Energy Consumption and Current Account Balance: Empirical from Asian Countries

This study examines the effect of energy consumption on current account balance of 15 Asian countries.The analysis in this study was carried out using panel data with the simultaneous equation method.Research data from 1998-2022 in 15 Asian countries (Bangladesh, China, India, India, Japan, Jordan, Korea Republic, Kuwait, Kyrgyz Republic, Malaysia, Oman, Saudi Arabia, Singapore, Thailand and Vietnam) are sourced from the World Development Indicator, World Bank.The simultaneous equation method was chosen to provide more comprehensive results in conducting complete research and interpretation.The results of the study indicate that fossil fuels, gross domestic product (GDP) per capita and population have a significant effect, while the current account balance, access to electricity and broad money do not have a significant effect on energy consumption.Energy consumption and net exports have a significant effect, while the exchange rate and foreign direct investment do not significantly impact the current account balance.These findings have important implications for policy makers in Asian countries policies that encourage energy efficiency and diversification of domestic energy sources.More proactive policies in the development of renewable energy can not only reduce the current account balances deficit but also national energy security.