Climate Stress, Terror Attacks, and Sustainable Development: A Trilemma Analysis of African Economies

ABSTRACT Africa faces overlapping pressures from rising climate vulnerability and persistent terrorism, yet empirical evidence on their combined implications for Sustainable Development remains limited. This study examines the climate–security–development nexus in Africa using an unbalanced panel of 37 countries over 2000–2022. Sustainable Development is measured by the Sustainable Development Goals Index (SDGI), climate vulnerability is proxied by the ND‐GAIN Vulnerability Index, and terrorism is captured using alternative incident‐based indicators (attacks, deaths, and injuries). Methodologically, the analysis applies second‐generation heterogeneous panel estimators—Cross‐Sectionally Augmented ARDL (CS‐ARDL), Common Correlated Effects Mean Group (CCEMG), and Augmented Mean Group (AMG)—to account for cross‐sectional dependence, slope heterogeneity, and dynamic adjustment. Interaction models are interpreted using marginal effects, complemented by robustness checks including lagged terrorism specifications, balanced/outlier‐trimmed samples, and a Sahel subregional stress test. The results show that climate vulnerability exerts a robust and economically meaningful negative effect on SDGI, particularly in the long run, confirming climate stress as a persistent structural constraint on development performance. Institutional quality consistently supports higher SDGI outcomes, indicating a stabilising governance role. In contrast, terrorism incident counts exhibit generally weak direct effects in the continental sample, and interaction terms provide limited statistical evidence of systematic amplification. However, Sahel estimates reveal stronger insecurity sensitivity, with attack frequency significantly associated with lower SDGI, highlighting contextual heterogeneity. Overall, the findings emphasise climate vulnerability and governance capacity as core drivers of Africa's Sustainable Development trajectories, while terrorism effects appear more context‐specific and largely indirect in aggregate macro specifications.