Green Bonds: what contribution to the Paris Agreement and how to maximize it?

2022, France is paying dearly for a dependence on fossil fuels maintained by a chronic lack of investment in the decarbonisation of the economy. This edition of the Landscape of climate finance in France makes a detailed analysis of these critical expenditures by households, companies and public authorities, in the retrofitting of buildings, the purchase of electric vehicles, and renewable energies, as well as in rail, cycling and urban public transport infrastructures. Encouragingly, climate investments have increased significantly in the past year, driven, among other factors, by favourable regulations and by state support under the recovery plan. But this growth remains fragile, and analysis of several transition scenarios shows that climate investments need to increase further in order to stay on track to carbon neutrality and to ensure a lasting reduction in France’s dependence on fossil fuels.

2022 was an eventful year in terms of climate. The year saw the emergence of a new concept, that of the polycrisis: war in Ukraine, the aftereffects of Covid, the return of inflation, the gas crisis, agricultural shortages, persistent droughts and other dramatic climatic events… all of these crises have ultimately pointed to our direct or indirect dependence on fossil fuels; our weaknesses when faced with a changing climate; and the vulnerability of our economies and the middle and lower classes.

As COP27 draws to a close, let us remember the obvious: implementing the Paris Agreement will require financial flows from developed to developing countries. However, these flows are not just the much discussed $100 billion a year promised by the nations of the North to their counterparts in the South – a promise that has not been kept to date. And they are not just about budgetary flows either. More fundamentally, the architecture of development financing – or at least its climate component – needs to be reviewed in depth. It is therefore primarily the mission and modus operandi of the multilateral banks, and more broadly of the public development banks, that must be reviewed.