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In its Guidance, Treasury advocates for MDB investments prioritizing clean energy, innovation, and energy efficiency, which will help achieve a clean and sustainable future consistent with the development goals of the Paris Agreement. U.S. Secretary of the Treasury Janet L. Yellen previewed Treasury’s MDB Guidance at the April 2021 G7 Leaders Summit on Climate and more recently discussed this with Heads of the MDBs in July 2021.  

“Today, the United States takes bold, proactive steps to address the climate crisis by working with our international partners to establish a clear path to end Multilateral Development Banks’ support for fossil fuels except in exceptional circumstances while helping developing countries build a strong and sustainable future,” said Secretary Yellen.  

Addressing the climate crisis is no longer business as usual and requires significant investments in clean energy. As the largest shareholder across the MDB system, the United States takes a leadership role with the new Treasury Guidance that advocates for MDB staff to assess options for clean energy, innovation, and energy efficiency, and to only consider fossil fuels if less carbon-intensive options are unfeasible. The Guidance advocates for non-fossil fuel energy projects financed by the MDBs, while maintaining some flexibility for developing countries to support limited fossil fuel projects critical to their development objectives if certain criteria are met. 

During the July meeting with MDB Heads, Secretary Yellen requested MDBs to rapidly align MDB portfolios with the Paris Agreement, prioritize innovation and impact to match the scale of the climate crisis, develop ambitious capital mobilization rates consistent with broader climate goals, develop targets for green bonds, “green” the partnerships with financial intermediaries, double the current $40 billion pledge for private sector financing focused upon climate adaptation, and align policy based operations with climate goals. The Treasury Guidance will help MDBs meet these targets.

By ending its support for direct investment in coal and oil projects and encouraging cleaner energy options, Treasury’s Guidance supports poor and vulnerable countries, conflict-affected states, and small-island developing states in meeting their development goals while applying rigorous standards to reduce overall emissions and achieve the goals of the Paris Agreement. The United States looks forward to working with MDB shareholders, Management, and staff to bring clean and sustainable energy to the developing world.

In response to President Biden's Executive Order 14008 on Climate, Treasury issued this Guidance on August 16, 2021. 

Fossil-Fuel-Energy-Guidance-for-the-Multilateral-Development-Banks.pdf

Treasury Guidance on Fossil Fuel Energy at the Multilateral Development Banks 

Amidst a historic global crisis, the Biden Administration’s first budget request reflects its commitment to U.S. global leadership and multilateralism. According to the World Bank, the coronavirus crisis, which shows no signs of abating in the developing world, threatens to push 150 million people into extreme poverty by the end of 2021 and reverse decades of developmental progress. For many developing economies, International Financial Institutions (IFIs) like the International Monetary Fund (IMF) and World Bank are a critical lifeline, providing invaluable resources and support. The Administration’s ambitious budget request constitutes a vital commitment to these institutions and their essential role in rebuilding the world economy.

The budget request includes $63.7 billion for the International Affairs Budget, an 11% increase compared to the FY21 enacted level. Of that, $3.3 billion is requested for Treasury International Programs, a $1.4 billion or 73% increase from the FY21 enacted level. Much of the requested increase in Treasury International Programs is to support the International Financial Institutions. Below, we outline what has been requested for the IFIs and related multilateral initiatives and describe how the money would be spent if appropriated.

The Biden Administration requested $102 million to support the International Monetary Fund’s Poverty Reduction and Growth Trust (PRGT) or another IMF lending facility.

As much as $100 million would be used as a grant to the PRGT, the first direct contribution to the Trust in U.S. history, or another IMF facility. By offering subsidized loans to the world’s poorest countries, the PRGT has helped countries respond to the pandemic and prevent deep economic depressions. 

$2 million or more would be used to cover the subsidy cost of loans of up to 15 billion (roughly $22 billion) Special Drawing Rights (SDRs) from Treasury’s Exchange Stabilization Fund to the PRGT or other IMF trust funds. The details of this loan have not yet been defined. The U.S. currently holds approximately 36.8 billion SDRs, an IMF reserve asset that can be exchanged for usable currency.

The Administration has requested $1.634 billion to support the World Bank.

