Indonesia is always ready to support global recovery in accordance with the spirit of the 2022 G20 Presidency...Jakarta (ANTARA) - Climate change must be addressed without delay so that it does not disrupt monetary and financial system stability, Senior Deputy Governor of Bank Indonesia (BI) Destry Damayanti has emphasized.
"The increasing extreme weather, clean water crises, forest fires, and other environmental disruptions have the potential to disrupt monetary and financial system stability," she noted during a webinar on Friday.
According to experts, the cost of handling the damage caused by climate change is estimated to be higher than the cost of handling the 2008 global crisis and the COVID-19 pandemic, she highlighted.
Over the last 20 years, the cost of dealing with extreme weather has reached US$1.51 trillion, Damayanti said.
In addition, a number of analysts have predicted that without any action on climate change, the Earth's temperature will rise by 3.2 degrees Celsius, which will lead to an 18-percent decline in global GDP (gross domestic product), she added.
"However, if we can realize the targets of the Paris Agreement, the maximum temperature increase will be below two degrees Celsius, while global GDP will only reduce by four percent," the official said.
Hence, through its G20 Presidency, Indonesia is stressing the importance of sustainable financing for ensuring a green, sustainable, and inclusive global economic recovery, she explained.
Indonesia has developed a number of sustainable financing products, such as green bonds and green sukuk, Damayanti noted.
Green bonds, which have grown significantly, are projected to reach US$260 billion during 2021–2023, she said.
Related news: G20 Presidency expected to focus on climate change financing: UNDP
Bank Indonesia has also determined the BI Green Financial and Institutional Framework, consisting of the two pillars of green policy transition and green institution, she added.
They aim to realize an inclusive, sustainable, and resilient financial system and economic growth, she said.
As of December 2021, BI has invested US$1.83 billion in the green portfolio, she informed.
Furthermore, Bank Indonesia’s senior deputy governor urged all countries to actively participate in international cooperation to mitigate global warming.
"Indonesia is always ready to support global recovery in accordance with the spirit of the 2022 G20 Presidency of ‘Recover Together, Recover Stronger,’" she added.
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Translator: Kuntum Riswan, Uyu Liman
Editor: Rahmad Nasution
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