News from 2021-07-29 / KfW Research
Sustainable finance in German municipalities: Can green municipal loans break the ice?
Transitioning municipal public infrastructure to climate neutrality requires high investment amounts which can hardly be funded from current budgets. The international capital market provides sustainable finance but municipalities have so far hardly tapped into this funding source because the customary capital market instruments are not suitable for many municipalities. Alternatives that are based on established instruments such as municipal loans are therefore necessary. However, in order to enable green municipal loans to achieve a breakthrough, further changes and pioneers will also be required in municipal finance.