The Global Climate Legislation Study found that, since 1997, the number of climate change laws and policies has doubled every 4-5 years. While the pace has been levelling off recently, the trend is clear. We have already seen examples of sharp devaluations in the fossil fuel and energy sector. One oft-cited example are the top four US coal producers.
Such a process – which takes place gradually and is coupled with a transition towards a more diversified asset portfolio for central banks – offers great opportunities but also poses significant challenges for our countries. On the one hand, it is reflected in a foreign capital inflow having several effects on our economies such as the following: 1.