Port Moresby, Papua New Guinea, March 25, 2024 – The Global Green Growth Institute (GGGI) and the Bank of Papua New Guinea (BPNG), along with three Papua New Guinea financial institutions, namely the Bank of South Pacific (BSP), Nationwide Micro Bank (MiBank) and Women’s Micro Bank Ltd (Mama Bank) signed a Memorandum of Understanding (MoU) during the launch of The Green Finance Centre (GFC) in PNG to integrate and reinforce the Inclusive Green Finance Policy (IGFP) into their operations and services.
The MoU provides a general framework for cooperation and facilitates collaboration between the Parties in support of the Inclusive and Green Finance Policy (“IGFP”) of Papua New Guinea, building on their comparative advantages and ensuring their complementarity and mutual reinforcement. Essentially, under the spirit and intent of the MOU, BSP, MiBank and Mama Bank will pilot the inclusive green taxonomy in the PNG financial sector, which provides a framework for classifying green loans.
GGGI, through the GFC as the IGFP delivery partner will be guided by the IGFP Steering Committee in providing policy advisory services, technical assistance, and knowledge-sharing and capacity building activities.
The GFC will be conducting a needs assessment that will eventually shape the development of green loan products that are aligned with the taxonomy. GFC and the financial institutions will also convene periodic consultations to review planning, implementation, and outcomes of cooperation as well as identify opportunities and follow-up activities for enhancing their collaboration.
Under the Agence Française de Développement (AFD) funded program “Greening the Pacific Financial System” (GPFS), GFC will be establishing and capitalizing the Green Refinancing Facility (GRF) of 1.8 million Euros in Papua New Guinea. The financial institutions through the MoU and aligning to the IGFP will qualify to access the GRF.
Chief guest at the launch, Chief Secretary, Government of PNG, Honorable Ivan Pomaleu, commended BSP, MiBank and Mama Bank for signing the MOU and supporting the implementation of IGFP and said, “The IGFP sets out a clear roadmap for greening PNG’s banking and financial sector, with a focus on sustainability, resilience, and inclusivity. Central to this policy is PNG’s Inclusive and Green Taxonomy, which provides a framework for identifying and monitoring green financial flows, essential for achieving our sustainability goals”. “I am pleased to announce that the Green Finance Centre has already begun its crucial work of implementing the IGFP. With a dedicated team in place, the GFC is poised to drive the transformation of PNG’s financial sector, ensuring that it is sustainable, resilient, and inclusive,” the Chief Secretary added.
Governor for Bank of Papua New Guinea, Mrs. Elizabeth Genia, also commended BSP, MiBank and Mama Bank and said, “Climate change poses significant threats to MSMEs as well, particularly in developing countries like PNG, affecting their competitiveness, performance, and sustainability. Women-owned/led MSMEs (WMSMEs) are especially vulnerable to climate change impacts. Despite progress in MSME-centric IGF policies, various barriers hinder MSMEs from accessing green finance, including limited applicability of green taxonomies, higher costs of green financing, and lack of risk sharing mechanisms.”
GGGI PNG and Solomon Islands, Country Representative, Sakiusa Tuisolia, said “Signing of the MoU with the three financial institutions was a key step towards our work to integrate the Inclusive Green Finance Policy onto the lending books of the financial institutions.”
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Signing of the Inclusive Green Finance Policy MoU
GGGI Country Representative for Papua New Guinea and Solomon Islands, Sakiusa Tuisolia (L), Governor for Bank of Papua New Guinea, Ms. Elizabeth Genia (2nd-L) with Bank of South Pacific’s Group Chief Risk Officer Mike Hallinan, Nationwide Micro Bank’s Chief Operating Officer, Trudi Egi and Women’s Micro Bank’s Chief Executive Officer Gunanidhi Das signed MoU for IGFP implementation.