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Top1. Introduction
Sustainable development, especially the environment and global warming, was a hot debate topic during the 74th session of the United Nations Assembly in Oct 2019. Majority of the world leaders’ emphasis collective efforts to protect the earth from the damages of global warming. Similarly, among the leaders of the world peacekeeping and maintaining friendly trade relations were also discussed. World Bank classified Algeria upper-middle-income country; on the other hand, Algeria is also a member of OPEC from 1986, and therefore its economy is heavily based on petroleum and hydrocarbon extraction. Roughly 60-62% of budget revenue, 30-32% of GDP, and more than 90% exports based on petroleum and hydrocarbons. However, Sahnoune et al. (2013) indicated, in their research analysis Algeria is the 3rd largest carbon dioxide emitter in the African Continent. Due to the fact of Global warming, Algeria also exposed to climate change effect, which can be observed by a significant decrease in annual rainfall in recent years, which is up to 30%.
Similarly, on the other hand, due to the large share of the desert in its geographical location, Algeria's capacity to absorb carbon is also very low. In order to meet all challenges of global warming, Algerian government had shown grave concerns and took relevant actions recently; therefore Algeria became the first developing country which is a signatory of Intended National Determined Contribution (INDC). Furthermore, it is a commitment to reduce carbon dioxide emission by at least 7% until 2030 (Bouznit et al., 2018). Nevertheless, the strong financial sector also considers a backbone for the economy. Budget surpluses, stable exchange rate along with sufficient foreign exchange reserves, are critical indicators of the substantial financial sector. Similarly, to strengthen financial sector positively contribute to economic growth as well. Foreign remittances and foreign direct investment, along with export, are always good to keep stable foreign exchange reserves, which indicate the stability of the economy.
People usually migrate from developing countries to developed countries to provide better life opportunities to their family members in home countries. Similarly, the nexus between remittances and growth has been highlighted by various researchers. In concluded remarks, it provides mixed results as Goschin (2013), and Meyer & Shera (2017) indicate in their research work that, remittances positively affect economic growth whereas studies like Lee (2009) and Rao & Hassan (2011) mention negative effect on remittance on economic growth. Algeria is the second-largest French-speaking country in the world. Furthermore, approximately 2 million Algerian people are living in France. The estimated amount of remittances inflow in Algeria is million $ 2,157. Nevertheless, Abida & Sghaier (2014) refers to the positive relationship between remittances and economic development in the case of Algeria in their empirical work. Moreover, Sharma et al. (2019) argue that the injection of remittances in economy induces consumption; furthermore, it increases quality of life and living standard of people, which increase energy consumption and might cause of higher carbon dioxide emission.
In addition, official development assistance as international assistance plays a significant role in the growth process for the developing countries. However, an empirical demonstration also provides inconclusive and conflicting results. Studies like Irandoust & Ericsson (2005) and Chatterjee et al. (2003) indicate in their work, a fruitful effect of foreign aid on economic stability process, and conversely, Ang (2010) & Rajan & Subranmanian (2008) mention negative affect. Similarly, in contrast, Kretschmer et al. (2013) assert that empirically there is very few evidence available, which provide the effect of aid on environment degradation via carbon dioxide emission. However, it might be true that higher carbon dioxide emission in developing countries is due to higher aid inflow. Similarly, in the case of development assistance, from 2010, the World Bank and Algeria sign a strategic partnership agreement, which is Reimbursable Advisory services (RAS). The major areas in terms of financial assistance covered by RAS are Agriculture, Financial sector, investment climate, export, education, and rural development for Algeria Vision 2035.