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Since the 1970s, the role of trade liberalization and foreign direct investment in
promoting environmental sustainability has been a hot topic in academics. While some research
supports the Porter hypothesis, others support the pollution-haven hypothesis. Accordingly, this
study aims to determine whether the pollution haven hypothesis holds by examining how trade
openness and foreign direct investment affect Nigeria’s environmental sustainability for the
period of 1981 to 2021. By deploying the dynamic ordinary least square (DOLS) estimation
technique, the study outcomes indicate that trade openness and foreign direct investment have
a negative and significant long-term effect on Nigeria’s greenhouse gas emissions. Therefore,
the results of this study support the Potter hypothesis, which holds that emerging nations
become centers of advanced and cleaner technology as a result of trade liberalization and
foreign direct investment. As a result, the study suggests that the Nigerian government should
support the creation of compressed natural gas (CNG) stations and the switch to CNG-powered
vehicles. The Nigerian government can also promote investment in the green energy industry
by offering tax holidays and other benefits to companies in this field. Furthermore, there should
be a widespread public education campaign on the threat posed by global warming and the
necessity of planting trees to mitigate the effects of climate change and discourage tree-cutting.
