The European Bank for Reconstruction and Development (EBRD) is launching a study aimed at assessing the potential of developing a green financial system in Kazakhstan “in a new step to support Kazakhstan’s path towards a greener economy.”
The system would boost financing for “green” projects in Kazakhstan and beyond and would be based within the forthcoming Astana International Financial Centre (AIFC), the EBRD said.
The AIFC is currently being developed in Astana, the capital of Kazakhstan, with the aim of becoming “a financial hub for the immediate region and beyond” EBRD said, adding that it is acting as one of the advisers to the AIFC Authority, the entity in charge of the centre’s development, on issues including green finance.
The scoping study, which will be available at www.greenfinance.kz, will look at ways of addressing major environmental challenges in the country, using market-friendly tools, EBRD explained. In line with the EBRD’s Green Economy Transition (GET) approach, the study will assess demand for green investment, including financial products such as loans and bonds. The research will also identify regulatory gaps and barriers, EBRD said. The results of the study are due be presented at the 2017 Expo in Astana, which will focus on the theme of “Future Energy”.
“A green financial system will help raise awareness and increase the involvement of the financial sector, in particular the private sector, in the delivery of green projects in Kazakhstan and more widely in Central Asia” commented Jan-Willem van de Ven, EBRD head of carbon market development.
Kazakhstan has set itself the goal to cut greenhouse gas emissions under the Paris COP21 climate agreement, and to raise the share of renewable energy in its total production to 3% and 10% by 2020 and 2030, respectively. To help the country achieve these goals, the EBRD has earmarked Eur200 million for renewable energy projects in Kazakhstan, with signings of specific renewables projects expected in the near future.
“The EBRD is already attracting climate financing from global climate funds and other financiers into Kazakhstan, including under the new framework” commented Aida Sitdikova, EBRD director for energy and natural resources in Russia, the Caucasus and Central Asia. “A green financial system could make renewable energy projects in the country even more attractive to independent private developers” she added.
The EBRD is already the largest renewable energy financier in Kazakhstan, having invested nearly Eur1.5 billion in green projects in the country and cooperated on regulatory reform and the country’s innovative carbon-trading scheme, it said.
Furthermore, the Kazakh authorities have expressed strong commitment to the national strategy of a green economy, including a green financial system.