Green Recovery

In the aftermath of COVID-19, governments around the world have deployed extraordinary policy measures to save lives and protect people’s livelihoods. And given the gravity of this crisis, significant further efforts will be needed—especially during the recovery phase. To ensure a sustainable recovery policymakers must act to promote a “green recovery.”

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Publications

EU Climate Mitigation Policy

This paper aims to contribute to the debate on the choice of policies to reach the more ambitious 2030 emission reduction goals currently under consideration. It provides an analysis of the macroeconomic and distributional impacts of different options to scale up the mitigation effort, and proposes enhancements to the existing EU policies. A key finding is that a well-designed package, consisting of more extensive carbon pricing across EU countries and sectors, combined with cuts in distortionary taxes and targeted green investment support, would allow the EU to reach the emission goals with practically no effects on aggregate income. To enhance the social and political acceptance of climate policies, part of the revenue from carbon pricing should be used to compensate the most vulnerable households and to support the transition of workers to greener jobs. A carbon border adjustment mechanism could complement the package to avoid an increase in emissions outside the EU due to higher carbon prices in the EU (“carbon leakage”). From a risk-reward perspective, the benefits of reducing the risk of extreme life-threatening climate events and the health benefits from lower air pollution clearly outweigh the costs of mitigation policies.

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Sectoral Policies for Climate Change Mitigation in the EU

This paper discusses sectoral policies needed to achieve the ambitious greenhouse gas (GHG) emissions reduction targets announced in the European Union’s Green Deal, complementing the companion paper “EU Climate Mitigation Policy”, which focuses on broader EU-level policies. With total emissions nearly a quarter below their 1990 level, the EU has made important progress, but the new goals will require much stronger policy action. Moreover, progress has varied across sectors. Emissions from power and industry have fallen by about a third, buildings by a quarter and agriculture by a fifth – while transport emissions have risen. This paper argues that this divergence reflects differences in effective carbon prices, but also cost differences among the available abatement channels, market imperfections, and policy gaps. It discusses specific sectoral policies needed to address these factors and achieve the new emissions reduction goals.

 

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Greening the Recovery

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Special Series on Fiscal Policies to Respond to COVID-19

Fiscal policy across the globe is rightly focused on fighting the COVID-19-induced economic crisis. But the climate change crisis remains, as does the need for decisive policy action to address it. Indeed, decisions taken now to address the COVID-19 crisis may shape the climate, and human health, for decades. This calls for fiscal policymakers to “green” their response to this crisis to prevent one crisis leading to another. Public support for such measures may be higher after the COVID-19 crisis.

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Beyond the Crisis

 

STRAIGHT TALK - F&D Magazine

 

Now is the time to take advantage of this opportunity to build a better world

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Blogs

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The Next Phase of the Crisis: Further Action Needed for a Resilient Recovery

July 15, 2020

When the Group of Twenty industrialized and emerging market economies (G-20) finance ministers and central bank governors last met in April, the world was in the midst of the Great Lockdown forced by the outbreak of COVID-19. As they meet virtually this week, many countries are gradually reopening, even as the pandemic remains with us. Clearly, we have entered a new phase of the crisis—one that will require further policy agility and action to secure a durable and shared recovery.

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Why Sustainable Food Systems are Needed in a post-COVID World

July 14, 2020

Food systems are essential to economic activity because they provide the energy that we need to live and work. However, macroeconomists have long ignored them in the belief that the global agri-food industry, now highly mechanized, subsidized and concentrated, offers all we could wish for when it comes to food.

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Fiscal Policies for the Recovery from COVID-19

May 06, 2020

Fiscal policies have provided large emergency lifelines to people and firms during the COVID-19 pandemic. They are also invaluable to increase a country’s readiness to respond to a crisis and to help with the recovery and beyond.

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Response like no other

A Global Crisis Like No Other Needs a Global Response Like No Other

April 20, 2020

By Kristalina Georgieva

I have been saying for a while that this is a “crisis like no other.” It is:

  • More complex, with interlinked shocks to our health and our economies that have brought our way of life to an almost complete stop;

  • More uncertain, as we are learning only gradually how to treat the novel virus, make containment most effective, and restart our economies; and

  • Truly global. Pandemics don’t respect borders, neither do the economic shocks they cause.

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Fiscal Policies to Contain the Damage from COVID-19 

APRIL 15, 2020

In times of pandemic, fiscal policy is key to save lives and protect people. Governments have to do whatever it takes. But they must make sure to keep the receipts.

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Speeches

EU Environment Ministers Video-conference

Closing Remarks

Kristalina Georgieva | July 13, 2020


Virtual High-Level Dialogue of the Carbon Pricing Leadership Coalition (CPLC)

Introductory Remarks

Tao Zhang, IMF Deputy Managing Director |June 9, 2020


Delphi Economic Forum V: “The Day After” 

Climate Change: From Awareness to Action

Tao Zhang, IMF Deputy Managing Director |June 9, 2020


Organization for Security and Cooperation in Europe Parliamentary Web Dialogue

Opening Remarks— COVID-19: Opportunities for a Green Recovery

Tao Zhang, IMF Deputy Managing Director | May 22, 2020


Petersberg Climate Dialogue XI

Managing Director’s Opening Remarks

Opening Remarks by Kristalina Georgieva April 29, 2020