I study the global and country level distributional implications of green industrial policy. Using a novel high-frequency instrument —constructed from industrial policy announcements —I identify a structural shock and trace its dynamic effects. I find that the shock can stimulate world industrial production and low-carbon innovation, whilst leading to a front-loading of global oil production and investments – a mechanism consistent with the green paradox. Despite the positive aggregate effects, the consequences of the shock are unevenly distributed across and within countries. Economies more dependent on oil rents experience deteriorating fiscal positions, weaker output, and higher credit risk. Additionally, using micro data, I further demonstrate that the shock can have significant distributional consequences, with households and firms more exposed to the oil sector experiencing substantially larger losses in income and revenue, respectively. Finally, I develop an open economy sovereign default model with nominal rigidities and reserve accumulation, in order to study the adjustment mechanisms and counter-factual policies.