The State Development Bank announced the launch of a new product in the field of green financing with the support of the United Nations Development Program (UNDP). This green finance product provides partners with the opportunity to join the growing trend of environmentally responsible investments. 

Green finance plays an important role in achieving carbon reductions and can drive the transition to a carbon-neutral economy. It involves raising funds to address climate and environmental issues on the one hand and improving the management of climate and environmental financial risks on the other. In turn, “sustainable finance” considers environmental, social, and governance issues and risks to increase long-term investment in sustainable economic activities and projects. 

“The State Development Bank strives to create financial instruments that will help preserve the environment in which we live and contribute to the sustainable development of society,” emphasized Azizbek Saipidinov, Deputy Chairman of the State Development Bank.

UNDP Kyrgyzstan focuses on sustainable, inclusive, and gender-sensitive development-oriented policies and accountable institutions for economic growth. A green entrepreneurship and investment environment is supported in partnership with the private sector to increase economic productivity and trade, especially for women and youth.

“UNDP supports the priorities set by the Government of Kyrgyzstan by assisting in the development and implementation of policies and strategies that support the country's socio-economic development. In this regard, UNDP supported the State Development Bank in developing its own taxonomy of green projects to ensure transparency and standardization in this area. This will help the bank's partners and clients determine which projects meet the green criteria before adopting the country taxonomy. UNDP will continue to support the State Development Bank in developing the potential of its and its partner banks, both in terms of theoretical foundations and practical tools for implementing the development of green financial products,” said Alexandra Soloviova, UNDP Resident Representative. 

In addition, the Bank has developed operational procedures for evaluating green projects, considering the specifics of the green agenda in the Kyrgyz Republic. The State Development Bank will provide banks with the necessary documents and instructions to organize these project assessment procedures. This includes templates for completion, risk analysis, and procedural rules. 

Interest rate conditions are attractive for borrowers, given current market interest rates. Moreover, the State Development Bank allows banks to return part of the interest rate to disciplined borrowers, encouraging them to use financial resources more responsibly. 

The process of assessing projects begins with their classification according to the taxonomy of green projects of the State Development Bank. This allows us to determine whether the project meets green criteria and what environmental benefits are expected from it. Evaluation criteria may include aspects, such as emissions reduction, energy efficiency, use of renewable energy sources, and other environmentally significant factors. A project risk assessment is then carried out, including environmental and financial aspects. This is an important stage that allows you to assess the likelihood of successful implementation of the project and its impact on the environment. The completed package of documents is submitted to the State Development Bank for consideration. As part of the consideration of the application, the State Development Bank carries out project validation, which means checking compliance with the criteria of green projects and established requirements. After thoroughly assessing all factors, including financial indicators, a decision is made to allocate funds to finance the project.

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Media contacts: 

Ainagul Abdrakhmanova, Communications Officer +996775755