7 May 2021
FOR IMMEDIATE RELEASE
Mbabane/ Kuala Lumpur (6 May 2021) – The Kingdom of Eswatini and the Alliance for Financial Inclusion (AFI) organized a national-level capacity building and coordination event to advance inclusive green finance (IGF) in the country.
The training was attended by 53 participants from the Ministry of Finance, Central Bank of Eswatini (CBE), Financial Services Regulation Authority (FSRA), Eswatini Financial Intelligence Unit (EFIU), Finmark Trust, Ministry of Tourism and Environment Affairs, Eswatini Environment Authority, the Energy Regulatory Authority, Ministry of Agriculture and Financial Institutions.
“The impacts of climate change and environmental degradation are unprecedented and continue to threaten key economic sectors,” said Finance Minister Neal Rijkenburg, adding that this presents a material risk to long-term financial stability.
Eswatini has ratified the Paris Agreement and has communicated its Nationally Determined Contribution which embodies the country’s commitment to the global climate goals.
According to Rijkenburg, while climate and environment-related agencies take the lead in the implementation of national plans and actions, the financial sector plays a critical role in driving a resilient and low-carbon development pathway. This especially affects those at the bottom of the economic pyramid, as the financially excluded have limited coping capacities and need access to financial services to build their resilience to the changing climate.
“Financial inclusion is one of the tools that can help in resilience-building among the most vulnerable groups while at the same time, allowing them to invest in low-carbon economic activities ”, explained AFI’s Executive Director Dr. Alfred Hannig. For this reason, inclusive green finance (IGF) is a rapidly developing policy area within the AFI Network, with a growing number of members integrating IGF into financial inclusion initiatives, other national financial sector strategies and as distinct policies.
Financial inclusion empowers resilience building through access to financial products and services such as insurance, credit, savings and payment systems. At the same time, it also enables the reduction of environmental degradation through access to green credit.
Dr. Hannig also stressed the importance of gender inclusive finance, adding that it is crucial to integrate specific vulnerabilities of women to climate change into policy design from the onset.
In closing the event, Central Bank of Eswatini Governor Majozi Sithole expressed gratitude to all participants who came together from various government agencies and organizations. “The thoughts and ideas that transpired today will go a long way in the adoption of green financing policy in Eswatini, as well as assist the Ministry of Finance to successfully develop and implement IGF initiatives in Eswatini,” said Governor Sithole.
The governor described that the biggest takeaway for the central bank is an action plan that was drafted collaboratively by the various stakeholders that attended the training. He added that the action plan will be followed by the Government of Eswatini to advance IGF policies in the kingdom.
“There is a good understanding on the mandate and role of financial regulators with regards to green finance. We also got to appreciate AFI’s 4Ps of inclusive green finance – provision, promotion, protection and prevention – which offers financial regulators an intuitive way to think about the full range of policies that they can adopt for inclusive green finance,” added the governor.
About the Centre for Financial Inclusion
The Centre for Financial Inclusion (CFI) is a semi-autonomous body under the auspices of the Ministry of Finance (MoF) with the mandate to coordinate and facilitate the implementation of the National Financial Inclusion Agenda in the country. Key to the implementation of the Financial Inclusion agenda is the generation of financial inclusion data through both the Consumer FinScope & MSME Finscope Surveys. http://www.cfi.org.sz/
About the Central Bank of Eswatini
The Central Bank of Eswatini (CBE) is a banker to Government and commercial banks, managing reserves, administering exchange controls, collecting statistics on the economy and becoming permanent advisor to Government. Its mandate is to formulate and implement sound monetary policy to achieve financial stability. The CBE also regulates and supervises the financial sector in order to achieve a sound and efficient financial system. https://www.centralbank.org.sz
About the Financial Services Regulatory Authority
The Financial Services Regulatory Authority(FSRA) is an integrated regulatory and supervisory authority for non-bank financial services providers in Eswatini. Sectors under supervision include: Insurance, Retirement Funds and Medical Schemes, Capital Markets, Savings and Credit Institutions. www.fsra.co.sz.
AFI is the world’s leading organization on financial inclusion policy and regulation. Currently, 100 member institutions make up the AFI network including central banks, ministries of finance and other financial policymaking or regulatory institutions from 88 developing countries and emerging markets. AFI empowers policymakers to increase the access and usage of quality financial services for the underserved through sustainable and inclusive policies and an effective use of digital technologies. www.afi-global.org
AFIs Inclusive Green Finance (IGF) workstream is part of the International Climate Initiative (IKI) supported by the German Federal Ministry for the Environment, Nature Conservation and Nuclear Safety (BMU), based on a decision of the German Bundestag.