Home Markets Financial markets are preparing for climate change and so must we

Financial markets are preparing for climate change and so must we

3

Australia’s interest lies in our markets functioning effectively so the financial system remains stable, investors are able to make informed and timely decisions, and capital can be accessed at the lowest possible cost.

Historically, Australia has relied heavily on imported capital to fund our economy. Whether it’s in the form of foreign investment, the stock of which currently stands at $4 trillion, or in the form of wholesale funding of our banking system, with around 20 per cent sourced offshore.

When it comes to Commonwealth government bonds, close to half are held by foreign investors. Reduced access to these capital markets would increase borrowing costs affecting everything from interest rates on home loans and small business loans, to the financial viability of large-scale infrastructure projects. Australia has a lot at stake.

We cannot run the risk that markets falsely assume we are not transitioning in line with the rest of the world. Were…

Click here for full article…www.smh.com.au