
Private capital flows and climate change:
Maximizing private investment
in developing countries under the Kyoto Protocol
Bradford S. Gentry
Yale/undp Collaborative Program on the Urban Environment
Abstract
For a growing number of decision-makers, understanding and building on the links
between international private capital flows and climate change is an increasingly
critical e≠ort. For developing countries this is true both because (i) private capital is
the primary engine of economic growth and, therefore, of sustainable development,
and (ii) the Kyoto Protocol has the potential to substantially increase private investment in developing countries.
This paper describes the links between private capital flows and environmental
performance. It starts by reviewing the recent history of private capital flows to
emerging markets.The impacts of environmental issues on investor decision-making
are then described. Finally, some initial suggestions are made on ways to integrate
environmental and investment frameworks, including under the Kyoto Protocol –
with particular attention to the Clean Development Mechanism.
Overview
Private capital flows and climate change—what are the links? To some in the environmental community, the question has little meaning because they focus on the
use of public monies—particularly Official Development Assistance () —
when thinking of climate change and developing countries. To others, the answer
is easy because the links are all negative. In their view, increased private investment
means only expanded industrial activity and natural resource exploitation and,
thus, increased emissions of greenhouse gasses and destruction of carbon sinks,
such as rainforests.
For a growing number of decision-makers, however, the question is neither
meaningless nor easy. In fact, it is increasingly regarded as one of the most important questions being asked. From a developing country perspective, understanding the links between private capital flows and climate change is crucial for two
major reasons:
• Private capital is the primary engine of economic growth and therefore must
be recognized as a core driver of sustainable development as well.
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• The Kyoto Protocol has the potential for substantially increasing private
investment in developing countries.
This paper takes an instrumental approach. It does not attempt to address the scientific, ethical, or political issues surrounding the Kyoto Protocol and its flexible
implementation mechanisms. Rather, it assumes a goal of maximizing private
investment in developing countries under the Protocol and proceeds from there.
The paper starts by reviewing the recent history of private capital flows to emerging
markets. The impacts of environmental issues on investor decision-making are then
described. Finally, some initial suggestions are made on approaches to integrating
environmental and investment frameworks, including ways they might be applied to
the Kyoto Protocol. Specific attention is paid to the Clean Development Mechanism.
Why the shift in attention from oda to international private capital flows?
figure 1
Private Capital Flows to Developing Countries vs. oda 1990
through 1999. Source: World
Bank (2000). Global Development Finance 2000. Washington,
D.C. (1999 data is preliminary)
The numbers are stark and speak for themselves. As shown in Figure 1, transfers of
ODA to developing countries averaged around $50 billion per year from 1990
through 1999. At the same time, private investment in developing countries
exploded from under $50 billion in 1990 to a high of over $300 billion in 1997.
Even with recent financial crises, net private capital flows to developing countries were still four to five times larger than official flows in both 1998 and 1999. As
economic recovery picks up pace in many parts of the world, the differential will
only increase.
In general, the shift from  to international private investment as the major
vehicle for resource transfers from industrialized to developing countries is a good
thing. Developing country governments cannot achieve sustainable development
acting alone. They cannot create or provide
all or even a majority of a nation’s capital.
Rather, as discussed below, their role should
be to set and oversee the frameworks for private economic activity, including both
investment and environmental factors.
The shift does not, however, decrease the
importance of effectively applied .
Many developing countries have been left
out of the global flows of private capital.
Between 1990 and 1996, nearly 80% of the
private investment in the developing world
went to three regions: Asia, Latin America,
and Central Europe, and within those, to
twelve countries: Argentina, Brazil, China,
Hungary, India, Indonesia, Korea, Malaysia,
Mexico, Russia, Thailand, and Turkey. While
these countries represent a large percentage
of the world’s total population, they are few in number. Other developing nations
are struggling to increase their share of private flows. Those that have not been
successful to date—particularly in sub-Saharan Africa or parts of South Asia—are
in serious danger of being left further and further behind economically. To the
extent that  can be applied to help more developing countries build their
capacity for attracting a larger share of global private investment—and weather-
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ing the storms inherent therein—it is an appropriate and important use of public
money. This is especially true in the climate change arena, given the historical
roots of the problem in the industrialized countries.
