The role of ECAs in financing the transition to net zero

(Global Policy Journal, Durham, 23 September 2022) There is no net-zero world without a sustainable trading system, and trade finance is estimated to contribute to between 80–90% of all world trade. The first steps toward green ECAs have been taken, with the agreement announced at COP26 to end export credit support of unabated coal-fired power plants and the first net zero commitments to be made by [some] leading ECAs. In the coming months, there is an opportunity for the broader ECA community to step into the net zero-fold and work with private finance, policy makers, scientists, and civil society to accelerate an orderly and just transition to a net zero global economy. Our world depends on it. [Read the full 6 page report here. However, climate scientists warned in 2021 that the concept of net zero is a dangerous trap, noting that  “Net zero” is the point at which any residual emissions of greenhouse gases are balanced by technologies removing them from the atmosphere. This is a great idea, in principle. Unfortunately, in practice it helps perpetuate a belief in technological salvation and diminishes the sense of urgency surrounding the need to curb emissions now.]