Infrastructures Development, Environmental Quality and Economic Growth in Nigeria

 Journal of Infrastructure Development

The Earth as a planet supports human life, living and activities, attracting extensive and intensive socioeconomic influences on the economy. Such activities like infrastructures development exerts increasing and divers environmental quality concerns and hence the economic growth. While these variables appear interrelated due to many factors including population growth, urbanisation, etc. However, the relationship between infrastructures, environment and economic growth is not largely known especially in Nigeria. This study therefore investigated their relationship using time series data between 1990 and 2019 by adopting Co-integration estimation technique through the Bound test approach of auto regressive distributive lag method using percentage share of building and construction sector of gross domestic product (GDP), carbon dioxide, population growth GDP growth rate, etc. as variables. The study revealed that the infrastructures development and environmental quality explain economic growth and have both short and long run relationships while specifically population growth and agriculture, forestry, fishing, value added variables are positively significant to economic growth. The findings evidences of both short and long run relationships among the variables are significant and it is consequently recommended that new roles for infrastructure sets and production processes should consider environmental quality mindsets to achieve positive green economy outcomes in Nigeria.

It is an established scientific fact that the Earth is the only planet of the solar system that substantially supports human life and living. The dynamics of human living on earth have also attracted extensive and intensive socioeconomic activities while interacting with the environment–ecosystem. These activities include infrastructures (transport, housing, water and energy supplies) executed in the environment (biosphere, hydrosphere, atmosphere and lithosphere) that infuse externalities on the economy.

Infrastructures construction activities involve large scale of nature use changes, constitute externalities on other economic sectors and are associated with the building and construction sector (BCS) of the economy. BCS contribution to gross domestic product (GDP) in Nigeria rose slightly from 2.88% to 3.70% between years 2010 and 2016 according towith projected potential of contributing over 15% growth by 2020 and significantly enhances fixed capital formation.

Resultantly, infrastructures development exerts increasing and divers environmental quality externalities concerns where they occur. In Nigeria, greenhouse gas (GHG) emissions from renewable energy activities increased air pollution to 65% between 2000 and 2015. Deforestation rate at 11% (1.5 m hectares annually) leaves Nigeria with about 330,000 square kilometres of diminishing arable land, decreasing income per capita from agriculture, etc.

Ideally, infrastructures development underscores economic growth and defines the economy of economies but not without environmental sustainability concern. For example, road infrastructures facilitate efficient movement of goods and services but their construction affects biodiversity; water supply dam development improves agriculture, health and sanitation but makes the environment vulnerable to flooding, pollution, deforestation, etc. The infrastructures–environment nexus has been adduced to many factors not limited to industrialisation, increasing population growth, urbanisation, etc.

Nevertheless, the nexus creates positive and negative externalities for economic growth in developed and developing economies not limited to improved income per capita and output, yet decreasing agricultural output, increasing air pollution, health challenges, etc. There is therefore tension between the need for infrastructure development for economic growth and the goal of ensuring environment quality. From Nigerian experience, studies on the infrastructures, environment and growth nexus seldom enjoy mention, though there are few related efforts like GHG emissions and economic growth, climate change, water availability and agriculture, environmental impact assessment (EIA) for capital spending on infrastructures development for growth, etc.

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