BAKU, Azerbaijan, Nov. 22
Trend:
The Kazakh financial institutions have great potential to use high environmental standards in lending and investment practice, the Astana International Financial Center (AIFC) told Trend on Nov. 22.
“President of Kazakhstan Kassym-Jomart Tokayev announced about the intention to achieve carbon neutrality by 2060,” AIFC said. “This intention was announced on December 12, 2020 within the Climate Ambition Summit, organized by the UN Secretary General, timed to the anniversary of the signing of the Paris Agreement.”
“The sustainable finance instruments play a key role in achieving this goal and in transition to the green economy,” the message said. “So, despite Kazakhstan is at the initial stage of development of 'green finance', Nur-Sultan city ranked first in Eastern Europe and Central Asia in April and October 2021 according to the Global Green Finance Index (GGFI).”
Besides this achievement, the Kazakh financial institutions have issued a total of six green and social bonds, as well as one green loan over the past year (since August 2020).
“The stable bond market volume exceeded $100 million in Kazakhstan as of early November 2021,” the Astana International Financial Center said.
According to the message, Damu Entrepreneurship Development Fund JSC through the support of the United Nations Development Program (UNDP) successfully placed green bonds on the AIX exchange with a coupon rate of 11.75 percent and a circulation period of three years in 2020.
“The AIFC Green Finance Center supported the project by giving the second party opinion and the necessary advice,” the message said. “This was followed by the green bonds of the Asian Development Bank, social bonds of the Eurasian Development Bank and others.”
“The second-tier banks in Kazakhstan are at the very beginning of the path of introducing sustainable financial instruments,” a representative of the AIFC said.
“Eurasian Bank, in partnership with the MasterCard payment system, issued the first card in Kazakhstan made of recycled plastic - eco-card in June 2021,” a representative of the AIFC added.
According to the message, the bank sends 0.5 percent of bonuses from non-cash transactions for using an eco-card to the Eurasian Environmental Fund, established by the AIFC Green Finance Center for eco-projects in Kazakhstan.
“Moreover, the Eurasian Development Bank and Batys Transit JSC signed an agreement on a green loan to finance the construction and operation of street lighting systems in Atyrau city,” the AIFC said. “The AIFC Green Finance Center supported the project and helped to develop internal documents of Batys Transit JSC, including the Green Finance Concept.”
“The European Bank for Reconstruction and Development (EBRD) launched a $30 million Green Economy Financing Facility (GEFF) in Kazakhstan in 2020 to support gender-responsive green finance for households and small private companies investing in solutions related to the environmentally friendly technologies,” a representative of the AIFC added.
According to the message, EBRD and Bank CenterCredit signed an agreement on credit line for the development of green economy in the amount of $20 million in July 2021.
“This project is aimed at financing energy efficient modernization of enterprises and residential real estate in which environmentally friendly materials and technologies are used,” the message said.
