25th Geneva Report: Climate and Debt

The 25th Geneva Report on the World Economy discusses how, and by whom, climate mitigation and adaptation should be paid, considering debt instruments such as sovereign bonds, carbon credits, conditional official grants, and debt relief from both public and private sources. The authors provide six policy proposals to jointly address climate change and debt sustainability by focusing on financial instruments as a means of incentivizing governments to do the right thing and providing fiscal space for climate investment in countries that could not otherwise afford it. Progress can only be made through the utilization of policies which best suit individual country circumstances, bearing in mind their limitations and the potential trade-offs.