In what ways are the di≠erent forms of international
investment linked to the environment?
International private investment is not all the same—nor are the environmental
effects of the different forms. It is important to distinguish among three major
components of private capital flows: (1) foreign direct investment (); (2) portfolio equity investment; and (3) debt. Each has different links to environmental
performance. Each exhibits different responses to financial crises. Interestingly,
the policy recommendations on how to manage private capital flows coming from
both the environmental and investment communities seem to be converging, with
a focus on predictable and effective legal frameworks, greater access to information, and strategically applied public investment.
Foreign direct investment
As shown in Figure 2,  is the largest and most durable component of private
capital flows to developing countries. Typical  is investment by a multinational
company—either from an industrialized or a developing country—in a local company, either wholly owned or through a joint venture.  occurs in many sectors,
including resource extraction, manufacturing, infrastructure, and banking. Preliminary data from 1999 suggests that 
made up 80% of all foreign investment in
developing countries. The total amount of
 going to developing countries is
expected to continue to grow in the future.
 also has the most direct links to
environmental performance, as it often
goes into production operations. Environmental damage can result from increased
land use, increased pollutant loads, and the
secondary effects of expanded production
(i.e. along transportation corridors or in
new settlements). Environmental performance can also be improved, however,
through increased efficiency of raw material use, greater attention to the environmental characteristics of products, and
more effective protection of sensitive areas.
Portfolio equity investment
Portfolio equity investment is at the other end of the spectrum, having been the
smallest and one of the more volatile components of private capital flows to developing countries, with the least direct—but still critical—links to the environment.
It consists of publicly traded ownership shares in private companies, often
referred to as stock. While portfolio equity investment in developing countries
increased rapidly in the early and mid 1990s, its percentage share dropped
markedly before starting a recent recovery.
figure 2
Flows of fdi, Portfolio Equity, and
Debt to Developing Countries
1990 to 1999. Source: World Bank
(2000). Global Development
Finance 2000. Washington, D.C.
(1999 data is preliminary).
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Many developing countries have been left out of the global flows of private capital. Between 1990 and 1996, nearly 80% of the private investment in the developing world went to three regions: Asia, Latin America, and Central Europe, and
within those, to twelve countries: Argentina, Brazil, China, Hungary, India,
Indonesia, Korea, Malaysia, Mexico, Russia, Thailand, and Turkey.
The links between portfolio equity investments and environmental performance are less clear and more complex than those for . Initial public offerings
of shares in companies () provide new capital to the firms involved, and thus
may act like . Later trades in the secondary markets, such as on stock
exchanges, can help spur economic growth, with good and bad effects on the environment (e.g. greater political pressure for environmental protection versus
increased consumption of environmental resources). Secondary market activity
can also help slow economic growth—for example, through the rapid withdrawals
from developing countries witnessed over the past few years—with good and bad
effects on the environment (reduced consumption versus unsustainable resource
use spurred by economic need).
Yet, the opportunities portfolio flows present as a point of leverage for environmental policy are vast. Worldwide, portfolio flows of both equity and debt
comprise the largest segment of cross-border transactions—55 percent in 1996.
Portfolio equity and debt investors hold the purse strings to more money worldwide than is available from any other type of investment source, dwarfing the
resources potentially available from . For example, according to the IFC, in
1996 the world’s total market capitalization topped U.S.$18 trillion, far in excess of
total global  flows of $320 billion.
Debt
Debt,including both commercial bank lending and portfolio debt instruments (such
as bonds), is the third major component of private capital flows to developing countries. In 1999, it appears to have fallen dramatically from its 1997 high of $103 billion, to a low of $19 billion. Interestingly, during the recent financial crises, commercial bank lending was one of the most volatile of all types of private capital flows.
