Effects of Climate Change on Poverty Reduction in African Emerging Economies: A Dynamic Panel Analysis

Abstract

This study investigates the economic impact of climate change on poverty reduction in 20 African emerging economies over the period 2014–2024. Using a dynamic panel Generalized Method of Moments (GMM) approach, the analysis examines the effects of total greenhouse gas (GHG) emissions, methane emissions from agriculture, and forest area, while controlling for GDP per capita and foreign aid inflows. The findings reveal that total GHG and methane emissions significantly increase poverty. Conversely, forest area was statistically insignificant in poverty reduction. The study concludes that climate change poses a significant barrier to poverty reduction in African emerging economies. However, sustained economic growth and strategically targeted foreign aid can mitigate these effects. Based on the conclusion, the study recommends that emerging economies should implement targeted strategies to reduce greenhouse gas and methane emissions, particularly from agriculture and industrial activities. This may include promoting clean energy technologies, climate-smart agriculture, and sustainable land-use practices.