The world’s largest economies are to ensure regulation is not preventing pension funds and other institutions from investing in infrastructure under an agreement signed at the G20 summit.
The meeting, held on Brisbane, saw the heads of government agree to implement the OECD’s high-level principles of long-term investment financing, which said public funding should not “crowd out” private long-term capital. In a communiqué announcing the G20 global infrastructure initiative, world leaders said they would look to increase the transparency and functioning of securitisation markets, a goal of the European Commission to attract funding to small and medium-sized enterprises. “These actions will assist in our goal to attract increased private sector financing for infrastructure investment and for small and medium enterprises,” the agreement said.
It added that work would be undertaken to develop infrastructure further as an asset class and increase the amount of financing available to markets. As part of the initiative, the G20 will launch an infrastructure hub based in Sydney to coordinate global governments’ efforts.
Against expectations, the G20 also said it supported “strong and effective action” on climate change but did not include any specific wording on cultivating a low-carbon economy. Those in favour of the matter being discussed in Brisbane have pointed to the need for the largest economies to reach a compromise ahead of next year’s climate conference in Paris, which aims to agree new and binding carbon-reduction targets.
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