Many different types of debt instruments exist, from commercial bank loans to
power stations to medium-term bonds issued by large companies. The environmental effects of debt run the gamut from  to portfolio equity. Government
bonds present the greatest mystery in terms of leverage points for affecting their
environmental performance. Some are used to fund improvements in environmental infrastructure. Most, however, go into general government revenues, with
potential investors having essentially no reason to consider the environmental
performance of the underlying government operations.
How does the environment a≠ect investor decision-making –
from risks to opportunities, identifying points of policy leverage?
Since one can find legitimate examples of private investment being both good and
bad for the environment, the critical question is how the opportunities for
improving environmental performance can best be captured.
One set of answers can be developed by understanding and building on the
ways in which environmental factors affect investor decision-making. For ,
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improved environmental performance only happens when it increases the
investors’ commercial advantage. In developing countries, this usually occurs for
one of five major reasons:
• improving access to export markets, such as through the adoption of environmental management systems or the award of product “eco-labels”;
• increasing productivity, through more efficient use of raw materials;
• maintaining a “social license” to operate, in the face of local and international
pressure from neighbors, , shareholders, and customers;
• accessing finance, since international financiers increasingly require environmental risks to be addressed and, in cases such as World Bank loans, separate
environmental guidelines to be met;
• making “environmental” investments, such as in water systems or cleaner
energy production.
These commercial advantages for foreign direct investors provide leverage
points for environmental policy-makers. This is true in both the developing countries receiving the investment and in the countries that are the sources of the
investment, which are usually, but not always, among the industrialized countries.
When considering how best to use the Kyoto Protocol to increase private
investment in developing countries, all of these factors should be considered.
Thoughts on how best to build on these links between private capital flows and
environmental performance are offered in the following sections.
How are opportunities for private investment created
and how does this change the role of government?
The shift to private investment is also changing the role of many governments, as
they move from being the provider of services to being the enabler and overseer
of their provision by private parties. Governments enable private investment by
setting the frameworks within which private economic activity occurs. Governments oversee private investment by monitoring both the frameworks and the private activity, and taking action when either fails to perform.
The basic frameworks for private investment and other market activities
include definitions of various property rights, the manner in which such rights
may be held or transferred, and how any particular rights may be protected. Only
with such basic legal rights in place can private investment flourish. It does so by
taking these basic building blocks and arranging them in a myriad of ways that
increase the value to potential customers. Many of these arrangements change
over time, in ways that are impossible to predict when the underlying property
rights are created.
This combination of flexibility within an overall market framework allows the
creativity of private actors to flourish in ways consistent with societal values. This
is where the policy recommendations of the environmental and investment communities come together. Both want clear, predictable, transparent regulatory
frameworks, consistently applied. Both want to see ODA used to build the capacity of host countries to adopt and maintain such frameworks. Increasingly, it is in
each of their interests to have environmental considerations integrated into
national investment frameworks.
The concept of market frameworks allowing flexible implementation is also
where private investment and the Kyoto Protocol start to come together. One of
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the core roles for governments is to help build demand for private investments,
particularly those with positive environmental content. This means developing
both market frameworks and mechanisms for internalizing environmental costs.
In the context of climate change, setting market frameworks includes defining the
range of property interests that may be traded. Internalizing environmental costs
means creating demand for those property interests by limiting or reducing allowable emissions of greenhouse gases from operations in industrialized countries.
Many developing countries object to the Clean Development Mechanism and
the other “flexible” implementation mechanisms provided in the Kyoto Protocol.
Some do so because of the unfairness of letting industrialized countries “buy their
way out” of a problem they caused. Some are concerned about losing their future
ability to develop by selling their right to use the air today. Still others worry that
any such trading systems will be so complicated that they will be impossible to
administer. These are all serious concerns.
At the same time, many of these countries are actively seeking to attract more
private investment into other parts of their economies, frequently in operations
that exploit other natural resources such as minerals, oil, and timber. Many of the
investors in these operations are from industrialized countries. Many of the products from these operations are consumed in the industrialized world. Governments decide the terms on which to make the resources available to investors,
either directly through concessions or indirectly through regulatory and tax
frameworks. Presumably they do so only when the proposed operations are seen
as beneficial to the local economy or when they help meet other governmental
objectives. Within this context, host country governments may monitor private
activities and take action, should they conclude it is warranted.
