The Wall Street Consensus at COP26: building a private finance system for net zero

The Wall Street Consensus started as a strategy to reorganize global development interventions around partnerships with global finance. The UN's Billions to Trillions agenda, the World Bank's Maximizing Finance for Development or the G20's Infrastructure as an Asset Class updated the Washington Consensus for the age of the portfolio glut, to ‘escort’ global (North) institutional investors and the managers of their trillions into development asset classes. Ten policy commandments forge a new ‘de-risking state’ that creates safety nets for investors in development assets, protecting their profits from demand risks attached to commodified infrastructure assets; political risks attached to (progressive) policies that would threaten cash flows, including nationalization, higher minimum wages and, critically, climate regulation; and from liquidity and currency risks. Under the promise of ‘building a private finance system for net zero’, COP26 hardwires the WSC regime of derisking into global climate initiatives, including the new  environmental mandate of central banks in high-income countries. Since greenwashing is a feature, not a bug, of private finance led decarbonisation,  COP26 will not deliver on its promises.  

The Speaker: 

Daniela Gabor is Professor of Economics and Macro-Finance at UWE Bristol. Her research develops three related themes under the umbrella of critical macro-finance.

Daniela is interested in shadow banking activities, in particular repo markets, and the implications for monetary theory, central banking, sovereign bond markets and regulatory activity. Her two research projects are Managing Shadow Money ​(funded by INET) and the Capital Markets Union (funded by FEPS).

In 2016, Daniela was invited as expert witness at the European Parliament's public hearing on the Capital Markets Union.

Her research develops the theme of transnational banks' involvement in policy deliberations around capital controls and crisis management in both global settings and in emerging markets. She researches the IMF's conditionality and advice on capital controls.