A window of opportunity: five ways IFIs can support the transition to green steel in emerging and developing economies

The policy brief argues that the 2020s represent a critical window for International Finance Institutions (IFIs) to prevent emerging economies—particularly India, Nigeria, Pakistan, and Indonesia—from locking in high-carbon steel capacity. It proposes five intervention areas: providing policy knowledge, facilitating green hydrogen roadmaps, de-risking first-mover investments (including SMEs), utilizing green procurement in IFI operations, and scaling scrap-based circular production to reach a target of 50% of global output.

• There is a critical window in the 2020s to accelerate the transition to green steel to prevent a 15-25 year lock-in of high-polluting assets. This is particularly urgent as the steel sector currently contributes 11% of global CO2 emissions and a significant gap exists between planned carbon-intensive and low-carbon capacity.
• Global steel production is shifting toward emerging economies, with the largest production increases expected in India, Nigeria, Pakistan, and Indonesia by 2030. While most low-carbon primary production projects are currently in China and high-income countries, emerging economies are largely planning high-carbon capacity additions.
• International Finance Institutions (IFIs) can support the green steel transition through five primary mechanisms: acting as knowledge partners for policy frameworks, supporting green hydrogen roadmaps, de-risking and financing first movers (including SMEs and utility-scale renewables), implementing green procurement standards in their own operations, and supporting circular business models for scrap-based production.
• To meet transition goals, global scrap-based steel production must increase from 25% to 50% of total production. This secondary production is identified as a strong fit for IFI priorities due to its location in developing regions and clear climate benefits.

APA

Stockholm Environment Institute (n.d.). A window of opportunity: five ways IFIs can support the transition to green steel in emerging and developing economies. https://www.sei.org/wp-content/uploads/2022/11/2210b-ifis-and-steel-transition-leadit-cop-pb-201025-lhv1.pdf

Chicago

Stockholm Environment Institute. A window of opportunity: five ways IFIs can support the transition to green steel in emerging and developing economies. n.d. https://www.sei.org/wp-content/uploads/2022/11/2210b-ifis-and-steel-transition-leadit-cop-pb-201025-lhv1.pdf.

Wikipedia

{{cite report |author=Stockholm Environment Institute |title=A window of opportunity: five ways IFIs can support the transition to green steel in emerging and developing economies |url=https://www.sei.org/wp-content/uploads/2022/11/2210b-ifis-and-steel-transition-leadit-cop-pb-201025-lhv1.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{stockholmenvironmentinstitutendwindow, author = {{Stockholm Environment Institute}}, title = {{A window of opportunity: five ways IFIs can support the transition to green steel in emerging and developing economies}}, institution = {Stockholm Environment Institute}, url = {https://www.sei.org/wp-content/uploads/2022/11/2210b-ifis-and-steel-transition-leadit-cop-pb-201025-lhv1.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }