PROJECT DESCRIPTION
The ecological transition is a unique type of structural change: green industries grow while greenhouse gas-intensive and non-green industries decline. This complex process affects the productive, trade and financial structure of national economies, which can generate transition risks. These risks arise from the dependence of economies on high greenhouse gas emitting industries, which constrains their low-carbon transition: External risk: if a country depends on greenhouse gas-intensive industries as a source of foreign exchange, the transition will affect its balance of payments and the country's ability to import goods and services (including the machinery and inputs needed for the transition); Fiscal risk: if a country relies on emission-intensive industries as a source of tax revenue, the transition will reduce its budgetary resources, which are needed for public investments relevant to the transition (green infrastructure, social spending...); Socio-economic risk: if a country relies on emission-intensive industries as a source of employment, the transition will lead to the destruction of jobs in certain sectors, making targeted measures necessary (social protection, training, etc.). However, not all countries are equal in the face of the ecological transition: they are affected differently by these changes, depending on the structure of their economy and their trade relations with other economies. The ESTEEM model has been developed to identify and better understand these risks, so as to be able to define the most appropriate trajectory for each country.
ADDITIONAL INFORMATION
The project focuses on developing a tool to assess carbonization in industries. The project closing date is listed as 31 December 2050, as the official closing date had not been announced on the project’s website as of March 2025. For more information, visit https//www.afd.fr/en/carte-des-projets/esteem-exposure-structural-transition-ecological-economic-model