Thursday, March 30, 2023

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Govt to appoint Green Finance Committee to develop 2023 climate funding roadmap

Government is set to appoint a green finance committee to raise funds for green finance projects in 2023,as it has been decided to publish a robust roadmap.

President Ranil Wickremesinghe has instructed the appointment of a green finance committee, which will be chaired by Ruwan Wijewardena, Senior Advisor to the President on Climate Change.

A preliminary discussion was held last morning ( 17) at the Presidential Secretariat, chaired by Wijewardena.

Green finance involves directing financial resources to address climate change challenges and to transition towards a low-carbon economy.

The Roadmap on Green Finance aims to merge ongoing processes like green finance, green bonds, climate finance, etc., into a single platform with a clear scope, measures, and targets. During the discussion, significant attention was given to these issues.

The Central Bank of Sri Lanka has already launched the Sri Lanka Green Finance Taxonomy, a classification system, which defines and categorizes economic activities that are environmentally sustainable, and is a key action item outlined in the Roadmap for Sustainable Finance of Sri Lanka introduced by the Central Bank in 2019.

The Taxonomy has been prepared in line with the international best practices, while harmonizing for local context, hence it is expected to enable financial market participants to raise low-cost funding for green activities through both domestic and foreign markets.

The Sri Lanka Green Finance Taxonomy would be applicable to all domestic and foreign market participants offering financial products (such as bank lending, debt instruments, portfolio management, and investment funds), large corporations, as well as national and local government bodies.

t can also be used as a reference by the industrial planning authorities and served as the basis for local governments to support green industries covering a range of economic activities such as Forest and Logging, Agriculture, Manufacturing, Electric power generation, Transmission and distribution, Gas, steam and air conditioning supply, Water supply, sewerage and waste management.

Construction, Transportation and storage, Financial services and Tourism and recreation. The Sri Lanka Green Finance Taxonomy was developed with the technical and financial assistance of the International Finance Corporation (IFC), and the process was facilitated through the Sustainable Banking and Finance Network (SBFN) and the IFC Green Bond Technical Assistance Program (GB- TAP).

The Sri Lanka Green Finance Taxonomy is a a critical tool to guide financial institutions, investors, corporates and green-bond issuers to navigate the transition to a low-carbon, climate-resilient, and resource efficient economy.

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