$1.428 billion has been requested to support the International Development Association (IDA), the World Bank’s concessional lending window for low-income countries. Consistent with FY21 enacted levels, $1.01 billion of this covers the second of three contributions the U.S. committed under IDA’s last triennial replenishment exercise. The remaining $426.6 million would eliminate U.S. arrears – unmet contribution commitments that the U.S. government has made during IDA replenishments. (U.S. arrears to IDA’s Multilateral Debt Relief Initiative would remain $1.504 billion.) Throughout the coronavirus crisis, IDA has helped the world’s 74 poorest countries access vaccines, protect the poor and vulnerable, create new jobs, and strengthen policies and institutions to enable sustainable growth.

The Biden Administration’s budget request also supports the World Bank by waiving Securities and Exchange Commission registration requirements for IDA. Registration requirements increase the cost to IDA of issuing securities in U.S. capital markets and have been waived for all other multilateral development banks. Waiving registration puts IDA on a par with other IFIs and lowers IDA’s borrowing costs, increasing the resources available to the world’s poorest countries.

$206.5 million would go to the International Bank for Reconstruction and Development (IBRD), the World Bank’s vehicle for lending to middle-income and creditworthy low-income countries. This is consistent with FY21 enacted levels and represents the third of six payments committed by the U.S. during the IBRD’s last capital increase. IBRD funding has helped countries like Colombia, Indonesia, Jordan, and Ukraine reduce poverty, achieve sustainable development, and respond to crises like the coronavirus pandemic.

Other International Financial Institutions

The Administration has requested $361.9 million for other International Financial Institutions, including the African Development Bank, African Development Fund, Asian Development Fund, and International Fund for Agricultural Development.

The Administration requested $54.6 million for the African Development Bank (AfDB), the second of eight payments for the AfDB’s seventh capital increase. This is consistent with FY21 enacted level. The AfDB provides loans to the public and private sectors in Africa, a majority of which have supported pandemic response initiatives.  

$211 million would support the African Development Fund (ADF), the AfDB’s concessional lending window. Consistent with the FY21 enacted level, the U.S. would deliver a payment of $171 million per its commitment under the ADF’s recent replenishment. $40 million would be used to reduce arrears to the ADF. The ADF provides grants and low-cost loans to least developed countries in Africa, many of which are fragile states in need of inexpensive financing to achieve stability and sustainable growth.

$53.3 million would support the Asian Development Fund, the Asian Development Bank’s lending vehicle for low-income countries. This represents a $5.9 million increase over FY21. $43.6 million would cover current U.S. commitments and $9.7 million would reduce U.S. arrears. The Asian Development Fund provides grants to the poorest countries in Asia and the Pacific to support water, energy, financial sector development, agriculture, and health projects.

$43 million would constitute the first of three installments towards the International Fund for Agricultural Development (IFAD)replenishment. This represents a $10 million increase over FY21 enacted levels. IFAD supports rural economic development, including in conflict-afflicted and fragile environments, by boosting farmers’ agricultural productivity, incomes, and access to markets.

Along with the International Financial Institutions, the Biden Administration’s budget request includes support for a range of other multilateral initiatives, particularly related to climate change, environmental conservation, and sovereign debt relief.  

The Administration has requested $1.699 billion to support international climate and environment funds, including the Green Climate Fund, Clean Technology Fund, and Global Environment Facility. The Administration has also requested $67 million for bilateral debt restructuring and relief.

$1.25 billion (of which half was requested by Treasury and half by State) would be contributed to the Green Climate Fund (GCF). The U.S. has not contributed to the GCF since 2017. The GCF works through the IFIs and other channels to support initiatives to lower greenhouse gas emissions and promote climate resilience in low-income countries.

$300 million would be contributed to the Clean Technology Fund (CTF). The U.S. has not contributed to the CTF since 2017. The U.S. would provide the CTF with a $30 million grant, and the remaining $270 million would be used to subsidize a loan to the CTF's Accelerating Coal Transitions Investment Program. The CTF catalyzes private and public investment in low-income countries to cover the cost difference between clean-energy technologies and dirtier ones. 

$149.3 million would be contributed to the Global Environment Facility (GEF), a $9.7 million increase over the FY21 enacted level. $12.7 million of this would be used to reduce U.S. arrears to the GEF. The GEF is one the largest global funders dedicated to environmental issues like land degradation, biodiversity, chemicals and waste, and more.

