Climate finance, economic growth, and infrastructure development have an intimately interconnected agenda. The climate talks in Paris at COP21 present a historic opportunity to enhance how they might work together to combat the harmful effects of climate change.
In a new brief, Nonresident Senior Fellow Zia Qureshi argues that public policy provides signals and sets the regulatory and institutional framework that influences all actors who play a role in climate change, including private investors and consumers. He outlines four key roles that public policy will need to play as a result of the Paris conference.
First, he believes that “clear and comprehensive strategies for sustainable infrastructure and embed them in overall strategies for sustainable growth and development,” must be articulated by the participant countries. “Addressing one group of projects at a time will not do,” he says.
Second, he maintains that policy must be used to correct distortions in the pricing of natural resources and infrastructure services that create disincentives for effective action on climate change.
The confluence of the need for a major boost in infrastructure investment and the urgency of climate action makes this a critical moment. The Paris meeting can seize the moment by reaching an ambitious global compact on climate change that provides a strong impetus for sustainable infrastructure as the model for the future.
Third, governments will need to improve the enabling environment by strengthening “investment planning and project preparation and management capacity” as well as the “regulatory and institutional framework for private participation in infrastructure.”
Finally, he argues that mobilizing both public and private financing—through concessional financing, institutional investors, and many, many others—will be crucial.
COP21 at Paris: What to expect – The issues, the actors, and the road ahead on climate change
, and the key ways that public policy will need to play in supporting sustainable infrastructure in the efforts to combat climate change.
Christina Golubski contributed to this post.