A Very British industrial policy: Green finance and the City-Bank-Treasury control of Net Zero

Abstract

In 2017, the UK’s Industrial Strategy was thought to have marked an unconventional moment in British politics, as the state began to explicitly ‘pick the winners’ necessary to both grow and decarbonise the economy. This article demonstrates that a more conventional view of this moment can be found in the pages of the Green Finance Strategies where, contrary to the assumption that a green transformation requires developing domestic capacity in emergent technologies, the UK has instead chosen to be the financier of them. It draws on a novel dataset to find another instance of ‘Treasury Control’, in which large scale investments in low carbon sectors was eschewed to instead 'green' the financial expertise located in the City of London, thereby making green finance British industrial policy. Instead of any industrial transformation of the UK political economy, the pursuit of green finance belies the fact that any such transition, and by extension Net Zero, is shaped by the City-Bank-Treasury nexus' desire to preserve the prevailing economic model with as few adjustments as possible.