The role of climate finance and global value chains in achieving ecological sustainability: An empirical evidence in developing countries towards COP29

Abstract

This study explores the role of Climate Finance and Global Value Chains in driving Ecological Sustainability across 117 oil-exporting developing countries from 2013 to 2022. Utilizing advanced econometric techniques, including System GMM, Fixed Effects Models (FEM), and Feasible Generalized Least Squares (FGLS), the research evaluates ES through key indicators such as the Ecological Footprint and Greenhouse Gas emissions. The findings reveal that Climate Finance significantly contributes to reducing the Ecological Footprint by fostering investments in renewable energy, low-carbon technologies, and ecosystem restoration initiatives. Concurrently, deeper integration into Global Value Chains enhances Ecological Sustainability by facilitating technological innovation, improving energy efficiency, and aligning industries with stringent environmental standards set by global partners. These relationships highlight the transformative potential of Climate Finance and Global Value Chain participation in promoting sustainable economic practices and reducing environmental degradation. While the study investigates notable gaps in the literature, it acknowledges limitations, including a relatively short data timeframe, scattered missing observations, and the exclusion of other moderating variables that may influence the relationships studied. Future research should address these gaps by incorporating more extensive datasets, exploring additional factors, and expanding the scope to provide a more comprehensive understanding of ES dynamics. These insights emphasize the need for targeted policies to optimize Climate Finance allocation, deepen Global Value Chain engagement, and accelerate sustainable development in resource-dependent economies