A similar conceptual approach is appropriate for any sales of interests in reduced
emissions of greenhouse gases. It is up to the host countries to determine whether
they want to make such property interests available. They should only do so on
terms with which they are comfortable. For example, they might choose to allow
only relatively short-term interests to be developed and sold. Concerns over differences in bargaining power between governments and international investors might
be reduced through efforts to harmonize the types of interests being offered for sale.
Even if a developing country decides to make such investment opportunities
available, however, the details of the  still remain to be understood and negotiated. Some of the issues are scientific—how can the levels of emissions reductions be determined and monitored? Others are legal—how should industrialized
countries that violate their emission reduction commitments be punished?
The focus of this paper, however, is on how to design the  to maximize
opportunities for private investment in developing countries. Some principles for
helping to achieve this goal are suggested in the following section.
How can private investment be maximized through market frameworks
and oversight, rather than through centralized approval processes?
Article 12 of the Kyoto Protocol defines the basic features of the  to include
the following:
• benefits to developing countries from project activities generating emission
reductions;
• use of certified emission reductions () by Annex I countries to meet part
of their emission limitation and reduction commitments;
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193
• development by the Conference of the Parties () and supervision by an
Executive Board;
• certification of eligible emissions reductions by operational entities, including
private and public parties, to be designated by the ;
• certification according to specified requirements, including voluntary participation, as well as real, measurable, and long-term benefits that are additional
to those that would otherwise occur;
• auditing and verification of project activities under rules determined by the
;
• use of a share of the proceeds from  activities to cover administrative
expenses, as well as to contribute to an adaptation fund for particularly vulnerable countries.
Although these basic elements must be included in the , whatever form it
takes, a huge number of critical details have yet to be defined. How they are reflected
in the final structure will make all the difference for the ’ success or failure.
For example, much of the process to date appears to have focused on identifying the government body that will approve the trading rights, and how it will do so.
The quickest way to strangle the ’ potential for increasing private investment in developing countries is to force all transactions through centralized
global, or even national, approval processes. As illustrated in Figure 3, the best way
to maximize the ’ full investment potential is through centralized frameworks for the decentralized generation, transfer, and oversight of emission reduction credits. This approach is also consistent with the core government roles of
defining market frameworks and then overseeing the performance of a myriad of
market actors.
Finding a balance between the need to ensure that the terms of the Protocol are
figure 3
Centralized approvals versus centralized frameworks for decentralized implementation – implications for investment flows.
met and to still leave room for markets to function in a flexible and timely manner
is the key challenge for negotiators. Any effort to develop frameworks for decentralized implementation of the  needs to consider three major components:
• the overarching framework for the ;
• methods for maximizing the generation of certified emission reductions; and
• methods for maximizing the resources transferred with their sale and use.
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Each of these components faces a huge number of issues. Some ideas for negotiators are offered in the following sections.
figure 4
Credits, resources and maximized
private investment.
Building the market framework
The overall structure of the  is the framework within which private investment will occur and be overseen. As illustrated in Figure 4, it starts with the
/ Executive board
defining the rules for granting
credits against emission reduction commitments to Annex I
country governments.
It also requires Annex I governments to put domestic emission reduction requirements in
place and to offer credits against
those requirements for qualifying investments in developing
countries. Until such requirements and credits are in place,
private investors will have only
limited incentives to invest in
.
According to Article 12, the
Annex I country governments
must also provide resources to
the , both for administrative expenses and for the Adaptation Fund. If they do not make the required payments, they will receive no credits. These finances would come, in part, from fees
paid by the users of Certified Emission Reductions (). It could also include
amounts taken from general tax revenues, such as . If participating countries
and/or the  Executive Board wanted to take a larger share of  proceeds
directly, they could also seek to impose a tax on all sales of . How to balance
the additional administrative burden of collecting such a tax with the desire to
allow the markets as many different opportunities as possible for transferring
 is a critical issue for any such taxing mechanism.