$67 million would be used to provide poor countries with debt restructuring and relief. Of that, $52 million would provide poor bilateral borrowers with debt relief consistent with two G20 initiatives, the Debt Service Suspension Initiative and the Common Framework for Debt Treatments, that were designed to ensure that all G20 members offer debtor countries comparable relief. $15 million would be used to support debt-for-nature swaps in which developing countries with outstanding debts to the U.S. redirect payments to support forest and coral reef conservation efforts.

Analyzing the Biden Administration's FY22 Budget Request

Amidst a historic global crisis, the Biden Administration’s first budget request reflects its commitment to U.S. global leadership and multilateralism.

The Biden Administration's FY22 Budget Request for the IFIs

The climate crisis represents an existential threat to the security and prosperity of communities in the United States and around the world. At the same time, responding to the climate crisis offers one of the greatest opportunities in history for innovation, sustainable economic growth, and the creation of high-quality jobs. This is why the Biden-Harris Administration has made tackling the climate crisis in the United States and abroad a top priority. 

Enabling bold action to reduce emissions and build resilience against the impacts of climate change will require mobilizing and aligning finance at scale. President Biden’s Executive Order on Tackling the Climate Crisis at Home and Abroad (E.O. 14008, signed January 27, 2021) called for the preparation of a Climate Finance Plan (herein “Plan”). This Plan—the first of its kind in the U.S. government—focuses specifically on international climate finance.  The Plan also addresses the need to better align public and private financial flows consistent with what is needed to achieve the Paris Agreement’s temperature and resilient-development goals.

The climate crisis represents an existential threat to the security and prosperity of communities in the United States and around the world. At the same time, responding to the climate crisis offers one of the greatest opportunities in history for innovation, sustainable economic growth, and the creation of high-quality jobs. This is why the Biden-Harris Administration has made tackling the climate crisis in the United States and abroad a top priority.

U.S.-International-Climate-Finance-Plan-4.22.21-Updated-Spacing.pdf

Dear Colleagues:
For more than a year the global community has faced a historic challenge from the dual health and economic crises caused by the pandemic. COVID-19 does not have a nationality nor respect borders, and we continue to see its devastating impact on the health and well-being of our people, our economies, and the social fabric of our societies.

No one nation alone can declare victory over these crises. Indeed, our cooperation has never mattered more. This is a moment made for action and for multilateralism.

Our first task must be stopping the virus. Containing the pandemic across the globe is paramount to a robust economic recovery. The United States is committed to an effective and comprehensive vaccine campaign for our own population. But we are also focused on a global immunization campaign. Without access to vaccines, low-income countries in particular will experience further tragic loss of life and needlessly delay their economic recoveries. We support multilateral efforts like the Access to COVID-19 Tools Accelerator initiative and its COVAX Facility to deliver vaccines to all parts of the world. I urge 020 countries to increase their support to meet the high, unmet needs of these initiatives. A rapid and truly global vaccination program is the strongest stimulus we can provide to the global economy.

Our response to the global economic crisis should be coordinated in a similar fashion. We must continue to provide economic support to our citizens, creating a bridge to the end of the pandemic and rebuilding our economies to be stronger and more inclusive. To this end, the Biden-Harris Administration has proposed another fiscal package to provide much-needed support to families, small businesses, and local communities. Our monetary authorities have done their part with global interest rates at historic lows. I urge G20 countries to continue to take significant fiscal and financial policy actions and avoid withdrawing support too early. If there was ever a time to go big, this is the moment. In addition, we must make sure that the benefits of international trade and investment are realized by all our workers and consumers. Together, our efforts will be greater than the sum of our individual responses. Together, we can build a better, stronger, more even global recovery.

Low-income countries have been particularly hard hit and face limited policy options to respond to the health and economic crises. Without further international action to support low-income countries, we risk a dangerous and permanent divergence in the global economy. International financial institutions, like the IMF and World Bank Group, have provided much-needed emergency support. They must continue to play a role in financing the global health response, supporting a green recovery, and addressing the debt vulnerabilities exposed by the crisis. We look forward to exploring ways to further strengthen their toolkits, including the World Bank and
 
IMF's concessional facilities. The G20's Common Framework for Debt Treatments is an important step, though its effective implementation to support countries in addressing debt burdens will be the true multilateral achievement. I encourage the G20 to finalize a debt data reconciliation process, as transparent and comprehensive debt data will help promote sustainable growth.

