H.E Gamal Negm, Deputy Governor, Central Bank of Egypt, delivers opening remarks during the G-24/AFI Leaders' Roundtable

13 April 2021

G-24/AFI Leaders’ Roundtable: Inclusive Green Finance: A Pathway to Sustainable COVID-19 Recovery

 

Opening Remarks by H.E Gamal Negm, Deputy Governor, Central Bank of Egypt

 

It is my pleasure to open this 13th Annual G-24/AFI Policymakers’ Roundtable at the virtual 2021 IMF and World Bank Spring Meetings, to be held under the theme of “Inclusive Green Finance: a Pathway to Sustainable COVID-19 Recovery”.

The COVID-19 pandemic has hit developing countries and emerging economies hard and the effects will be long-lasting, despite the progress we are now seeing with global vaccine distribution giving cause for optimism. In particular, it is abundantly clear that the crisis has exacerbated already entrenched inequalities and has had disproportionate impacts on individuals and communities who were already disadvantaged. This includes small and medium enterprises (SMEs), women and girls, youth as well as older persons, persons with disabilities, and forcibly displaced persons, all of whom have been recognized in the AFI network’s “Kigali Statement” as priority groups for our financial inclusion strategies, requiring tailored and sensitive policy approaches. In light of COVID-19, all countries need to employ a people-centric approach to protect the financial inclusion gains of the last decade, and to prevent falling back catastrophically in respect of progress towards the Sustainable Development Goals (SDGs). In other words, our policy responses to the pandemic, must leave no one behind.

At the same time, there is now widespread international consensus that a sustainable and green recovery from COVID-19 is critical for all countries to build back better from the crisis. The ongoing pandemic has provided a stark warning of the threat to global economic and financial stability that can be posed by an exogenous shock to the financial system and to the global economy. Unfortunately, the reality is that with the effects of climate change, this type of external shock to the system is likely to become increasingly common in the future, even as nations strive to achieve the climate targets to which they have committed under the Paris Agreement. Just as with the pandemic, such climate-related shocks will impact the most vulnerable communities the hardest, despite the fact they have been amongst the least contributors to climate change.

For this reason, an inclusive approach that recognizes the disproportionate impacts of climate change on the most vulnerable countries and communities, and supports the implementation of practical solutions to assist national mitigation and adaptation efforts is key.

Inclusive Green Finance (IGF) has emerged as a truly unique approach for financial policymakers and regulators from developing markets to promote and advance green finance. Over the past three years, AFI members launched IGF as an important policy area and established it as a means to build resilience and enable mitigation to climate change in markets that serve the most disadvantaged and vulnerable populations.

Today’s Roundtable discussion will provide us with the opportunity to hear from Central Banks and policymakers both in the AFI and G-24 networks, but also our guests from developed country financial regulators and key international organizations, how they are addressing climate risks and promoting inclusive green finance within their respective mandates. I am looking forward to hearing practical and insightful case examples from fellow Governors and expert speakers over the course of the next two hours. This occasion is also an important opportunity to influence the global dialogue on climate action and green finance, on the pathway to the pivotal UNFCCC COP-26 meetings in November of this year, and with a variety of international processes to advance the agenda, including through the leadership of the G20, fully underway. Momentum has perhaps never been higher, but needs to be backed by concrete commitments and actions, as well as ensuring global representation and diverse perspectives at the decision-making table.

The topic before us today is very close to our hearts in the Central Bank of Egypt, having launched the Sharm El Sheikh Accord on Financial Inclusion, Climate Change & Green Finance at the 2017 AFI Global Policy Forum. We have come far as a network in the four years since to advance this agenda. We need to make even more progress in the next four years to meet the scale of the challenge with sufficient urgency.

Today’s discussions will focus on three central aspects:

  • Firstly, we will hear how the concept of Inclusive Green Finance has been developed in the AFI network, in line with the Alliance’s Policy Leadership mandate and to advance global thought leadership on the interrelationship of climate action, green finance and financial inclusion;
  • Secondly, through presentations of four of my fellow Governors from Kenya, Seychelles Sri Lanka and Paraguay, we will hear how AFI members have advanced practical policy implementation to make IGF not just a concept but a reality that is making a material difference to vulnerable populations’ ability to adapt to the impacts of climate change;
  • Thirdly, with key international partners of the G-24 and AFI, we will discuss the trend towards global convergence on the recognition of the importance of green finance and climate action by financial sector actors, and the opportunity to move the needle on global action for IGF through effective international cooperation.

I am looking forward to fruitful discussions today, and thank all members for their active participation and experience sharing.


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