The / Executive Board will also set the framework for the creation and
trading of the  among developers, sellers, buyers, and users. Some of the possible features of these activities are shown in Figures 5 and 6 below.
Before moving to these more detailed aspects, however, it is important to
return to the goal described in this paper—maximizing private investment under
the  while meeting the terms of the Protocol. At its core, this means creating
predictable and verifiable frameworks that both allow and promote decentralized
action by a wide range of parties, public and private. Only by allowing such private sector creativity to flourish will the ’ full potential be realized.
Maximizing the generation of cers
For developers and sellers of , this requires workable mechanisms for defining and overseeing the property rights to be traded, leaving as much room as possible for flexibility in how the actual trades are conducted. As shown in Figure 5,

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figure 5
Maximizing the generation of
Certified Emission Reductions.
this can be done through decentralized certification and verification programs
similar to those used under a wide range of international product standards.
The basic features of such a system include both certification and verification
functions. Both start with and provide a vehicle for implementing rules and guidance from the  and the  Executive Board across a wide range of individual transactions. For certification of emissions reductions, those rules are initially
overseen by national accreditation and tracking bodies (possibly using the
national standards organizations already in existence in most countries around
the world). Those national organizations will both accredit certifiers and track
the certifications made through notices and fees submitted by certifiers. Should
a certifier fail to follow the rules, their right to certify would be revoked. Accredited certifiers will be paid by developers (public or private) to review the emission reductions proposed for certification. If they meet the rules set by the
/ Executive board, a certification will be issued and the  may be freely
traded.
Ideally, such trades should be left free to take a wide variety of forms, including:
• sales by developers directly to the ultimate users in Annex I countries (similar
to the  scenario described above);
• sales by developers to brokers and other intermediaries who then locate buyers;
or
• sales to “pools” of credits, shares in which are offered for sale by public or private parties (similar to the portfolio investment scenario described above).
For auditing and verification, a similar basic structure is used, with one major
difference: its primary function is to check samples from the certification process,
not to approve every . Only if problems are found will more extensive investigations be undertaken. International or national bodies can accredit the auditors. They will then conduct periodic audits to verify that the national accreditation bodies and the individual certifiers are performing their functions as
prescribed by the / Executive board. Government inspectors and, possibly, authorized  might also provide a supplemental check on the 
offered for sale.
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The result is a system for maximizing the generation of  that both meet
the requirements of the Protocol and are available for trading in a wide variety of
ways.
Maximizing the opportunities for private investment in cers
Such a result clearly fits the needs of potential buyers and users of the , maximizing the opportunities for private investment and resource transfers to parties
in developing countries. As shown in Figure 6, the money flows two ways under
this structure: first, to the sellers of the  (and then up through the national
certification chain); and second, to the adaptation fund through the Annex I governments. As noted above, other alternatives also exist, such as a tax on each sale
of a .
Buyers of  would pay the market price directly to the sellers, whether they
are developers, intermediaries or pools, public or private. The buyers themselves
may be public or private, pools, intermediaries, or even the final users. Ultimately,
the  will be purchased by those wanting to use them—including Annex I governments and firms needing help meeting their domestic emission reduction
figure 6
Maximizing resource transfers.
requirements, or  and others wanting to force further reductions by taking
the emission rights off the market.
Users of  would then provide notice and pay a fee to an Annex I government in exchange for a credit against domestic requirements. In turn, the Annex I
government would make a contribution to the expenses of the / Executive Board and the Adaptation Fund in exchange for credit against its Protocol
commitments. As with the certification system, the system of using  to meet
domestic emission reduction targets would be overseen by internationally accredited auditors.
What are the potential benefits of centralized frameworks
with decentralized implementation and oversight?
Decentralized implementation and oversight within a centralized framework is
one of the best ways to maximize private investment under the . It maximizes

the opportunities to generate . It maximizes the flexibility among sellers and
buyers. It is founded on the requirements of the Protocol. Adherence to those
requirements is regularly verified.
