June 30, 2020 |
The coronavirus epidemic could set off an unprecedented flow of private resources towards ESG (environmental, social, governance) assets in Latin America as the region’s governments gear up for economic reconstruction while accounting for climate change.
However, governments will face the challenge of economic reconstruction with depleted budgets. Already in a weak state, budgets and savings have been further undermined by economic stagnation at a time when increased spending on pandemic mitigation is required. Compounding the fiscal pressure is the collapse of tax revenue collected from key regional sectors, including tourism, commodities and remittances.
Special report: Finance in the age
At this moment in time, Latin American markets and economies are flashing red, yellow and orange. It is likely that investors will be looking to cement green financing into their portfolios as the world emerges from the ashes of COVID-19