We have capital market financial instruments, such as green, sustainable, sustainability-related and social bonds, as well as market-lending instruments, such as green loans and sustainable loans
Jakarta (ANTARA) - Public and private sectors were still encountering difficulties in adopting and accessing sustainable financial instruments, thereby making it a unique challenge, Bank Indonesia (BI) Governor Perry Warjiyo stated.

Warjiyo believes this situation has arisen despite growth in the development of sustainable financial instruments since 2007, not only in terms of the volume but also variety.

"We have capital market financial instruments, such as green, sustainable, sustainability-related and social bonds, as well as market-lending instruments, such as green loans and sustainable loans," Warjiyo stated during the G20 Indonesia Presidency side event here on Friday.

The BI governor also remarked that several global financial institutions had begun capitalizing on green money market instruments, such as green or sustainable repos, green or sustainable commercial letters, and green derivatives or related to environmental, social & governance (ESG).

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Thus, in order to overcome these challenges, the second workflow of the G20 Sustainable Finance Working Group (SFWG) was formed, with the objective of increasing sustainable financial instruments and focusing on expanding accessibility and affordability.

G20 countries should collaborate in addressing common issues covering standards, market alignment tools including for reporting and disclosure requirements, ESG data metrics, and verification services.

"Not only various instruments but these (things) are relevant for the government, financial sector authorities, and the private sector, (so it was a must for them) to create a sustainable financial ecosystem together that will support the aspirations (realization)," he stated.


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Warjiyo deemed it important as the instrument could not function properly on its own.

A credible and efficient domestic market for sustainable financial instruments could not be created without the availability of local entities that conduct verification, certification, labeling, and consulting services.

Thus, an ecosystem regulates important processes that support system stability and maintain balance among its main actors.


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Translator: Mecca Yumna Ning Prisie
Editor: Fardah Assegaf
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