Journal of Environmental Science Studies

Journal of Environmental Science Studies

Investigating the Environmental Impact of ICT Imports, Differentiated by Global North and South Regions, on Iran's Steel Industry

Document Type : Original Article

Authors
1 Associate Professor, Faculty of Management and Economics, Shahid Bahonar University, kerman, Iran.
2 Ph.D. Candidate, Faculty of Management and Economics, Shahid Bahonar University, kerman, Iran
3 Professor, Faculty of Management and Economics, Shahid Bahonar University, kerman, Iran
4 Associate Professor, Faculty of Management and Economics, Shahid Bahonar University, kerman, Iran
10.22034/jess.2025.550377.2410
Abstract
Achieving sustainable development necessitates leveraging existing potentials and utilizing international opportunities to foster desirable economic growth while adhering to appropriate environmental standards. The development of energy-intensive industries, particularly the iron and steel sector, can accelerate economic growth but may entail adverse environmental impacts, thereby undermining the trajectory of sustainable development. As one of the international opportunities, importing high-technology goods, such as information and communication technology (ICT) products, and integrating them into production processes can drive economic growth. Furthermore, if ICT imports are accompanied by technological spillovers, they may contribute to cleaner production technologies in energy-intensive industries like iron and steel. It is noteworthy that the level of development of the exporting countries and their capacity to absorb and apply foreign technology in the importing country are critical factors influencing the extent of productivity spillovers.
In this study, a multi-regional general equilibrium model is employed to investigate the effects of ICT imports on environmental variables and the iron and steel sector. To this end, the world’s countries are aggregated into three regions: Iran (the ICT importer), developed countries, and developing countries (the ICT-exporting regions).
The results indicate that, in addition to increased production and exports, energy demand, carbon emissions, and energy intensity in the iron and steel sector rise, while carbon dioxide intensity decreases. Moreover, if the source region is developing countries, ICT imports from both developed and developing regions render the production techniques in the iron and steel sector more polluting. A key finding is that technological spillovers from imports originating in developing countries lead to a deterioration in both technique and composition effects in the iron and steel sector, resulting in higher carbon emissions. Conversely, when imports originate from developed countries, technological spillovers improve the technique and composition of production at the macro level, reducing output in the iron and steel sector and shifting production techniques toward cleaner inputs.
Based on these findings, it is recommended that, if environmental considerations are prioritized, importing ICT from developed countries should be emphasized. Efforts should focus on removing tariff and non-tariff barriers to imports from developed regions to facilitate this process.


Introduction
Global warming has prompted nations worldwide to seek effective strategies to mitigate its impacts. To this end, annual global conferences, known as the Conference of the Parties (COP), are convened with the primary objective of reducing greenhouse gas emissions. Carbon dioxide (CO₂) constitutes the largest share of greenhouse gases, primarily emitted through the consumption of fossil fuels across various economic sectors. Energy-intensive industries, particularly the iron and steel sector, are among the most significant contributors to carbon emissions.
As a country with substantial energy reserves and a prominent iron and steel industry, Iran plays a critical role in global carbon emissions. Several factors can contribute to mitigating the adverse environmental impacts of this sector, with the adoption of information and communication technology (ICT) goods and their associated technologies in production processes being a key determinant in reducing carbon emissions. For countries lacking the capacity to produce high-technology ICT goods domestically, access to these technologies can be achieved through imports or foreign direct investment (FDI).
The technological sophistication of ICT goods varies across countries. For instance, ICT imports from developed nations typically embody higher technological advancements compared to those from developing countries. Moreover, the environmental cleanliness of these technologies may differ, leading to varying environmental impacts in the importing countries. Additionally, imports may generate spillover effects, such as technology transfer, the extent of which depends on the recipient country's capacity to absorb foreign technology.
This study employs a multi-regional computable general equilibrium (CGE) model to investigate the impact of ICT imports on a range of variables within the iron and steel sector. The analysis evaluates how the integration of ICT goods influences carbon emissions, energy consumption, and related intensities, considering both direct effects and potential technological spillovers.

Materials and methods
In this study, a multi-regional general equilibrium model is employed to investigate the effects of ICT imports on environmental variables and the iron and steel sector. To this end, the world’s countries are aggregated into three regions: Iran (the ICT importer), developed countries, and developing countries (the ICT-exporting regions).

Results and discussion
The results indicate that, in addition to increased production and exports, energy demand, carbon emissions, and energy intensity in the iron and steel sector rise, while carbon dioxide intensity decreases. Moreover, if the source region is developing countries, ICT imports from both developed and developing regions render the production techniques in the iron and steel sector more polluting. A key finding is that technological spillovers from imports originating in developing countries lead to a deterioration in both technique and composition effects in the iron and steel sector, resulting in higher carbon emissions. Conversely, when imports originate from developed countries, technological spillovers improve the technique and composition of production at the macro level, reducing output in the iron and steel sector and shifting production techniques toward cleaner inputs.

Conclusion
Based on the findings, the following policy recommendations are proposed to promote technological advancement and environmental sustainability in Iran’s iron and steel sector. First, to accelerate technological progress, it is imperative to address barriers to importing information and communication technology (ICT) goods, particularly from developed countries. Second, enhancing technology absorption capacities—such as human capital, institutional quality, and research and development (R&D) capabilities—will facilitate greater technological spillovers, thereby strengthening Iran’s technological base. Third, if policymakers aim to align with global environmental objectives, prioritizing ICT imports from developed countries is advisable due to their higher technological sophistication and cleaner production standards. Imports from developed nations are likely to yield greater environmental and technological benefits. However, if the objective is to expand iron and steel production while adhering to environmental standards, efforts should focus on removing both tariff and non-tariff barriers to ICT imports from both developed and developing countries.

In this study, a multi-regional general equilibrium model is employed to investigate the effects of ICT imports on environmental variables and the iron and steel sector. To this end, the world’s countries are aggregated into three regions: Iran (the ICT importer), developed countries, and developing countries (the ICT-exporting regions).
The results indicate that, in addition to increased production and exports, energy demand, carbon emissions, and energy intensity in the iron and steel sector rise, while carbon dioxide intensity decreases. Moreover, if the source region is developing countries, ICT imports from both developed and developing regions render the production techniques in the iron and steel sector more polluting. A key finding is that technological spillovers from imports originating in developing countries lead to a deterioration in both technique and composition effects in the iron and steel sector, resulting in higher carbon emissions. Conversely, when imports originate from developed countries, technological spillovers improve the technique and composition of production at the macro level, reducing output in the iron and steel sector and shifting production techniques toward cleaner inputs.
Based on these findings, it is recommended that, if environmental considerations are prioritized, importing ICT from developed countries should be emphasized. Efforts should focus on removing tariff and non-tariff barriers to imports from developed regions to facilitate this process.
Keywords