Home ›› 17 Mar 2022 ›› Front
Despite the fact that Bangladesh has more than $200 billion in climate and green investment opportunities and a government policy requiring banks and other financial institutions to provide 5 per cent of loans for green finance each year, the percentage of loans disbursed in the last five years has been unsatisfactory, according to the Policy Research Institute (PRI).
PRI in collaboration with the World Bank Group on Wednesday organised a webinar titled “Incentives for Green Finance and Investment”.
The session’s objective was to understand the barriers faced by the private sector to access the finance needed to adopt green products, services, projects and begin to identify policies and institutions that can address these barriers.
Bangladesh ranked 162nd out of 180 countries as most polluted countries, said speakers at the webinar quoting a 2020 report of the Environmental Performance Index of the Yale University in the United States.
The country has lost about $6.5 billion or 3.4 per cent of its 2015 GDP due to pollution and environmental degradation in urban areas. Pollution caused nearly 28 per cent of deaths in 2015 – more than 10 times the number of deaths from traffic accidents, they added.
Speakers observed that missed opportunities for green and cost-effective nature-based solutions resulted in continuous overexploitation of national resources, over mining of groundwater, deforestation, unsustainable fishing, and deteriorated coastal habitats.
Industries are expanding, and pollution from sources such as untreated industrial chemical run-off, untreated urban sewage, agricultural, and other sources is increasing at the same time, they added.
According to PRI, various banks and non-bank financial institutions disbursed $4.3 billion for green projects between FY2016-20, namely, renewable energy, waste management and green brick manufacturing however the results have yet to become visible.
The World Bank supports mainstreaming environmentally sustainable practices (ESP) and cleaner technologies among 41,659 micro enterprises (MEs) by financing $110 million to Palli Karma-Sahayak Foundation (PKSF), according to a presentation given at the webinar.
The World Bank Group promotes green financing to enable the implementation of the Bangladesh government’s green growth strategies. This necessitates sustainable use of natural resources, avoiding environmental degradation, and low emissions policy measures to fight the adverse effects of climate change to boost development.
To create incentive structures for firms to adopt green practices and to improve investors’ and financial institutions’ readiness to finance green initiatives, enforcement is required. It will incentivize firms to control their environmental impact, thereby leveling the playing field between compliant and non-compliant businesses and fostering competition.
In the welcome speech, PRI Chairman Zaidi Sattar, said, “Rapid growth based on low-carbon, environmentally friendly power generation (moving to renewable energy), industrial production, transportation, agriculture, and waste management must be made possible in order to leave a legacy of sustainable living for our children and grandchildren.”
The chief guest Dr Mashiur Rahman, economic affairs adviser to the prime minister, said: “To achieve inclusive green growth, we also need to support Cottage, Micro, Small, and Medium Enterprise (CMSME) as their growth depends on accessing new markets with stricter expectations on environmental impact and adopting circular concepts.
Among others, Iqbal Abdullah Harun, additional secretary, Ministry of Environment, Monika Kumar an environmental specialist with the World Bank, Sadiq Ahmed, vice chairman, Policy Research Institute (PRI), were present at the webinar.
