Jakarta, January 26, 2022 – Under the Indonesian G20 Presidency, the first sustainable Finance Working Group (SFWG) meeting was jointly hosted by the Ministry of Finance and Bank Indonesia. In her opening speech, Dian Lestari, Director of Centre for Climate Finance and Multilateral Policy, Fiscal Policy Agency, Ministry of Finance highlighted, “We recognize the importance of creating an enabling environment to help enable the financial market to meet the goals of the Paris Agreement and 2030 Agenda. Discussion on the range of policy levers that incentivize financing and investment that, would be key to support a just and affordable transition”. The sessions were led by the United States of America and the People’s Republic of China as the SFWG co-chairs and moderated by UNDP as the SFWG Secretariat to discuss the 2022 SFWG Note on Agenda of Priorities.”
The Note on Agenda of Priorities in 2022 includes reporting on the progress of the G20 Sustainable Finance Roadmap, endorsed by G20 Finance Ministers and Central Bank Governors in October 2021. The report primarily review works being done voluntarily by members both in the Finance Track and the Sherpa Track, international organizations, and other international networks and initiatives, in relation action plan from the roadmap.
The First Finance and Central Bank Deputies Meeting on 9 – 10 December 2021, the SFWG Meeting further discussed three workstreams for 2022, namely: (1) Developing of a transition finance framework to strengthen credibility of financial institution commitments. The development of a transitional financial framework is intended to enable financial markets support the transition of global economy towards sustainability. In parallel, improving the credibility of financial institutions commitments is carried out by establishing best practices to implement net-zero and related commitments; (2) Scaling up sustainable finance instruments, focusing on improving accessibility and affordability. These include discussion on access to global sustainable finance markets, risk reduction mechanisms for sustainable finance instruments, and addressing knowledge gaps related to sustainable finance instruments, especially for relevant stakeholders in developing countries and Small and Medium Enterprises (SMEs); and (3) Discussing policy levers related to incentivize financing and investment which support the transition. During this discussion, participants highlighted the impact of policy levers on financial markets and policy options, considering the difference in national circumstances.
The first SFWG Meeting was attended by all G20 members, invitees, and international organizations. Co-chairs will bring the first SFWG Meeting results into the discussion at the Second Finance and Central Bank Deputies Meeting and the First Finance Ministers and Central Bank Governors (FMCBG) Meeting held in February 2022.