The Relationship Between Electricity, Foreign Direct Investment and Economic Growth in Central Asian Countries

Abstract

The role of the energy sector in the economicgrowth and development of countries is notquestionable. Thus, this sector process andstructure are very important. The renewableenergy resources are energies obtained from thecontinuous energies occurring naturally. In theCentral Asian countries, the hydro electrical energyis one of the renewable energy resources, and itshould be utilized by these countries to improvethis sector. Energy consumption is one of socialeconomicdevelopment indicators. There are somany literatures about the relationship betweenenergy consumption and economic growth. Unlikeprevious literatures, in this study FDI has been addedas a third variable. In this study, whether or not FDIincreases the economic growth and then economicgrowth increases energy consumption, will beanalyzed by using time series methods analysis.Moreover, these relationships will be analyzed in fiveCentral Asian (Kazakhstan, Kyrgyzstan, Tajikistan,Turkmenistan and Uzbekistan) countries duringperiod 1991 to 2014. In this study, stationarity ofseries is formed and Johansen Cointegration testis utilized to see whether or not series are movingtogether in the long term.