G20 backs green finance, will encourage green bonds market

Communiqué issued from Hangzhou, China, supporting Green Finance Study Group report.

G20 country leaders meeting today in Hangzhou, China for their latest summit, have given some high-level support to green finance initiatives by saying that “efforts could be deployed” to put in place clear market signals and strategic action plans, with a particular accent on the promotion of the green bond market.
The meeting is one of the first major summits since the Paris COP 21 agreement where financing to help fight climate change is on the agenda.
The G20 leaders said green finance still faced a number of challenges, including the ‘internalising’ by companies of so-called environmental externalities, an absence of a definition of what is green, and insufficient/asymmetric data sources for investment. It said a number of these challenges could be lifted via collaborative work with the private sector.On green bonds, the G20 said it would support the development of local markets and promote international co-operation for cross-border flows of green debt instruments. The leaders also welcomed a synthesis report produced by the G20 Green Finance study group, for which the UNEP Inquiry has acted as secretariat. Since January this year, the IMF, OECD, and the World Bank, among others, have produced 15 advisory papers across green finance and capital markets themes. The combined output – the G20 Green Finance Synthesis Report – was first presented at the third G20 Finance Ministers and Central Bank Governors Meeting under the Chinese Presidency in Chengdu on July 23/24, before being refined this summer. At that meeting, ministers and governors agreed that green investment and green finance should be promoted to support global sustainable growth. The G20 announcement comes just days after China and the US both committed to ratify the COP21 agreement.