, which will reach 88 % of gdp in 2011 in both the euro area and the united kingdom, 100 % of gdp in the united states and 200 % of gdp in japan. these developments are the consequence of sizeable fiscal stimulus measures and of interventions in support of financial institutions in many advanced countries, but also of the sharp contraction in economic activity. in the euro area, adverse fiscal developments are a cause of particular concern in several countries, generally those that did not exploit more buoyant economic times to firmly consolidate their public finances. in the united states, too, some states ( e. g. arizona and california ) have adopted a less prudent approach to the management of their public finances than others. there is no doubt that fiscal policies have been put on a path that is not sustainable. indeed, as simulations for the euro area show, without a very ambitious fiscal adjustment effort, the debt ratio is projected to continue rising in the next decades. with an annual structural deficit reduction of only 0. 5 % of gdp, it will take the euro area 20 years or more to return to the pre - crisis debt - to - gdp level. substantially stronger consolidation efforts are warranted to bring the debt ratio down to a more prudent level of below 60 % of gdp and to prepare for the rising budgetary costs of the ageing population. the challenges are particularly large for countries with relatively high government deficit and debt levels, as well as a rapidly ageing society, and even more so for those that face relatively high interest rates and low potential growth. outside the euro area, bringing the public debt ratio back to safer regions appears even harder for the united kingdom, the united states and japan. given their high budget deficits and the high and rising debt levels, they must undertake very strong consolidation efforts to manage a reversal of the rising trend in public debt ratios. growing fiscal imbalances, if not promptly corrected, are a cause of concern for several reasons. let me focus on the three most important ones. first, high levels of government budget deficits and debt may push up inflation expectations and place an additional burden on the monetary policy of central banks and their task of maintaining price stability. second, large fiscal imbalances may drive up ( real ) medium and longer - term interest rates, with adverse consequences for private investment. given the large debt financing needs of many advanced countries, this constitutes a serious risk for the recovery. moreover, rising interest expenditure on government debt reduces the

progress or a stagnation of growth, as long as we can find the right balance between addressing climate change and maintaining socioeconomic development. yes, it would be a difficult, long, and winding journey, but we hope that this two - day forum will contribute to charting the right path through it. here in hong kong, our emissions are very small given our small physical size, but we are committed to doing our part and will aim to achieve zero carbon emissions by 2050 through four main decarbonisation strategies : " net - zero electricity generation, " " energysaving and green buildings, " " green transport, " and " waste reduction ". 1 / 2 bis - central bankers'speeches as an international financial centre, the gateway linking up mainland china with the rest of the world, as well as asia's sustainable finance hub, we can do a lot more in climate finance. in fact, hong kong has been actively contributing to the region's transition by supporting sustainable financing, fostering innovation, and promoting thought leadership. as part of these strategies, the hong kong financial regulators have implemented various initiatives to promote sustainable finance and support the transition to a lowcarbon economy. for example, we have established the green and sustainable finance cross - agency steering group to coordinate the effort across the whole financial sector, whether it is banking, securities, or insurance, to green our financial system. we have also introduced the green and sustainable finance grant scheme to provide financial incentives to eligible bond issuers to take up sustainable financing. we have set up the hong kong voluntary carbon market, and also released new guidelines on climate - related disclosure of climate - risks and opportunities. so a lot has been done and there will be more coming, including the hong kong taxonomy. in 2022, more than one - third of the asia region's green and sustainable bonds and loans were arranged in hong kong, reflecting our increasing prominence in sustainable finance. the annual issuance of green and sustainable debt in hong kong has also seen remarkable growth in the last few years, expanding from just us $ 12 billion in 2020 to more than us $ 80 billion in 2022, a six - fold increase in just two years. our financial industry has taken significant steps to integrate esg considerations into their governance structures, strategic decision - making, risk management practices, and disclosure processes. we are also keen to join hand with like - minded peers like many of you here today. the ifc and hkma have had a