The Challenges of Overcoming the External Constraint in Latin America: An Examination of the Potentials and Challenges of Green Financing Using a Political Economy Perspective

Abstract

With a political economy perspective, the article reviews the general conditions under which Latin American and Caribbean countries face the challenge of overcoming the current economic stagnation scenario, particularly regarding external indebtedness. Subsequently, it explores the possibilities and limitations offered by green bond initiatives and debt for nature swaps. The main hypothesis of this article is that green financing proposals, under the actual context, reinforce the structural power of finance, and thus require a restructuring of the international architecture and power dynamics within the financial sector.