Sustainable growth in South Africa through the asymmetric effects of oil prices and economic policy uncertainty

Economic policy uncertainty (EPU) and oil price shocks can have a substantial influence on economic development, nevertheless their asymmetrical impacts on green economic growth are not widely investigated. Therefore, this study examines the asymmetric effect oil price and EPU on green economic growth using advanced nonlinear techniques, and quarterly data from 1990Q1 to 2020Q4. The empirical findings show that higher oil price induce a decline in green economic growth, while a decrease in oil price promotes green economic growth. On the other hand, the study found that an increase in EPU has positive and significant effect on green economic growth while a decline in EPU has an adverse and substantial impact on sustainable economic growth. These outcomes highlight the need for decisionmakers in South Africa to effectively leverage rising policy uncertainty to promote green growth while decreasing oil reliance to mitigate the negative influence of higher oil prices and capitalize on the benefits of falling prices.