The G20s Have Reneged on Numerous Carbon Agreements Worth a Stunning USD14 Trillion in Economic Stimulus

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Despite their numerous promises to “build back better,” governments are not spending their money on diverse emissions cuts, according to an overall review of the current economic recovery packages from the 20 major economies.

Governments are blowing their budget surpluses to avoid the recession brought on by the COVID-19 epidemic. The G20 group, which consists of the world’s 20 major economies, spent at least USD14 trillion in 2020 and 2021, which is close to China’s annual GDP.

Much of the money was spent on bolstering healthcare systems, wages, and welfare, as it should have been. Climate action, such as ‘building back better and ‘green new deals,’ was also pledged.

Those promises, according to our research, have yet to be realized. Amid the COVID-19 pandemic in the G20 economies, we compiled an inventory of fiscal stimulus spending and categorized many initiatives according to their expected impacts on GHG (greenhouse gas) emissions.

Stimulus Check & Economic Stimulus (1)
The G20s Have Reneged on Numerous Carbon Agreements Worth a Stunning USD14 Trillion in Economic Stimulus

Overall, we discovered that only 6% of overall stimulus investment (about US$860 billion) has been devoted to sectors that will reduce emissions, such as electric vehicles, making buildings more energy-efficient, and installing renewables.

Worse, the targeted activities that are most likely to increase the rate of global emissions, such as coal industry subsidies, account for nearly 3% of the whole stimulus investment. Furthermore, some techniques have changed slightly as various countries transitioned from economic rescue to recovery mode during lockdowns, when stores and other companies began to reopen.

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Green investments are now significantly less common than they were during prior recessions. Following the global financial crisis of 2007–09, for example, about 16 percent of global stimulus spending (around US$520 billion out of a total of $3.25 trillion) was directed at carbon reductions.

If a similar share had been pledged today, the total would have been US$2.2 trillion, more than double what has been pledged to reduce GHG emissions.

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