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Moody’s says US$4 trillion of global debt exposed to risks

Tan KW
Publish date: Thu, 30 Nov 2023, 11:36 AM
Tan KW
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NEW YORK: The amount of debt facing heightened exposure to environmental risks has more than doubled to over US$4 trillion in less than a decade, according to Moody’s Investors Service.

A total of 16 sectors currently faced “high or very high environmental credit risk,” compared to just nine sectors in 2015, Moody’s said in a report.

Among the most exposed include oil and gas, mining and chemicals, according to the report.

The ratings provider explored the potential credit impact from environmental pressures - including climate change, waste and pollution - on 90 sectors accounting for US$82 trillion of debt.

“A range of global sectors will see their ability to pay their debts exposed to potentially greater risk from rising sea levels, hurricanes, carbon emissions, pollution, threats to biodiversity, and other environmental pressures,” Moody’s said.

The corporate finance segment accounts for the bulk of debt facing high environmental credit risk, with companies in the oil and gas industry accounting for about US$1.7 trillion of the US$4 trillion figure.

Chemicals represent about US$594bil.

 - Bloomberg

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