The Global Green Bond Initiative is one of the EU's largest financial instruments to fund sustainable infrastructure and climate-related projects with the bloc's partner countries. Its declared aim is to mobilise between €15 and €20 billion in investments.
But European Commission and EU officials are now warning that some of these investments could end up benefiting Chinese companies, undermining Brussels' policy of diversifying away from Beijing in key supply chains.
In practice, the European Investment Bank (EIB) and other European development institutions will act as anchor investors and provide technical assistance for environment-related projects in third countries.
The green bonds may be used to finance solar farms in Algeria, wastewater treatment in India and a light rail line in the Dominican Republic.
Conceived during the previous legislative term as part of the European Green Deal, the governance framework was only finalised in April this year. In the intervening period, the geopolitical landscape has shifted dramatically.
