The Conflictive Travels of Green Municipal Bonds. Comparative Perspectives on the Expansion of Financial Markets to Southern Cities

This paper traces the work of travelling ideas in the globalization of financial markets and their effects on urban development in Southern cities. Particularly since the financial crisis of 2008, much has been written about the growing influence of finance in the urban development of EuroAmerican cities (Aalbers 2008, 2015; Christophers 2012). Today financial markets also appear to be expanding southwards, into the ‘rising’ cities of Asia, Africa or Latin America (David 2012; Soederberg 2015; Rouanet & Halbert 2016). Empirical research on the influence of global finance in Southern cities remains limited, though.

In this context, we contribute a comparative account of the conflict-ridden integration of Southern cities into global financial economies. More particularly, the paper examines the travels of a novel financial tool, Green Municipal Bonds (GMBs). GMBs are debt instruments that allow cities to raise capital through the issuance of bonds that is solely to be invested in certified sustainable projects. Since the World Bank started issuing GMBs in 2008, the use of this instrument has quickly gained momentum. First employed by European and North American cities, the paper examines its spread to Johannesburg, Mexico City and Delhi, the first Southern municipalities to issue (or prepare the issuance of) GMBs.

Based on the analysis of strategic and legal documents, government reports and preliminary interviews with international advocates, we inquire into the ways in which this travelling policy was introduced, altered and implemented through local policy, but in interactions with global actors in the three case study sites. In particular the paper highlights the role of international Standards Stetting Organisations that work with local governments to certify GMBs, thereby circulate knowledge, foster market transparency, minimize economic risk, and, more broadly transnationalize and privatize regulatory environments.