Illustrative image (Photo source: Antara)

Jakarta – As part of the first ASEAN Finance Ministers and Central Bank Governors’ Meeting (AFMGM) 2023 in Bali on March 30, Indonesia organised a high-level seminar themed “Aligning Policies for Climate Transition” to support the message of sustainable development, one of the ASEAN priority economic deliverables (PED) this year.

Speaking at the event, Governor of Bank Indonesia (BI) Perry Warjiyo said central banks play a crucial role in building a framework for green finance transformation, highlighting transparency and sustainability, as well as developing policies and mechanisms towards the goal of achieving net zero emissions to mitigate climate change.

He stressed that the ASEAN countries need technical support in the green transition process, in which the role of central banks is not only to promote but also carry out green finance, especially through financing the transition.

Delegates at the event discussed experience from international organisations in promoting sustainable finance.

According to the United Nations Development Programme, climate transition financing for developing countries requires a clear framework to ensure consistent policies and encourage the private sector to engage in.

Statistics showed that the value of sustainable finance transactions in the ASEAN countries reached only 82 billion USD last year, much lower than the potential.

To optimise this potential, the regional countries were advised to develop innovative financial products and tools, issue favourable regulations and policies, improve information transparency, mobilise international coordination, and manage risks and policies.