The Mutual Relationship between Financial Development, CO2 Emission and Economic Growth in MENA Countries (System GMM in Dynamic Panel Data Approach)

The importance of renewable energy in economic growth, reducing environmental pollution and the role of financial resources on renewable energy projects express the importance of financial development in the development of renewable energy.This study examines the of clean energy, financial development, economic growth, and environmental quality in a group of developing countries during 1995-2018.For this purpose, the (GMM) method has been used for model estimation.The results show that increasing clean energy, carbon dioxide emissions and increasing foreign direct investment have boosted economic growth in the countries studied. Also, despite the positive impact of financial development on clean energy consumption, it has not been able to reduce pollution. In order to expand investment in renewable energy, projects related to this sector should have been easier and more accessible to large and basic investors. Proper financial structure can lead to an increase in the volume of investment and at the same time reduce costs. On the other hand, it should be noted that targeting for projects can play a facilitating role and lead to investment maturity. Access to effective and appropriate tools to reduce risk for private sector investment and the use of tools such as guaranteed purchase, standardized portfolio of renewable energy, quota policies and low-cost lending for renewable energy projects will be able to meet the challenges Overcome existing problems and reduce project risks to a great extent