Role of Artificial Intelligence and Environmental Digitalization in Mitigating Climate Risks for Sustainable Development amid Geopolitical Uncertainty

In a volatile global environment, tech-driven nations grapple with formidable challenges, specifically in the wake of climate change risk. Due to their heavy reliance on technology, they are highly vulnerable to climate change, impeding sustainable development. This study delves into the intricate relationships between climate change risk, environmental digitalization, and sustainable development in the twelve leading tech-driven nations, furnishing significant insights into an underexplored domain calling for further scholarly attention. The novelty of the study lies in highlighting the pivotal role of Artificial Intelligence (AI) in augmenting the climate change risk-sustainable development nexus, consequently addressing and filling a research gap. Our study employs the Panel ARDL-PMG, ARDL-MG, ARDL-DFE, and ARDL-ECM techniques, spanning the period from 2000 to 2022. The study finds that climate change risks negatively impact sustainable development. Notably, AI plays an indispensable moderating role in mitigating these adverse effects by enhancing adaptive capacities and facilitating more informed decision-making processes. In addition, environmental digitalization is found to have a positive and significant impact on sustainable development, serving as a driver of innovation and efficiency in sustainability initiatives. While geopolitical tensions significantly hinder SD. This research provides actionable guidance for policymakers and stimulates the development of impactful training programs tailored to digitalization, ultimately advancing sustainable development.