Abstract:

This paper evaluates the efficiency of environmental reduction policies in terms of their impact on the Saudi economy and environmental quality. It explores the future trends of environmental pollution in Saudi Arabia, through analysis efficiency of the environmental mitigation policies. This is done by employing mitigation scenarios for two models: CO2 model and other GHG model. Firstly, the VECM approach is employed to estimate the relationship between economic growth and GHGs emissions from 1981-2010, and then the mitigation scenarios including business as usual scenario examine the future trends of this relationship over the period of 2011-2030 in Saudi Arabia. The results of the two models showed that cuts to CO2 emissions and other GHG emissions by 5% and 0.05% will decrease the GDP of Saudi Arabia. However, Saudi Arabian policymakers have to choose appropriate environmental reduction policies to avoid the impacts of these policies on GDP and focus on adopting smart growth to draw appropriate future plans that could support the country to reach sustainable development. Key Words: VECM, Environmental Policies, Mitigation Scenarios, CO2 Emissions; Other GHGS Emissions.

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