G20 ministers gathered at the Trade, Investment and Industry Ministerial Meeting in Bali on 22 and 23 September 2022 welcomed the “ G20 Compendium on Promoting Investment for Sustainable Development .” UNCTAD prepared the compendium under the guidance of the Indonesian presidency of the G20, with inputs from all G20 members and some associated countries.
It includes strategies, policies, investment promotion activities and international collaboration initiatives of the G20 and some associated countries aimed at promoting investment in sectors linked to the UN Sustainable Development Goals (SDGs). It highlights that:
Several G20 members and associated countries have adopted pluriannual, comprehensive national strategies and plans designed to provide a roadmap for sustainable development, which either include a focus on the promotion of sustainable investment or directions for the promotion of sustainable production.
Most G20 members and associated countries also rely on targeted strategies for the promotion of sustainable investment in specific sectors, such as renewable and clean energy, energy efficiency, water management and sanitation, transport, finance, and health.
The most frequent policy instrument used to support the transition to a green economy and promote a circular economy are fiscal mechanisms, such as carbon pricing, income tax relief, tax exemption, and tax credits.
Non-fiscal incentives are also frequently used, including subsidized loans and other financial instruments (e.g. green loans, green insurance, or green funds) often aimed at de-risking investment in climate mitigation.
Several G20 members and associated countries are promoting sustainable investment and responsible business conduct through national environmental, social, and governance (ESG) policies, the adoption of standards and regulations, and the development of green bond and sovereign green bond schemes with the aim of incentivizing private-sector firms to issue green bonds based on internationally recognized environmental standards.
Government entities from G20 members and associated countries are increasingly pushing forward sustainable development issues both in their inward and outward foreign direct investment (FDI) promotion efforts.
Free trade agreements (FTAs) and international investment agreements (IIAs) are considered key drivers to facilitate international investment and some countries are specifically adopting new types of trade instruments and international agreements aiming to promote sustainable investment and responsible business conducts.