The impact of green finance, economic growth and energy usage on CO2 emission in Vietnam – a multivariate time series analysis

Abstract

Purpose: This study aims to examine the relationship between green finance, economic growth, renewable energy consumption (energy efficiency), energy import and CO2 emission in Vietnam using multivariate time series analysis. Design/methodology/approach: The data were collected from 1986 to 2018 since Vietnam initiated the economic reforms, namely “Doi Moi” in 1986. The concept and methods of cointegration, Granger causality and error correction model (ECM) were employed to establish the relationship between the variables of interest. Findings: Our results confirmed the existence of cointegration among the variables. The Granger causality test revealed unidirectional causality running from renewable energy consumption to CO2 emission and green investment to CO2 emission. Originality/value: This study results confirm the existence of cointegration among the variables. The results of the study imply that policies on economic development impose a significant impact on pollution in Vietnam. This study has described Vietnam, its economic development, green manufacturing practices, its environmental health and level of carbon dioxide emission which was enhanced due to COVID-19.