Bali, June 15th, 2022 – The Third Sustainable Finance Working Group’s Meeting (3rd SFWG) under the Indonesian G20 Presidency was successfully held in Bali on 14 – 15 June 2022, hosted by the Ministry of Finance and Bank Indonesia. The meeting was 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. While opening speech has delivered by the Indonesian G20 Presidency Co-chair.
The SFWG meeting was held on a hybrid basis and attended by G20 members, invitees, international organizations (IOs), and knowledge partners. Prior to the SFWG Meeting, the Indonesian G20 Presidency held a one-day Forum on International Policy Levers for Sustainable Investment on 13 June 2022. The results of the 3rd SFWG Meeting and the prior Forum will be further discussed at the 3rd G20 Finance and Central Bank Deputies’ meeting and the 3rd G20 Finance Ministers and Central Bank Governors’ Meeting, which will be held in Bali next month.
During the two-days meeting, members discussed intensively the progress of following agendas: (i) discussion on policy levers that incentivize financing and investment that support transition; (ii) developing a framework for transition finance and improving the credibility of financial institution commitments; (iii) scaling–up sustainable finance instruments, with focus on improving accessibility and affordability, including discussions on de-risking facilities and encouraging the role of Multilateral Development Banks (MDBs) and scaling up the local market with the support of public development banks; and (iv) monitoring progress on the G20 Sustainable Finance Roadmap.
Anita Iskandar, Director of International Affairs, Directorate General of Customs and Excise – Ministry of Finance representing the Indonesian G20 Presidency, delivered the opening speech in the first day meeting. In her remarks, Anita stated, “our presence here today, both in-person and virtual, confirms the G20 commitment to achieve our sustainable development and climate goals, including securing a transition toward a low carbon economy that should be orderly, just, and affordable”. In order to encourage and support the green transition, Indonesian Presidency has put attention on the energy transition toward cleaner energy and its implementation, including intensive policy discussion in improving accessibility and affordability of the finance transition through the Energy Transition Mechanism (ETM).
To ensure the accessibility and affordability of the sustainable finance instruments, members highlighted the importance of enhancing digital technologies to reduce costs of sustainable finance operations, especially Small Medium Enterprises (SMEs), and encourage government to assist firms to adapt Sustainable Supply Chain Finance (SSCF). In addition, many members also highlighted the importance to emphasize more on SMEs as well as MDBs and IOs’ role in providing capacity building for developing countries. Others highlighted ways to improve accessibility by way of using the banking system, with some suggesting the involvement of local banks as partners for blended finance.
Regarding policy levers, many members have highlighted regarding the vast variety of tools and approaches available to achieve an orderly, just, and affordable transition and broad comments that “no one size fits all”. Members also support the development of a flexible and dynamic but also practical, credible, and science-based transition finance framework.
Indonesian G20 Presidency is committed to ensure collective actions and develop the best practices to deliver concrete deliverables in the SFWG to achieve the 2030 Agenda for Sustainable Development Goals and the Paris Agreement.