Finance for fossils – The role of public financing in expanding petrochemicals

IF 8.6 1区环境科学与生态学 Q1 ENVIRONMENTAL SCIENCES

Global Environmental Change Pub Date : 2023-05-01 DOI:10.1016/j.gloenvcha.2023.102657

Jakob Skovgaard , Guy Finkill , Fredric Bauer , Max Åhman , Tobias Dan Nielsen

{"title":"Finance for fossils – The role of public financing in expanding petrochemicals","authors":"Jakob Skovgaard , Guy Finkill , Fredric Bauer , Max Åhman , Tobias Dan Nielsen","doi":"10.1016/j.gloenvcha.2023.102657","DOIUrl":null,"url":null,"abstract":"<div><p>The petrochemicals industry (mainly plastics and fertilizer production) is expanding, despite increasing attention to the environmental impact of petrochemicals. In our paper, we explore the role public finance plays in the petrochemicals industry. We do so by mapping the public and private financial flows into large-scale petrochemical projects for the decade 2010–20 and discuss the role of public financial institutions for the development of the industry globally. Secondly, we provide a detailed analysis of the roles international and national public finance has played in enabling two prominent petrochemical projects: namely the Sadara plant in Saudi Arabia and the Surgil plant in Uzbekistan. The cases are illustrative of the dynamics of state interest and involvement in fossil fuel producing countries as well as of lending and guarantees from foreign export credit agencies (ECAs) and development finance institutions, and how such public finance plays an important role in leveraging private finance. Our findings show how public finance for petrochemicals is highly globalized and to a large degree originates in developed countries. As petrochemical industrial infrastructures are designed to last decades, the public finance thus strongly contributes to the carbon lock-in of the sector and limits the possibilities for low-carbon investments needed to comply with the UN Paris Agreement.</p></div>","PeriodicalId":328,"journal":{"name":"Global Environmental Change","volume":"80 ","pages":"Article 102657"},"PeriodicalIF":8.6000,"publicationDate":"2023-05-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Global Environmental Change","FirstCategoryId":"6","ListUrlMain":"https://www.sciencedirect.com/science/article/pii/S0959378023000237","RegionNum":1,"RegionCategory":"环境科学与生态学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q1","JCRName":"ENVIRONMENTAL SCIENCES","Score":null,"Total":0}

引用次数: 0

Abstract

The petrochemicals industry (mainly plastics and fertilizer production) is expanding, despite increasing attention to the environmental impact of petrochemicals. In our paper, we explore the role public finance plays in the petrochemicals industry. We do so by mapping the public and private financial flows into large-scale petrochemical projects for the decade 2010–20 and discuss the role of public financial institutions for the development of the industry globally. Secondly, we provide a detailed analysis of the roles international and national public finance has played in enabling two prominent petrochemical projects: namely the Sadara plant in Saudi Arabia and the Surgil plant in Uzbekistan. The cases are illustrative of the dynamics of state interest and involvement in fossil fuel producing countries as well as of lending and guarantees from foreign export credit agencies (ECAs) and development finance institutions, and how such public finance plays an important role in leveraging private finance. Our findings show how public finance for petrochemicals is highly globalized and to a large degree originates in developed countries. As petrochemical industrial infrastructures are designed to last decades, the public finance thus strongly contributes to the carbon lock-in of the sector and limits the possibilities for low-carbon investments needed to comply with the UN Paris Agreement.

查看原文本刊更多论文

化石融资-公共融资在扩大石化产品中的作用

尽管人们越来越关注石化产品对环境的影响，但石化工业(主要是塑料和化肥生产)仍在扩大。在本文中，我们探讨了公共财政在石化行业中的作用。为此，我们绘制了2010 - 2020年间公共和私人资金流入大型石化项目的地图，并讨论了公共金融机构在全球行业发展中的作用。其次，我们详细分析了国际和国家公共财政在两个突出的石化项目中所起的作用:即沙特阿拉伯的Sadara工厂和乌兹别克斯坦的Surgil工厂。这些案例说明了国家利益和参与化石燃料生产国的动态，以及外国出口信贷机构(eca)和发展金融机构的贷款和担保，以及这些公共财政如何在撬动私人融资方面发挥重要作用。我们的研究结果表明，石油化工的公共财政是如何高度全球化的，并且在很大程度上起源于发达国家。由于石化工业基础设施的设计寿命长达数十年，因此公共财政极大地促进了该行业的碳锁定，并限制了遵守《联合国巴黎协定》所需的低碳投资的可能性。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

求助全文

约1分钟内获得全文求助全文

来源期刊

Global Environmental Change 环境科学-环境科学

CiteScore

18.20

自引率

2.20%

发文量

146

审稿时长

12 months

期刊介绍： Global Environmental Change is a prestigious international journal that publishes articles of high quality, both theoretically and empirically rigorous. The journal aims to contribute to the understanding of global environmental change from the perspectives of human and policy dimensions. Specifically, it considers global environmental change as the result of processes occurring at the local level, but with wide-ranging impacts on various spatial, temporal, and socio-political scales. In terms of content, the journal seeks articles with a strong social science component. This includes research that examines the societal drivers and consequences of environmental change, as well as social and policy processes that aim to address these challenges. While the journal covers a broad range of topics, including biodiversity and ecosystem services, climate, coasts, food systems, land use and land cover, oceans, urban areas, and water resources, it also welcomes contributions that investigate the drivers, consequences, and management of other areas affected by environmental change. Overall, Global Environmental Change encourages research that deepens our understanding of the complex interactions between human activities and the environment, with the goal of informing policy and decision-making.