Financial Sector

How a Green Financial Sector Revolution can Contribute to Decarbonization?

The Green Finance Sector Initiative (GFSI) is a set of policies, regulations and financial instruments that governments can use to generate private finance through carbon-intensive investments and then climate- or green-financed investments. ์นด์ง€๋…ธ์‚ฌ์ดํŠธ

This change provides essential funding for climate action and protects companies and then financial systems against climate risks. The GFSI is part of a regional green finance reform process for countries that are increasingly using their climate change strategies. GFSIs address many of the barriers to increasing green finance, including the inability of investors. Invest in greenhouse gas (GHG) emissions, and financial markets that are not well-prepared for climate risks, weak institutional capacity and then environmental instability.

By breaking these barriers, GFSI can adjust the availability and price of capital for low and then high carbon projects. This increases the demand for green investment with implications for regional efficiency, productivity and GHG emissions. Many business investors have announced their intention to move to a greener portfolio, and countries that are actively pursuing green finance sector reforms will be well positioned to attract this investment.

This document covers several high-capacity GFSIs:

Green macroprudential policy: green support and then dirty/high carbon penalizing.
Finance Policy: Green Support Factors and then Green Budget Reduction.
Public financing: soft loans and portfolio projects.
This paper critically examines these diffusion methods of GFSI and their impact on the availability and cost of capital for high and low carbon assets. In addition to their direct effects, GFSI can also stimulate economic activity, with implications for investment, production and GHG emissions that should be considered in climate policy and development.

If green conditions are not included in the climate risk assessment and GFSI. They may also benefit from carbon-intensive programs and lead to an unexpected increase in GHG emissions in the economy. Building on this information, the paper develops a concept of change in the GFSI role in climate change mitigation and low carbon change, identifying levers to increase impact. ์˜จ๋ผ์ธ์นด์ง€๋…ธ์‚ฌ์ดํŠธ

1: Transmission Channels of Soft Loans and Credit Guarantees

Understanding media channels and reducing emissions has two main benefits. First, it allows policymakers to understand how much the GFSI will actually decrease. This can help them choose between different GFSIs and determine the amount of emissions reductions. Expected under national climate change mitigation plans and targets such as Nationally Determined Contributions (NDCs). Under the Paris Agreement.

2: Transmission Channels of a Green Supporting Factor

A second advantage of the GFSI-based GHG emission reduction measures is the ability to attract appropriate international public climate finance. Much of this climate income is based on employment. That is, it is provided in advance, often with no opportunity, to reduce the capital cost of large infrastructure projects.

However, this climate finance does not fit well with GFSIs, which do not result in the initial cost of infrastructure, but incur costs during implementation.

This makes results-based climate finance a suitable complement to the GFSI. As GFSI is paid based on emissions reductions achieved, it is important that robust methods to measure emissions reductions are available.

The World Bank’s ongoing Climate Change Group project.

Finance, Competition and Innovation Global Practice and then Macroeconomics. Trade, and Investment Global Practice. Uses the Theory of Change to develop a quantitative framework to quantify emissions reductions from different GFSIs. This model is currently being tested for Turkey and other selected countries.
When fully developed, the model will be available for developing and emerging economies (EMDEs). To understand how GFSI can affect financial systems and reduce emissions.

The model can be used to seek results-based climate finance necessary to support the GFSIs.

For example through the climate change finance bank and the new Scaling Climate Action by Lowering Emissions (SCALE). Which has a column dedicated to supporting countries. And then financial sector reform. ๋ฐ”์นด๋ผ์‚ฌ์ดํŠธ

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