The dependence on non-renewable energy sources has been a major driver of economic growth in South Africa. Economic growth benefits the society via the provision of infrastructures, improvement in living standards and employment creation. However, it has its downsides, especially when an economy pays less attention to its natural environment while intensifying its desire for affluence (Uddin et al. 2019; Yasmeen et al. 2020). In Africa, South Africa is arguably the most developed. This development comes with employment generation, improved welfare, export expansion and a foreign direct investment (FDI) inflow. Now, keeping pace with this development comes at a cost to the environment. It has inflicted a trade-off between higher economic growth and lower environmental quality. Therefore, despite flourishing in terms of economic performances, the environmental attributes in South Africa have persistently deteriorated over time as the country now harbours an ecological deficit territory (Global Footprint Network (GFN), 2019). An ecological deficit territory is the one where the ecological footprint (EF) is higher than the biocapacity (Siriwat, Tiedt 2019; World Wildlife Fund, 2018). In South Africa, for instance, the biocapacity and EF were respectively 1.46 gha and 3.35 gha in 1990. The biocapacity dwindled to 1.26 gha, whereas the EF stood at 3.05 gha in 2000. In 2010, the EF soared to 3.60 gha, leading to a decline in the country's biocapacity to 1.08 gha. In 2017, the country's biocapacity declined to 1.03 gha, whereas its EF was 3.16 gha (GFN, 2019).
The EF is measured in global hectares (gha) of land. It measures the effects of anthropogenic activities on grazing land, crops land, ocean, forest products, carbon footprint and built-up land. Previous studies have used the EF to capture the influence of anthropogenic activities on the natural environment (Zameer et al. 2020; Destek, Sinha 2020; Zhang et al. 2020; Nathaniel 2020; Marti, Puertas 2020; Ulucak et al. 2020; Omoke et al. 2020; Baz et al. 2020; Yilanci, Pata 2020; Dogan et al. 2020; Altıntaş, Kassouri 2020; Zhang et al. 2020; Usman et al. 2020; Sharif et al. 2020). The link between natural resources (NR) extraction and the EF has been explored adequately well in the literature. According to Danish et al. (2019), economic growth is always accompanied by urbanisation and industrialisation. The latter encourages NR extraction, which could promote environmental degradation by reducing biocapacity. Activities such as mining, bush burning and deforestation have adverse effects on biodiversity as well as other components that support human existence (Balsalobre-Lorente et al. 2018). There is still no consensus on the impact of NR extraction on the EF. For instance, Zafar et al. (2019) and Ulucak et al. (2020) have discovered that NR extraction contributes to the well-being of the environment, whereas Hassan et al. (2019a, b) and Ahmed et al. (2020a, b) reported the opposite.
This study seeks to examine the NR–EF nexus in South Africa by considering the role of human capital and urbanisation. This study is super useful for South Africa, where economic advancement has intensified NR extraction, especially coal, due to large energy demand and the desire to earn foreign exchange. Unlike Japan, Germany, the USA, Italy, France and other developed countries, South Africa generated 94.6% of its electricity from coal sources in 2005, 94.7% in 2006, 93.7% in 2013, and 92.7% in 2015. Although it reduced to 88.0% in 2017, South Africa had a coal power generation capacity of 39 GW as of 2018 (World Development Indicator (WDI), 2019). Coal is a non-renewable energy source that increases the emission of noxious gases capable of causing environmental deterioration. Recent studies have alluded to the adverse effects of coal consumption in South Africa (Joshua et al. 2020; Joshua, Bekun 2020; Magazzino et al. 2020; Udi et al. 2020). As a result of being the biggest economy in Sub-Saharan Africa (SSA), the urbanisation rate—as well as CO2 emissions—have been on a stable rise in South Africa (Ndoricimpa 2017; Salahuddin et al. 2019). The urbanisation rate was 64.31%, 64.82%, 65.30%, 65.85%, 66.35% and 66.85% in 2014, 2015, 2016, 2017, 2018 and 2019 respectively (WDI, 2019). South Africa is currently the 14th highest emitter in the world (Salahuddin et al. 2019)
The excessive exploration of NR could impact the EF (Zafar et al. 2019). Natural resources such as forest and croplands reduce human-caused emissions (Panayotou 1993; GFN 2018), whereas resources such as coal and oil decline environmental quality (Ahmadov, van der Borg 2019). The link between NR consumption/exploration and economic growth cannot be overemphasised. The early stage of development is associated with increased energy demand with little attention to environmental quality. As the economy expands further, the demand for renewables, energy-efficient commodities, a clean environment and NR preservation is desired. Thus, environmental quality improves. This is the intuition behind the Environmental Kuznets Curve (EKC) hypothesis (Nathaniel et al. 2021a).
To curb environmental degradation, sustainable management practice is required for resources to regenerate. Education and skilled human capital are needed for the sustainable consumption of NR. Education creates the required awareness to adopt environmental-friendly and energy-efficient technologies (Nathaniel et al. 2021b; Zafar et al. 2019). A skilled human capital contributes to a nation's economic growth and also sees the need to uphold environmental quality. For these reasons and more, this study considers human capital in the NR–EF nexus for South Africa.
The contributions of this study are as follows: (i) This is a seminal study to investigate the relationship between NR, human capital, economic growth, urbanisation and the EF in South Africa's context. Additionally, previous studies on South Africa have overlooked this important demographic variable—human capital in the growth-environment nexus. (ii) The introduction of the interaction term between urbanisation and human capital will help to identify some of the new dimensions of urban sustainability. This will expose the importance of human capital development in enhancing environmental quality as the country seeks to attain the Sustainable Development Goals by 2030. (iii) This study applies robust econometric techniques, including the Bayer and Hanck (BH) (2013) combined cointegration test and the autoregressive distributed lag (ARDL) bounds test approach. These econometric procedures accommodate time-series issues, account for structural breaks and produce reliable results (Ahmed et al. 2020a).
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