During her first trips abroad since taking office, Treasury Secretary Janet Yellen called for spending on sustainable infrastructure to help tackle climate change. And she wants the private sector to step in.
But his pitch comes as infrastructure negotiations between the Biden administration and Republican lawmakers slowly advance in Washington.
Yellen is in London this week to meet with G7 finance ministers to discuss international priorities, including economic recovery from the coronavirus pandemic. She also spoke at the G20 Infrastructure Investors Dialogue, which aims to increase collaboration between member country officials and investors. According to the Organization for Economic Co-operation and Development, the infrastructure investment gap is expected to reach $ 15 trillion by 2040 as public and private spending decline.
“Funding new, high-quality ‘green infrastructure’ – infrastructure that is both resilient to extreme weather events and emits minimal greenhouse gases – is crucial to reducing these emissions, and we need you, the investors and infrastructure developers, to help lead the transition, “Yellen said in prepared remarks.
She said the annual global infrastructure investment deficit stands at $ 3 trillion and cannot be categorized by public funds.
“If the world has a realistic hope of achieving our climate goals and avoiding the most catastrophic effects of climate change, we must close this gap by investing in sustainable infrastructure,” Yellen said.
This isn’t the first time Yellen has called for private spending to help close the gap to help tackle climate change. But it comes as the Biden administration tries to negotiate a bipartisan deal with infrastructure lawmakers in the United States.
Senate Republicans in talks with the White House on Friday unveiled a $ 928 billion counter-offer infrastructure package after President Biden reduced his plan from more than $ 2 trillion to $ 1.7 trillion. dollars, but insisted on including spending on electric vehicles. The GOP’s new offer made no mention of spending to tackle climate change, a key aspect of the Biden proposal. West Virginia Senator Shelley Moore Capito, who is leading negotiations for Republicans, met with the president again at the White House on Wednesday.
In his remarks, Yellen pointed to the Biden administration’s proposal to spend $ 1.7 trillion over 10 years to upgrade roads and expand broadband, but said: “More importantly, they will help catalyze more. significant private sector investments in infrastructure and green technologies “.
She specifically focused on the proposed tax credit to leverage private spending on power lines. She also noted that in their plan, 40% of the benefits of spending on climate and clean infrastructure would go to underserved areas.
During his remarks, Yellen also discussed how G20 member countries can guide infrastructure investors without increasing the benefits to attract them.
“There are legitimate concerns about their potential impact on investment and project costs,” Yellen said of the principles the group is developing. But she said officials continue to hear from private investors that such principles to help guide investments are needed.
Meanwhile, back in Washington, Capito said she was “encouraged” after her last visit to the White House to talk about infrastructure. She will brief members of her own team and plans to reconnect with the president on Friday.