Green financial sector initiatives, including financial policies, regulations, and instruments, could play an important role in the low-carbon transition by supporting countries in the implementation of economic policies aimed to decarbonize their economy. Thus, it is fundamental to understand the conditions under which and the extent to which green financial sector initiatives could enable the scaling up of green investments and the achievement of national climate mitigation objectives, while, at the same time, avoiding unintended effects on macroeconomic and financial stability. However, this understanding is currently limited, in particular in the context of emerging markets and developing economies.
In this project, CLIMAFIN has developed for the world bank a computational model for the economic and financial assessment of green financial sector interventions. The model provides an assessment of the GHG emissions induced by monetary and financial policies building on the GHG protocol. See the full report here