Solving the climate crisis: pushing for Inclusive Green Finance at COP28

Inclusive green finance (IGF), which involves empowering vulnerable countries and communities to build resilience and mitigate climate impacts through access to financial services, is now firmly on the global agenda, thanks to the AFI network. 

On 1 December, at the COP28 meeting in Dubai, AFI and the University of Luxembourg hosted a side event highlighting how inclusive green finance is contributing to financial stability and market efficiency, and calling for IGF to be adopted worldwide. This is AFI’s second year at COP, following the launch of the IGF Roadmap at COP 27 in Sharm El Sheikh, Egypt.  

Four AFI members – Bank of Papua New Guinea, Nepal Rastra Bank, Bangko Sentral ng Pilipinas and Banco Central de Reserva de El Salvador – shared their insights and current work with IGF development. Multiple AFI partners were also present, including senior representatives from EBRD, the World Bank, CGAP, the We-Fi Secretariat, VISA, and ClimateWorks Foundation.  

“Climate change poses a serious threat to financial stability,” said Elizabeth Genia, Acting Governor of Bank of Papua New Guinea. “If rural communities and vulnerable areas are to survive, we must look to financial inclusion to strengthen their resilience and enhance their ability to adapt.”  

“Poor and marginalized communities are most affected,” emphasized Dr. Gunakar Bhatta, Executive Director, Banks and Financial Institutions Regulation, Nepal Rastra Bank. “They are losing their cattle, their crops and their livelihoods. By giving them access to IGF products like micro-insurance, we can help protect them against climate change.”  

“Access to resilience-building tools like micro-insurance, as well as opportunities to transition to green, will help low-income populations withstand climate impact and allow them to contribute to the overall economic resilience,” noted Mynard Mojica, Deputy Director, Bangko Sentral ng Pilipinas 

“Central banks and regulators play an essential role in mitigating climate change,” said Gabriela Michelle Viera Pineda, Investment Systems Administrator at Banco Central de Reserva de El Salvador. “But they need buy-in from the country’s public, private and financial sector to do so effectively, and with the necessary resources.” 

The event also featured Mathilde Bord-Laurans, Head of the Climate and Nature Division at Agence française de développement, and Prof. Dirk Zetsche, ADA Chair in Financial Law (inclusive finance) at the University of Luxembourg. 

“Change comes about in the micro-environment. It must come from small steps, and every one of us can contribute,” said Prof. Zetsche. “But it is particularly helpful if regulators create an environment in which efficiency, sustainability and inclusiveness go hand in hand.”  

“We’ve heard some wonderful examples today of the work central banks are doing to advance inclusive green finance,” concluded Johanna Nyman, Head of Inclusive Green Finance at AFI. “It’s easy to be intimidated by the task ahead of us, but also very encouraging to see so many central banks taking action, testing and learning, and taking the first steps. Inclusive green finance is clearly a part of the mandate of central banks and progressing rapidly.” 

READ MORE:  

Papua New Guinea’s Inclusive Green Finance Journey 

Roadmap for Inclusive Green Finance Implementation