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Can Climate Investment be Financed by Debt?

More than half of EU countries had debt-to-GDP ratios above 60% at the end of 2022, and governments are facing contradictory demands to invest in emissions reductions and to lower their debt ratios. If the European Union is serious about fighting climate change, it cannot keep ignoring this policy dissonance.

PARIS – Climate ambitions are running into macroeconomic headwinds in the European Union and the United Kingdom.

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