Key Impact Points
- Sustainable Finance Training: ESCAP, UN RCO, and Tajikistan’s Agency for Securities Market Development launched a training on green, social, and sustainability-linked bonds to enhance the country’s ability to finance climate initiatives.
- Tajikistan’s Green Economy Goals: Tajikistan has set climate mitigation and adaptation as top priorities, aiming to meet its NDC targets and bridge a significant funding gap.
- Developing a Green Bond Market: Tajikistan is taking steps to establish a green bond market, focusing on the corporate segment to mobilize public and private investments for climate action.
Overview
The United Nations Economic and Social Commission for Asia and the Pacific (ESCAP), the UN Resident Coordinator Office (RCO), and the Agency for Securities Market Development of Tajikistan, in collaboration with Luxembourg Green Exchange, have launched a two-day training program focused on thematic bond issuance. The training, titled “Sustainable Finance Instruments: Training on Thematic Bond Issuance”, aims to help Tajikistan strengthen its capacity to issue green, social, and sustainability-linked (GSS+) bonds, crucial for achieving the country’s Nationally Determined Contributions (NDCs).
Tajikistan’s Climate Finance Priorities
Tajikistan’s Strategy for the Development of the Green Economy for 2023-2037 places climate mitigation and adaptation at the forefront of its national agenda. To meet its NDC goals, the country estimates it will require funding equivalent to 7% of its GDP. Thematic bonds, such as green bonds, offer a critical financing avenue to support both public and private sector initiatives aimed at achieving these goals.
During the opening remarks, Majidi Yusuf Khairullo, First Deputy Minister of Finance of Tajikistan, highlighted the importance of the training: “This training allows participants to navigate the thematic bond issuance process, identify the best tools, and review best practices to support Tajikistan’s green capital market development.”
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Expanding Capacity for Thematic Bonds
The training, hosted over two days, provides technical knowledge and practical insights into bond issuance. It aims to strengthen the ability of future bond issuers and government stakeholders involved in the process. Participants included representatives from government institutions, financial market regulators, domestic banks, and other financial actors.
Hamza Malik, Director of Macroeconomic Policy and Financing for Development at ESCAP, emphasized the potential of green bonds to help Tajikistan meet its sustainable development goals: “The Green Bond Issuance training is a critical resource to raise awareness about how innovative financing instruments, particularly Green Bonds, can be leveraged to effectively pursue the Sustainable Development Goals and NDC ambitions.”
Challenges and Opportunities in Green Bond Issuance
The development of a green bond market in Tajikistan is not without challenges. Parvathy Ramaswami, UN Resident Coordinator, stressed the importance of establishing clear guidelines, standards, and a regulatory framework to create a conducive environment for bond issuance. Additionally, addressing barriers such as limited awareness, capacity, and higher issuance costs remains critical for the success of the initiative.
Tajikistan has already taken steps to establish a green bond market, with a focus on building its corporate segment. Nigina Abdurakhmonzoda, Director of the Agency for Securities Market Development of Tajikistan, expressed the government’s commitment to fostering sustainable finance: “Through our valuable partnership with the UN, we are committed to mobilizing public and private finance towards climate action, including through the issuance of green bonds.”
Conclusion
As Tajikistan progresses towards establishing a green bond market, partnerships with international organizations such as ESCAP, UN RCO, and the Luxembourg Green Exchange are playing a vital role in unlocking financing opportunities. This initiative marks an important step towards a more sustainable and resilient future for Tajikistan, contributing to the country’s broader climate action and green economy goals.