An allocation of new Special Drawing Rights (SDRs) at the IMF could enhance liquidity for low-income countries to facilitate their much-needed health and economic recovery efforts. To
make this tool effective, the G20 must work with a broad coalition of countries on a set of shared parameters for greater transparency and accountability in how SDRs are exchanged and used.
We would also strongly encourage G20 members to channel excess SDRs in support ofrecovery efforts in low-income countries, alongside continued bilateral financing. We look forward to discussing potential modalities for deploying SDRs.

The pandemic has moved much of work and life online. We must invest in efforts to help people adapt to this increasingly digital world. The 020 should continue to support work on digital payments at the Financial Stability Board and standard-setting bodies. I believe we can improve the speed and efficiency of our payment systems while mitigating potential risks, including their use for malign and illegal activities. As we know, the changing global economy presents new challenges for corporate taxation. The United States is committed to the multilateral discussions on both pillars within the OECD/G20 Inclusive Framework, overcoming existing disagreements, and finding workable solutions in a fair and judicious manner.

Finally, COVID-19 has once again shown us the need for better global cooperation to address the existential threat of our time: climate change. The United States will work closely with the G20 as we prepare for COP26 and beyond. I am pleased that the U.S. Treasury will co-chair the relaunched G20 sustainable finance group, which we propose to elevate to a working group to reflect its importance. This group will advance and coordinate the 020's initiatives to promote transparency around climate-related financial risks, sustainable finance, and a strong, green recovery. As policymakers of leading economies, we must have frank, open, and sometimes difficult discussions about how to share the burdens and opportunities of transitioning our economies toward a more sustainable, equitable, and prosperous future. While we address the difficulties transitioning our own economies, we should also support low-income countries as they pursue their climate goals, balanced with their development objectives. A truly collective and multilateral response is the only realistic solution to this global challenge.

The G20 was created out of the need for international cooperation in the face of a deep, extraordinary economic crisis. We have come together to face great challenges in the past. We must do so again. I look forward to re-joining you in my new position as we work together over the coming year and into the future.

On February 25, 2021, Treasury Secretary Janet L. Yellen sent a letter to her G20 colleagues calling for a new allocation of Special Drawing Rights (SDRs).

Secretary_Yellen_G20_Letter.pdf

Letter from Treasury Secretary Janet L. Yellen to G20 Colleagues

SECRETARY BLINKEN:  Good morning.  My fellow Americans, five weeks ago I was sworn in as your Secretary of State.  My job is to represent the United States to the world, to fight for the interests and values of the American people.  When President Biden asked me to serve, he made sure that I understood that my job is to deliver for you – to make your lives more secure, create opportunity for you and your families, and tackle the global crises that are increasingly shaping your futures.

I take this responsibility very seriously.  And an important part of the job is speaking to you about what we’re doing and why.

Later today, President Biden will share what’s called the “interim strategic guidance” on our national security and foreign policy.  It gives initial direction to our national security agencies so that they can get to work right away while we keep developing a more in-depth national security strategy over the next several months.  The interim guidance lays out the global landscape as the Biden administration sees it, explains the priorities of our foreign policy – and specifically how we will renew America’s strength to meet the challenges and seize the opportunities of our time.

So for this – my first major speech as Secretary – I’m going to walk through – walk you through how American diplomacy will carry out the President’s strategy.  If we do our jobs right, you’ll be able to check our work – to see the links between what we’re doing around the world and the goals and values I’ll lay out today.

I know that foreign policy can sometimes feel disconnected from our daily lives.  It’s either all about major threats – like pandemics, terrorism – or it fades from view.

That’s in part because it’s often about people and events on the other side of the world, and it’s about things you don’t see – like crises stopped before they start, or negotiations that happen out of sight.

But it’s also because those of us who conduct foreign policy haven’t always done a good job connecting it to the needs and aspirations of the American people.  As a result, for some time now Americans have been asking tough but fair questions about what we’re doing, how we’re leading – indeed, whether we should be leading at all.

