Sustainability, Policy, and Global Impact: A Comparative Analysis
Energy Consumption and Economic Growth
Muhammet Enes Çıraklı, Huzeyfe TorunEnergy trade is among the most important determinants of the current account balance around the world. Türkiye as a developing country with relatively low level of energy sources and with reasonably high growth rates, is dependent on energy imports. Unlike the previous decades, high dependency on energy is not a critical matter for only current account balance but also for the sustainability of the environment and greenness of the economy. Since most of the energy imports originate from non-renewable sources and the domestic investments tend to utilize renewable ones, for a given economic growth level in Türkiye, the reduction of energy imports and sustainability of the environment are complementary. In this study, we first point to the positive relationship between economic growth and overall energy consumption in Türkiye. Next, we provide descriptive statistics suggesting that this relationship has been weakening in recent periods. More concretely, the energy intensity indicator that is calculated through dividing Türkiye’s energy consumption by its real GDP has been declining over years. Finally, we explore the same relationship for a high number of countries using data from World Bank and British Petroleum (BP) databases; and look at the relative change in the energy intensity of economic growths across the world. We conclude that there is even more room for improvement in this dimension for Türkiye which may eventually lead to a better current account balance and a more sustainable environment in the future.