Will this approach work? It is too early to say. The technical and policy issues
facing the creation and monitoring of emissions reductions still need to be
addressed. Political issues in determining the substance of the certification
requirements, such as the details of the “additionality” rules, still need to be
resolved. Even assuming that an approach along these lines is adopted, the capacity of many governmental and private parties to administer such a system effectively will need to be improved substantially.
What this approach does do is provide a basis for concrete discussions between
developing countries and the private investment community on how the 
might best engage private investment. Until recently, even if a private financial
institution had heard of the  (and many have not), it was viewed as too illdefined or far off to be paid much attention. As more concrete approaches are
developed, particularly those based on current investors’ conduct, these attitudes
are changing and opportunities for dialogue are emerging.
Where is progress being made?
Little progress has yet been made on the  through the formal negotiating
process. At the November 1998 - in Buenos Aires, a two-year period for further study was agreed upon. At the October 1999 - in Bonn, a greater degree
of comfort with the basic concepts was apparent, but no specific agreements were
adopted. The Sixth Conference of Parties, in The Hague in November and December of 2000, will be a critical session for the future of the .
Instead, real progress on the design and implementation of trading mechanisms is being made through a series of experiments by private firms, national
governments, and multilateral organizations. Included are the:
• establishment of internal emission trading programs within multinational
production companies such as BP/Amoco and Shell;
• development of protocols for third-party certification of CO2 emission reductions by firms such as Ecosecurities and ;
production
and sale of carbon offset credits by organizations around the world,
•
from Costa Rica to the State Forests of New South Wales, Australia;
• purchases of carbon offset credits directly by electric power utilities (such as
 Corporation) and indirectly through commodity markets (such as the
Chicago Board of Trade and the Sydney Futures Exchange);
• formation of investment funds specifically designed to invest in carbon rights
such as the World Bank’s Prototype Carbon Fund; and
• design of national CO2 trading programs in countries such as the United Kingdom and Norway.
These “experiments in social learning” are helping to uncover both the obstacles to and the opportunities for converting the theory of emissions trading into
reality on a global scale. They are also starting to provide a concrete foundation
for progress on the overall design of the . These “real world” activities help
flesh out the possible interior of a “decentralized”  mechanism, i.e. the procedures for developing , trading , and maximizing private investment
in  projects (Figures 5 and 6).
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Where should negotiators go from here?
In order to spur more private investment in developing countries, however, governments need to agree on the “centralized” framework for the  within which
specific trades will occur (Figure 4). Industrialized countries need to impose
domestic requirements that enhance the value of  investments in developing
countries. Developing countries need to adopt both general and -specific
frameworks that encourage private investment.
Both industrialized and developing countries need to recognize that it is in
their mutual self-interest to break through the “chicken and egg” question of who
acts first by agreeing to proceed together down the  or similar path. Many specific questions about the  remain to be answered. Efforts to develop those
answers should be undertaken in light of the goal of increasing overall investment,
both public and private, in developing countries.
Negotiators from developing countries should explore and understand the
links between private capital flows and environmental performance, particularly
in considering their position on the . Doing so will provide a solid foundation for deciding whether, and if so on what terms, they want to work on designing the  to help maximize private investment in their countries.
References and suggested readings
Beck, T. “Australia Shows the Way,” Environmental Finance. London, U.K.: Fulton
Publishing, 2000.
Center for Sustainable Development in the Americas. Working Papers on the
. http://www.csdanet.org.
Confederation of British Industry.“UK Emissions Trading Could Start from April
2001—/.” London, U.K.: Press Release, 1999.
Cooper, G. “Shell Steps off the Gas,” Environmental Finance, (February 2000).
Delphi International Ltd. The Role of Financial Institutions in Achieving Sustainable Development. London, U.K.: Report to the European Commission, 1997.
“Norway Unveils Emissions Report,”“Carbon Fund has Japanese Appeal,”“European Emissions Trading Goes to Round Two,” Environmental Finance, (February 2000).