With this in mind, we’ve set the foreign policy priorities for the Biden administration by asking a few simple questions:

What will our foreign policy mean for American workers and their families?

What do we need to do around the world to make us stronger here at home?

And what do we need to do at home to make us stronger in the world?

The answers to these questions aren’t the same as they were in 2017 or 2009.  Yes, many of us serving in the Biden administration also proudly served President Obama – including President Biden.  And we did a great deal of good work to restore America’s leadership in the world; to achieve hard-won diplomatic breakthroughs, like the deal that stopped Iran from producing a nuclear weapon; and to bring the world together to tackle climate change.  Our foreign policy fit the moment, as any good strategy should.

But this is a different time, so our strategy and approach are different.  We’re not simply picking up where we left off, as if the past four years didn’t happen.  We’re looking at the world with fresh eyes.

Having said that, while the times have changed, some principles are enduring.

One is that American leadership and engagement matter.  We’re hearing this now from our friends.  They’re glad we’re back.  Whether we like it or not, the world does not organize itself.  When the U.S. pulls back, one of two things is likely to happen: either another country tries to take our place, but not in a way that advances our interests and values; or, maybe just as bad, no one steps up, and then we get chaos and all the dangers it creates.  Either way, that’s not good for America.

Another enduring principle is that we need countries to cooperate, now more than ever.  Not a single global challenge that affects your lives can be met by any one nation acting alone – not even one as powerful as the United States.  And there is no wall high enough or strong enough to hold back the changes transforming our world.

That’s where the institution I’m privileged to lead comes in.  It’s the role of the State Department – and America’s diplomats and development workers – to engage around the world and build that cooperation.

President Biden has pledged to lead with diplomacy because it’s the best way to deal with today’s challenges. At the same time, we’ll make sure that we continue to have the world’s most powerful armed forces.  Our ability to be effective diplomats depends in no small measure on the strength of our military.

And in everything we do, we’ll look not only to make progress on short-term problems, but also to address their root causes and lay the groundwork for our long-term strength.  As the President says, to not only build back, but build back better.

First, we will stop COVID-19 and strengthen global health security.

The pandemic has defined lives – our lives – for more than a year.  To beat it back, we need governments, scientists, businesses, and communities around the world working together.  None of us will be fully safe until the majority of the world is immune because as long as the virus is replicating, it could mutate into new strains that find their way back to America.  So we need to work closely with partners to keep the global vaccination effort moving forward.

At the same time, we need to make sure we learn the right lessons and make the right investments in global health security, including tools to predict, prevent, and stop pandemics, and a firm global commitment to share accurate and timely information, so that a crisis like this never happens again.

Second, we will turn around the economic crisis and build a more stable, inclusive global economy.

The pandemic has caused unemployment to surge around the world.  Nearly every country on earth is now in a recession.  The pandemic also laid bare inequalities that have defined life for millions of Americans for a long time.  So we’ve got a double challenge:  to protect Americans from a lengthy downturn, and to make sure the global economy delivers security and opportunity for as many Americans as possible in the long term.

To do that, we need to pass the right policies at home, like the relief package the President is pushing hard for right now, while working to manage the global economy so it truly benefits the American people.  And by that, I don’t just mean a bigger GDP or a rising stock market; for many American households, those measures don’t mean much.  I mean good jobs, good incomes, and lower household costs for American workers and their families.

We’re building on hard lessons learned.  Some of us previously argued for free trade agreements because we believed Americans would broadly share in the economic gains that those – and that those deals would shape the global economy in ways that we wanted.  We had good reasons to think those things.  But we didn’t do enough to understand who would be negatively affected and what would be needed to adequately offset their pain, or to enforce agreements that were already on the books and help more workers and small businesses fully benefit from them.

Our approach now will be different.  We will fight for every American job and for the rights, protections, and interests of all American workers.  We will use every tool to stop countries from stealing our intellectual property or manipulating their currencies to get an unfair advantage.  We will fight corruption, which stacks the deck against us.  And our trade policies will need to answer very clearly how they will grow the American middle class, create new and better jobs, and benefit all Americans, not only those for whom the economy is already working.

