The Inclusive Green Finance Policy (IGFP) Project

The Inclusive Green Finance Project (IGFP) was initiated in 25 June 2021 with the aim of greater climate resilience and inclusive green growth in PNG. IGFP marks the first step towards green finance in PNG, thereby facilitating future efforts to monitor, regulate, and promote green finance flows. 

‘Climate Resilience and Inclusive Green Growth’ is one of the key pillars of Papua New Guinea’s Development Strategy. Its importance is emphasized in ‘PNG Vision 2050’, ‘PNG Development Strategy Plan 2010-2030’, ‘National Strategy for Responsible Sustainable Development (StaRS)’, and ‘Medium Term Development Plan 2018-2022’. The government has set various targets to achieve this goal such as reduced GHG emission, increasing power generation from renewable resources, and improved disaster monitoring, etc.

Meeting these targets requires – in addition to sound policies and enabling environment for the public sector- a significant and sustained investment from the private sector. These investments (or “green” finance) should be directed towards “green” activities that contribute towards building climate resilience and promoting inclusive green growth.

However, at present, PNG lacks an official taxonomy to guide government agencies, financial institutions, and other private sector entities on which activities are considered ‘green’ and/or ‘inclusive’. For government agencies, this makes it difficult to monitor, regulate, and promote green financial flows into and within the country. For financial institutions and private sector entities, it is difficult to know whether they are complying with a certain policy (e.g., mandatory disclosure on green investments) or are eligible for incentives related to green activities (e.g., low interest green loans).

Hence this project aims to address this gap by developing an Inclusive Green Finance Policy (IGFP). The IGFP would include a green taxonomy that will help promote green financial flows thus promoting green activities and overall help achieve climate resilience and inclusive green growth for PNG.

Objective, Outputs and Activities

The goal of this policy is to increase and facilitate the flow of national and international funds and investments in a systematic manner towards business, projects, and initiatives that are ‘inclusive’ and/or ‘green’. There are three (3) outputs to this Inclusive Green Finance Policy (IGFP) project:

    • A green taxonomy with strong emphasis on financial inclusion,
    • Doing a diagnosis on the state of inclusive green finance in PNG, and
    • An implementation roadmap.

The project launched in June 2021 and is expected to conclude in early 2022.

Project Governance

The project is led by a Steering Committee (SC). They are advised by Technical Working Groups (TWGs) composed of public and private sector representatives.

Steering Committee  The Steering Committee  helps to steer a project through from start to completion and its role is to provide advice, ensure delivery of the project outputs and the achievement of project outcomes. The Steering Committee members are: 

    • Bank of Papua New Guinea (Chair)
    • Department of Treasury
    • Centre for Excellence in Financial Inclusion
    • Climate Change and Development Authority
    • Alliance for Financial Inclusion, and
    • New Zealand Ministry of Foreign Affairs and Trade (observer)

Technical Working Groups The Technical Working Groups define the necessary regulatory, technical, and financial preconditions to be put in place within a feasible period to allow the green finance policy to become operational. 

The Global Green Growth Institute (GGGI) serves as the Secretariat with support from Agriculture and Finance Consultants GmbH (AFC).

Meetings

  • First Steering Committee Meeting- 11 October 2021

 

Contacts

Mr. Saliya Ranasinghe Director, Centre For Excellence In Financial Inclusion (CEFI)                                                                      saliya@thecefi.org

Dr. Achala Abeysinghe Country Representative, GGGI PNG Office                                                                                                        achala.abeysinghe@gggi.org 

Mr. Jisu Min Senior Investment Officer, GGGI Headquarters                                                                                                                            jisu.min@gggi.org

With the support of the New Zealand Ministry of Foreign Affairs and Trade.

Publications