Exploring the impact of China's low carbon energy technology trade on alleviating energy poverty in Belt and Road Initiative countries

Abstract

The objective of this study is to analyze how low-carbon technology imports such as wind turbines, solar panels, carbon capture equipment, and biomass systems from China affect Belt and Road Initiative (BRI) countries’ energy poverty. Additionally, we analyze the role of financial development, deliberative democracy, economic complexity, human development, and telecommunications infrastructure on energy poverty in BRI countries. We use 69 countries from Belt and Road initiative countries and a sample period from 2000 to 2019. We classify these countries according to the IMF classification of advanced, emerging and low-income developing countries. We employ the instrumental variable generalized method of moments (IV-GMM) approach as the main technique to take care of the endogeneity concerns inherent in the model, as well as a robust quantile-based technique called the method of moments quantile regression estimator (MMQREG). Our results reveal that low-carbon technology trade from China does not significantly alleviate energy poverty in the BRI countries. Financial development increases energy poverty while deliberative democracy decreases it. Economic complexity, as well as human development, negatively affects energy poverty, while telecommunications infrastructure does not affect energy poverty significantly. Based on the results, policy implications are provided.