Third, we will renew democracy, because it’s under threat.

A new report from the independent watchdog group Freedom House is sobering.  Authoritarianism and nationalism are on the rise around the world.  Governments are becoming less transparent and have lost the trust of the people.  Elections are increasingly flashpoints for violence.  Corruption is growing.  And the pandemic has accelerated many of these trends.

But the erosion of democracy is not only happening in other places.  It’s also happening here in the United States.  Disinformation is rampant here.  Structural racism and inequality make life worse for millions.  Our elected leaders were targeted in the violent siege of the Capitol just two months ago.  And more broadly, Americans are increasingly polarized – and the institutions that exist to help us manage our differences, so our democracy can continue to function, are under strain.

Shoring up our democracy is a foreign policy imperative.  Otherwise, we play right into the hands of adversaries and competitors like Russia and China, who seize every opportunity to sow doubts about the strength of our democracy.  We shouldn’t be making their jobs easier.

I take heart from the fact that we’re dealing with our struggles out in the open.  And that sets us apart from many other countries.  We don’t ignore our failures and shortcomings or try sweep them under the rug and pretend they don’t exist.  We confront them for the world to see.  It’s painful.  Sometimes it’s ugly.  But it’s how we make progress.

Still, there’s no question that our democracy is fragile.  People around the world have seen that.  Many recognize in our challenges the challenges that they’re facing.  And now they’re watching us because they want to see whether our democracy is resilient, whether we can rise to the challenge here at home.  That will be the foundation for our legitimacy in defending democracy around the world for years to come.

Why does that matter?  Because strong democracies are more stable, more open, better partners to us, more committed to human rights, less prone to conflict, and more dependable markets for our goods and services.  When democracies are weak, governments can’t deliver for their people or a country becomes so polarized that it’s hard for anything to get done, they become more vulnerable to extremist movements from the inside and to interference from the outside.  And they become less reliable partners to the United States.  None of that is in our national interest.

The more we and other democracies can show the world that we can deliver, not only for our people, but also for each other, the more we can refute the lie that authoritarian countries love to tell, that theirs is the better way to meet people’s fundamental needs and hopes.  It’s on us to prove them wrong.

So the question isn’t if we will support democracy around the world, but how.

We will use the power of our example.  We will encourage others to make key reforms, overturn bad laws, fight corruption, and stop unjust practices.  We will incentivize democratic behavior.

But we will not promote democracy through costly military interventions or by attempting to overthrow authoritarian regimes by force.  We have tried these tactics in the past.  However well intentioned, they haven’t worked.  They’ve given democracy promotion a bad name, and they’ve lost the confidence of the American people.  We will do things differently.

Fourth, we will work to create a humane and effective immigration system.

Strong borders are fundamental to our national security, and laws are the bedrock of our democracy.  But we also need a diplomatic, and just plain decent, solution to the fact that year after year, people from other countries risk everything to try to make it here.  We need to address the root causes that drive so many people to flee their homes.  And so we’ll work closely with other countries, especially our neighbors in Central America, to help them deliver better physical security and economic opportunity so people don’t feel like migrating is the only way out and up.

As we do this work, we will not lose sight of our core principles.  Cruelty, especially to children, is unacceptable.  And turning our backs on some of the most vulnerable people on earth is not who we should ever be.

One of the most important pieces of our national identity is that we are a country of immigrants.  We’re made stronger by the fact that hardworking people come here to go to school, start businesses, enrich our communities.  We’ve gotten away from that part of ourselves in the past few years.  We’ve got to get back to it.

Fifth, we will revitalize our ties with our allies and partners.  Our alliances are what the military calls force multipliers.  They’re our unique asset.  We get so much more done with them than we could without them.  So we’re making a big push right now to reconnect with our friends and allies, and to reinvent partnerships that were built years ago so they’re suited to today’s and tomorrow’s challenges.  That includes countries in Europe and Asia that have been our closest friends for decades, as well as old and new partners in Africa, the Middle East, and Latin America.

Over the decades, these commitments have created new markets for our products, new allies to deter aggression, and new partners to help meet global challenges.  We had a name for it: “enlightened self-interest.”  We’ll be clear that real partnership means carrying burdens together, everyone doing their part – not just us.  And whenever we can, we will choose engagement.  Wherever the rules for international security and the global economy are being written, America will be there, and the interests of the American people will be front and center.

