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A window of opportunity: five ways international financial institutions can support the transition to green steel in emerging and developing economies

The 2020s are a crucial window in which the transition to green steel must be accelerated to avoid lock-in to high-polluting assets for the next 15-25 years. International financial institutions can play an important role in kick-starting the transition to green steel, especially in emerging and developing regions.

Aaron Maltais, Linus Linde, Felipe Sanchez, Gökçe Mete / Published on 3 November 2022
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Citation

Maltais, A., Linde, L., Sanchez, F. and Mete, G. (2022). A window of opportunity: five ways international finance institutions can support the transition to green steel in emerging and developing economies. LeadIT Research Report. Stockholm Environment Institute, Stockholm.

Demand for steel is expected to increase in the coming decades as population growth, industrialization, and urbanization in emerging and developing economies continue. The need for these countries to leapfrog to green steel production provides a unique opportunity for international finance institutions to support the global steel transition by:

  • Acting as knowledge partners for governments to strengthen an enabling policy framework for green steel
  • Supporting country roadmaps for green hydrogen
  • De-risking and financing first movers in industrial production, small and medium-sized enterprises in green value chains, and utility-scale renewables
  • Supporting demand for green steel through procurement strategies in IFIs’ own operations
  • Supporting secondary steel production and circular business models to scale up scrap-based production.

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SEI authors

Aaron Maltais
Aaron Maltais

Senior Research Fellow

SEI Headquarters

Felipe Sanchez
Felipe Sanchez

Policy Fellow

SEI Headquarters

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