Maximizing Policy and Fiscal Space for an Inclusive Green Strategy

Eva Paus ()
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Eva Paus: Mount Holyoke College, Economics

Chapter Chapter 3 in Toward Inclusive Development in Latin America, 2026, pp 61-89 from Palgrave Macmillan

Abstract: Abstract Latin American governments need to have the requisite policy and fiscal space to implement an inclusive green development strategy. In this chapter, I analyze two important factors which impact that space significantly: the commitments and demands under international trade and investment agreements, and the financial resources available to achieve the desired goals. I propose possible actions to broaden the space, both at the international and the national level. Internationally, the rules need to be made compatible with the Sustainable Development Goals, and thus with the implementation of an inclusive green transition, and financial resources for a green transition have to grow considerably. Nationally, governments can expand policy space by terminating international investment agreements which include an investor-state dispute settlement mechanism. And they can increase fiscal space in several ways, importantly—in the current context—by appropriating a larger share of the natural resource rent.

Keywords: Policy space; Fiscal space; International trade and investment treaties; Investor-state dispute settlement mechanism; Natural resource rents; International financial architecture; Tax reform; WTO (search for similar items in EconPapers)
Date: 2026
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Persistent link: https://EconPapers.repec.org/RePEc:pal:pslchp:978-3-032-08588-7_3

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DOI: 10.1007/978-3-032-08588-7_3

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