We’re always better off at the table, not outside the room.  You should expect nothing less from your government.

Sixth, we will tackle the climate crisis and drive a green energy revolution.  Maybe you live in California, where wildfires get worse every year.  Or the Midwest, where farmland keeps flooding.  Or the Southeast, where communities have been destroyed by stronger and more frequent storms.  The climate crisis is endangering all of us, and costing us more by the month.  We can’t fix it alone.  The United States produces 15 percent of the world’s carbon pollution.  That’s a lot, and we badly need to get that number down.  But even if we brought it down to zero, we wouldn’t solve the crisis, because the rest of the world is producing the other 85 percent.

This is the definition of a problem we need to work together, as a community of nations, to solve.  And we can’t settle for only doing the bare minimum.  We have to challenge ourselves and each other to do more.  While we do, we must also position the United States to thrive and lead in the growing global market for renewable energy.  Wind and solar are the cheapest sources of electricity generation in the world today.  They’re not the industries of the future anymore; the future is now.  And other countries are ahead of us.  We need to turn that around and create millions of good-paying jobs for Americans in renewables.

Seventh, we will secure our leadership in technology.  A global technology revolution is now underway.  The world’s leading powers are racing to develop and deploy new technologies like artificial intelligence and quantum computing that could shape everything about our lives – from where get energy, to how we do our jobs, to how wars are fought.  We want America to maintain our scientific and technological edge, because it’s critical to us thriving in the 21st century economy.

But we know that new technologies aren’t automatically beneficial.  And those who use them don’t always have good intentions.  We need to make sure technologies protect your privacy, make the world safer and healthier, and make democracies more resilient.  That’s where American diplomacy comes in.  We’re going to bring our friends and partners together to shape behavior around emerging technologies and establish guardrails against misuse.

At the same time, we must strengthen our tech defenses and deterrents.  We need only look at SolarWinds, the major hack of U.S. Government networks last year, to see how determined our adversaries are to use technology to undermine us.  Today, safeguarding our national security means investing in our technological capabilities and elevating this issue in our diplomacy and our defense. We will do both.

And eighth, we will manage the biggest geopolitical test of the 21st century: our relationship with China.

Several countries present us with serious challenges, including Russia, Iran, North Korea.  And there are serious crises we have to deal with, including in Yemen, Ethiopia, and Burma.

But the challenge posed by China is different.  China is the only country with the economic, diplomatic, military, and technological power to seriously challenge the stable and open international system – all the rules, values, and relationships that make the world work the way we want it to, because it ultimately serves the interests and reflects the values of the American people.

Our relationship with China will be competitive when it should be, collaborative when it can be, and adversarial when it must be.  The common denominator is the need to engage China from a position of strength.

That requires working with allies and partners, not denigrating them, because our combined weight is much harder for China to ignore.  It requires engaging in diplomacy and in international organizations, because where we have pulled back, China has filled in.  It requires standing up for our values when human rights are abused in Xinjiang or when democracy is trampled in Hong Kong, because if we don’t, China will act with even greater impunity.  And it means investing in American workers, companies, and technologies, and insisting on a level playing field, because when we do, we can out-compete anyone.

These are the eight top foreign policy priorities of the Biden administration.  You may notice some things about that list.

First, important items are not on it.  That doesn’t mean they don’t matter to us or that we won’t work hard on them.  Indeed, I look forward to setting out what we’ll do on other vital pieces of our foreign policy in the days and weeks ahead.

But these priorities – the ones I’ve talked about today – are the most urgent, the ones on which we must make swift and sustained progress.

They’re also all simultaneously domestic and foreign issues.  And we’ve got to approach them that way, or we’ll fall short.  Beating COVID means vaccinating people at home and abroad.  Winning in the global economy means making the right investments at home and pushing back against unfair trading practices by China and others.  Dealing with climate change means investing in resilience and green energy here at home and leading a global effort to reduce carbon pollution.

More than at any other time in my career – maybe in my lifetime – distinctions between domestic and foreign policy have simply fallen away.  Our domestic renewal and our strength in the world are completely entwined. And how we work will reflect that reality.