Fernandez, L., B. Gentry, and D. Esty. The Environmental Effects of International
Portfolio Flows and the Actors Who Drive Them. Working Paper. Paris, France:
, 1998.
Ganzi, J., F. Seymour, and S. Buffet. Leverage for the Environment: Strategic Mapping of the Private Financial Services Industry. International Financial Flows
and the Environment Project. Washington, D.C.: World Resources Institute,
1998.
Gentry, B. “Foreign Direct Investment and the Environment: Boon or Bane,” Foreign Direct Investment and the Environment. Paris: , 1999.
——, ed. Private Capital Flows and the Environment: Lessons from Latin America. Aldershot, U.K.: Edward Elgar Press, 1998.
Gutner, T. International Mechanisms Shaping the Environmental Impact of
Transboundary Capital Flows. Washington, D.C.: World Resources Institute,
1998.
Institute for International Finance. Capital Flows to Emerging Market Economies:
September 29, 1998. Washington, D.C.: Institute for International Finance,
1998.

International Finance Corporation. Emerging Stock Markets Factbook. Washington, D.C.: International Finance Corporation, 1996.
International Finance Corporation. Investment Funds in Emerging Markets.
Washington, D.C.: International Finance Corporation, 1996.
Kaplan, M. and J. Mein. Early Start Carbon Emission Reduction Projects: Challenge and Opportunity. Proceedings of the Brazil/U.S. Aspen Global Forum.
Institute for Policy Research and Implementation. Denver, Colorado, U.S.A.:
University of Colorado, 1999.
Pew Center on Global Climate Change. Papers on the . http://www.pewclimate.org.
Schmidheiney, S. and F. Zorraquin. Financing Change: The Financial Community,
Eco-Efficiency and Sustainable Development. Cambridge, Massachusetts,
U.S.A.: MIT Press, 1996.
. Carbon Offset Verification Service. Oxford, U.K.: Oxford Center for Innovation, 1999.
Toman, M. and J. Hourcade. “From Bonn to The Hague, Many Questions
Remain,” Resources (Winter 2000). Washington, D.C.: Resources for the
Future, 2000.
Werksman, J. and J. Cameron. The Clean Development Mechanism: The “Kyoto
Surprise.” Working paper for The Brazil/U.S. Aspen Global Forum, held June
1998, Sao Paulo, Brazil. Washington, D.C.: The Aspen Institute, 1998.
World Bank. Global Development Finance 2000. Washington, D.C.: The World
Bank Group, 2000.
——.“Environment in Crisis: A Step Back or a New Way Forward?,” East Asia: The
Road to Recovery. Washington, D.C.: The World Bank, 1998.
——. Private Capital Flows to Developing Countries: The Road to Financial Integration. Washington, D.C.: The World Bank Group, 1997.
——. “Portfolio Investment Funds—Assessing the Impact on Emerging Markets,”
Public Policy for the Private Sector, September. Washington, D.C.: The World
Bank Group, 1996.
Stuart, M. and L. Fretz. Financial Tools and the Clean Development Mechanism:
A Preliminary Working Paper. Prepared for the International Working Group
of the ,   workshop. Buenos Aires (November 1998),
http://www.ecosecurities.com/, 1998.
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   
Bradford S. Gentry is the director of the research program on Private Investment and
the Environment at the Yale Center for Environmental Law and Policy, the co-director of the Yale/undp Collaborative Program on the Urban Environment, as well as a
lecturer at the Yale School of Forestry and Environmental Studies and the Yale Law
School (visiting). He was in private law practice in Boston and London for 15 years. He
is now Of Counsel to the law firm of Morrison and Foerster. Professor Gentry’s publications include Private Capital Flows and the Environment: Lessons from Latin
America (Edward Elgar, 1998), as well as numerous articles and policy papers.
Yale/undp Collaborative Program on the Urban Environment
Yale Center for Environmental Law and Policy
285 Prospect Street
New Haven, CT 06511
U.S.A.
Tel: +1 203.432.9374
Fax: +1 203.432.9375
Email: partners@yale.edu