Seychelles prioritizes climate action in sustainable development

As part of responsibilities to maintain financial stability, Central Bank of Seychelles (CBS) is in a strategic position to support the development of green finance models, thereby aligning finance with sustainable development, said Jenifer Sullivan, the bank’s Second Deputy Governor at the AFI Virtual In-Country Training on Inclusive Green Finance (IGF) co-hosted by the central bank and AFI.

“Climate change presents unique challenges to Small Island Developing States like Seychelles, and its impact is exacerbated due to our small geographical area, relative isolation and exposure,” said Sullivan at the start of the training held on 25 August.

The technical training, especially designed for the staff of CBS, focused on building internal capacity for the development of an action plan that charts the next steps for CBS work in IGF. Key discussion points included understanding the mandate and role of financial regulators with regards to IGF, the various terminologies related to IGF, situating IGF within the broader green finance landscape, as well as identifying major environmental and climate change challenges in Seychelles.

In welcoming the CBS staff to the training, AFI Deputy Executive Director Norbert Mumba remarked that, “both slow and fast onset climate events hamper economic development and impacts the most vulnerable the hardest. At the micro-level, those with limited coping capacities suffer the most impacts of these climate events.”

In response to climate threats, Seychelles has put climate change at the centre of its sustainable development strategy, addressing both mitigation and adaptation measures, while looking at green finance beyond the simpler option of relegating it to sustainable lending.

“We must advocate a holistic approach which includes public policies that promote a green economic transformation towards low carbon, sustainable and inclusive pathways, in close collaboration with all relevant local agencies,” said Sullivan.

Building gender-sensitive capacity and social empowerment at all levels to adequately respond to climate change are some of the long-term targets for Seychelles, according to George Uzice, a Climate Change Negotiator from the Ministry of Environment, Energy and Climate Change.

Uzice added that the island nation is developing policy direction and strategies to encourage and enhance action on technology development and transfer of green technologies, as well as scaling up financial resources and investment to support action on adaptation.

Among policies that have been developed by Seychelles are the Seychelles National Climate Change Strategy (2009), and the Seychelles Energy Act (2012). The country also ratified the Paris Agreement in 2016, started work to establish its Blue Economy Strategic Roadmap in the same year and launched Blue Bonds in 2018.

AFI Deputy Executive Director noted that financial regulators are in an important position to lead inclusive green finance (IGF) initiatives and influence private sector resources towards a more sustainable and greener development pathway. He explained that IGF aims to ensure that steering resources towards green objectives will not result into financial exclusion but instead create a more inclusive environment and build resilience to the impacts of climate change. IGF is a unique proposition pioneered by AFI members, providing the 4P Framework of Inclusive Green Finance – Provision, Promotion, Protection and Prevention.

“We’re happy to note that across the AFI network, there are members that have already advanced in this policy area. Even in the absence of a country blueprint on green finance, there were already initiatives taken by some members around renewable energy, disaster preparedness, and other relevant areas,” said Mumba.

A total of 27 employees from the central bank participated in the training. With peer learning and knowledge sharing at the core of AFI, the training also featured Apenisa Tuicakau, Manager, Domestic Market, Reserve Bank of Fiji and Dr. Anil Perera, Additional Director, Domestic Operations Department, Central Bank of Sri Lanka, who shared their experience and work on IGF in their respective jurisdictions.