And finally, as the President has promised, diplomacy – not military action – will always come first.

Again, this is shaped by hard lessons learned.  Americans are rightly wary of prolonged U.S. military interventions abroad.  We’ve seen how they’ve often come at far too high a cost, both to us and to others.  When we look back at the past decades of our military involvement in the world, especially in Afghanistan and the Middle East, we must remember what we’ve learned about the limits of force to build a durable peace; that the day after a major military intervention is always harder than we imagine; and how critical it is to pursue every possible avenue to a diplomatic solution.

Of course, we will never hesitate to use force when American lives and vital interests are at stake.  That’s why President Biden authorized an airstrike last week against Iranian-backed militia groups targeting U.S. and coalition forces in Iraq.  But in that case – and in future cases when we must take military action – we will do so only when the objectives and mission are clear and achievable, consistent with our values and laws, and with the informed consent of the American people.  And we’ll do it together with diplomacy.

Finally, all our priorities go directly to our core sources of national strength.  And we define strength broadly, because a truly strong country is strong in many ways at once.  Real strength isn’t bluster or bullying.  And it’s not based in military power alone.

It’s making sure our most valuable commodity as a nation – our human resources – can meet their full potential.

It’s a flourishing democracy and an innovative and inclusive economy.

It’s the ability to bring countries together because they trust us to lead, and no one can unite others like we can.

It’s having our diplomats walk into buildings around the world and be respected because they have the confidence and trust of the American people.

And it means leading with our values.  That’s what I want to close on today.

At our best, the United States is a country with integrity and a heart.  That’s what makes us proud to be Americans and why so many people around the world have given everything to become Americans.

That includes members of my own family, and many of your families, too.

The Biden administration’s foreign policy will reflect our values.

We will stand firm behind our commitments to human rights, democracy, the rule of law.  And we’ll stand up against injustice toward women and girls, LGBTQI people, religious minorities, and people of all races and ethnicities.  Because all human beings are equal in rights and dignity, no matter where they live or who they are.

We will respect science and data, and we will fight misinformation and disinformation, because the truth is the cornerstone of our democracy.

We’ll work with Congress whenever we can – on the take-off, not just the landing – because they represent the will of our people, and our foreign policy is stronger when the American people support it.

We’ll build a national security workforce that reflects America in all its diversity, because we’re operating in a diverse world, and our diversity is a unique source of strength that few countries can match.  When we don’t have a diverse team, it’s like we’re conducting diplomacy with one arm tied behind our back.  This is a national security imperative and a personal priority for me.

We will bring nonpartisanship back to our foreign policy. There was a time, as the saying goes, when politics stopped at the water’s edge.  Secretaries of State didn’t represent Democrats or Republicans.  We represented all Americans.  Some might think the idea is quaint now.  Well, I don’t.  And the President doesn’t either.

We will balance humility with confidence.  I have always believed they should be the flip sides of America’s leadership coin.  Humility because we aren’t perfect, we don’t have all the answers, and a lot of the world’s problems aren’t mainly about us, even as they affect us.  But confidence because America at its best has a greater ability than any country on Earth to mobilize others for the common good and for the good of our people.

Above all, we’ll hold ourselves accountable to a single, overarching measure of success:  Are we delivering results for you?

Are we making your lives more secure and creating opportunities for your families?  Are we protecting the planet for your children and grandchildren?  Are we honoring your values, and proving worthy of your trust?

It’s the honor of my life to serve as your Secretary of State.  And I’m aware every day that we’re writing the next chapter of our history.  It’s up to us whether the story of this time will be one of peace and prosperity, security and equality; whether we will help more people in more places live in dignity and whether we will leave the United States stronger at home and in the world.

That’s our mission.  That’s our opportunity.  We will not squander it.

We serve the American people.  And we will do everything we can to make you proud.

Speech by Antony J. Blinken, Secretary of State

Policies

Treasury Guidance on Fossil Fuel Energy at the Multilateral Development Banks

The Biden Administration's FY22 Budget Request for the IFIs

U.S. International Climate Finance Plan

Letter from Treasury Secretary Janet L. Yellen to G20 Colleagues

A Foreign Policy for the American People