Commentary: A G7 alternative to China’s Belt and Road Initiative must address debt sustainability and environmental, social safeguards

SourceSalaam Gateway
SectorEconomy
CountryMiddle east

The track record of large-scale investment intervention comes with significant environmental, social and debt sustainability risks, writes Blake Goud, CEO of the Responsible Finance and Investment (RFI) Foundation, ahead of the start of the G7 Summit in the UK on June 11.

The Group of Seven Nations is reported to be working on a new climate-related infrastructure initiative that is expected to be called the Clean Green Initiative. As described, it represents a response from the G7 countries to the Belt and Road Initiative which China launched in 2013 that has funded $200 billion to date and expects to invest up to $1.3 trillion by 2027, according to Morgan Stanley.  In contrast, the “Clean Green Initiative” may come out as a strategic framework for sustainable development and green transition funding, rather than a new source of funding.   

There are several ways the G7’s Clean Green Initiative could develop, but its success or failure will depend critically on

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