Regulatory Alerts2024-01-01
Climate Change and the Balance of Payments: Considerations for Trinidad and Tobago
The Central Bank of Trinidad and Tobago issued this working paper to assess how climate change transition risks impact the country's balance of payments. Utilizing the IMF’s “At-risk” framework, the study identifies that shocks to international energy prices aligned with Paris Agreement Net Zero objectives pose major downside risks to the current account balance. Consequently, the authors recommend that policymakers intensify efforts to manage fossil fuel exposure, increase renewable energy investment, and expand non-energy sector exports.
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