On October 7 2020, the Global Green Finance Leadership Program (GFLP) kicked off its second webinar of the year, GFLP Webinar on Green Finance: Post-COVID Recovery and Biodiversity, convening experts from Asia, Europe, Africa, and South America to share insights and experiences on green recovery, green taxonomy, and biodiversity finance.
The two-day event was co-hosted by Research Center for Green Finance Development at Tsinghua University, World Bank Inclusive Growth and Sustainable Finance Hub in Malaysia, and UN Environment Financial Centers for Sustainability (FC4S), with support from UK PACT.
With COVID-19 pandemic exacerbating the pre-existing environmental and social challenges, Post-COVID recovery is becoming an increasingly important theme worldwide. In his keynote speech, Ndiame Diop, Country Director for Brunei, Malaysia, Philippines, and Thailand at the World Bank, pointed out three key components: investment in sustainable infrastructure, data improvement on green financial markets, and capacity building for financial institutions.
The first session of the webinar then centered on the aspects of how financial regulators, centers, and institutions can contribute to a green recovery. Dr Ma Jun, chairman of China Green Finance Committee, addressed the role of fiscal resources to support green and sustainable development projects, stimulate green consumption, and create jobs in green industries. On the private side, according to Sean Kidney, CEO of Climate Bonds Initiative, the expansion of the green financial market has gained great momentum over the past months, with record-high issuance of green bonds and massive growth of green loans.
A few speakers also emphasized the demand for more data availability and transparency in this process, which echoed to the second theme of the webinar, Green Taxonomy, as it sets the prerequisite of such data. Experts from the EU, Mongolia, Kazakhstan, Colombia, and China shared experiences on developing green taxonomies and challenges to do so, and they all mentioned that taxonomies will need to fit into national contexts, while trying to align with existing international ones.
The first time for biodiversity and sustainable farming to be put on the webinar agenda, the GFLP attempted to broaden the scope of discussion on how green finance can be scaled up to support more green industries, as opposed to focusing only within the financial sector. The session featured speakers from not only financial institutions and related initiatives, but also real-sector stakeholders, such as biotech and food enterprises.
“Biodiversity in many countries is seen as a public good and as such it relies heavily on public funds which insufficient,” said Rekha Reddy, Senior Financial Sector Specialist at World Bank, during her welcome remarks, “[…] The challenges are to reorient public funds to reverse biodiversity loss while simultaneously mobilizing private financing.”
Mark Halle, Senior Advisor at UN Environment Financial Centers for Sustainability Network (FC4S), raised the question of how biodiversity risk can be made material in the decisions taken by financial institutions and actors, and underlined the importance of policy reforms to meet the requirements of a healthy planet.
On one hand, biodiversity conservation projects create value in monetary sense, and if properly designed, can help alleviate poverty in the meantime. On the other hand, more presence of private capital is needed. There have been some innovative financial products such as sustainability-linked loans to assist farmers with sustainable farming, while new products such as nature performance bond may be considered as conditional debt relief, particularly against the backdrop of COVID-19 aftermath.
Another highlight of the event, Green Project Showcasing, which used to be in-person visits to green projects in previous GFLP seminars, has also taken a digital form, with presenters from Elion, Rimba and E-Zhasyl Technology to introduce cases on waste-to-energy stations, desert reforestation, and tropical forest conservation.
The GFLP webinar concluded with over 150 discussants and 1000 people streaming from different continents. In the future, it will continue to host more capacity building webinars, while seeking to develop knowledge products in this regard.