The Political Economy of Green Transitions: Financing Climate Action in the Global South
Keywords:
Climate Finance, Global South, Political Economy, Just Transition, Debt-Climate Nexus, Green BondsAbstract
This paper will discuss the political economy of green transitions financing in the Global South and explore both the structural constraints and geopolitical limitations alongside market-based constraints that prevent fair distribution of climate finance flows. The primary research objectives include the evaluation of the influence of political and economic structures on the availability of green financing, and finding the policy options that can be used to be more effective in climate investment. With a mixed-methods approach, the study incorporates the dependency theory and world-systems theory frameworks along with the green political economy, and comparative case studies are also carried out in Brazil, Kenya, India, and Indonesia. The information was collected using policy analysis, interviews, and flow assessment of finances. The main conclusions are that there are inequalities of long-term North-South disparities, and merely 14 percent of multilateral climate funds are reaching Least Developed Countries (LDCs). Market-based mechanisms put a higher value on profitable mitigation efforts than adaptation, and debt-climate traps compel highly vulnerable countries to redirect their resources towards resilience-building. Contradictions referring to case studies are noted, including the example of Kenya green bonds pioneer in not responding to the rural energy poverty and India clean energy fund living side by side with coal growth. The study is relevant to the discussion on climate justice because it reveals the ways in which current finance structures reproduce inequality. It suggests 6 evidence-based suggestions, among which are the democratization of climate governance, the requirement of 30% of private funds to the adaptation. The paper draws a conclusion that just transition principles demand systemic rather than incremental reforms in order to bring financial flows in line with just transition principles.
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