‐Frontier Analysis Across 75 Countries. Sustain. Dev.,
63. Zhou, X., Xie, F., Li, H., Zheng, C., and Zhao, X. 2024. Understanding inter-term fossil energy consumption pathways in China based on sustainable development goals. Geosci. Front., 15(3): 101687.
Journal of Agricultural Science and Technology

Articles in Press, Accepted Manuscript
Available Online from 15 December 2025