Nepal’s domestic material consumption—projection and causal impact of external financial inflows, services value-added, population, and economic growth

Springer Nature
Publication Type:
Journal Article
Environ Sci Pollut Res Int, 2022, 29, (22), pp. 33674-33697
Issue Date:
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Literature on material flow accounting has increasingly emphasized the need for an equitable resource allocation for least developed countries LDCs considering their future growth and the social outcomes e g poverty alleviation they intend to deliver This paper aims to project Nepal s domestic material consumption DMC scale and structure for different economic growth scenarios We also investigate the causal impact of exogenous factors 1 external financial inflows such as the remittance and official development assistance ODA 2 services value added 3 population and 4 economic growth on DMC by material types e g biomass fossil fuels non metallic minerals and metal ores We use the R tools ridge regression and its machine learning algorithms the autoregressive distributed lag approach and the abovementioned variables time series data between 1993 and 2017 as methodological and data tools While Nepal s absolute DMC will increase even in the low growth scenario we found that the biomass based DMC prevalent in many LDCs including Nepal will be non metallic minerals based a material consumption trait of existing middle income and emerging economies Despite this the United Nations LDC graduation growth pathway often assumed to deliver sustainable development objectives by policymakers in LDCs including Nepal is material intensive The increase in the gross domestic product per capita remittance and ODA cause a rise in DMC because of their strong correlation and causal relationship In these circumstances we suggest policy measures that can leverage present consumption oriented remittances as a source of investment in up scaling small scale modern renewable energy technologies across the residential sector particularly in rural areas We suggest this policy measure considering the future rise in non metallic minerals and the challenges to reduce it because of the rising urbanization 2021 The Author s under exclusive licence to Springer Verlag GmbH Germany part of Springer Nature
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