Eun Sung-soo Shares South Korea's Green Finance Policy... Presents Three Challenges Including Funding Gap

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[Asia Economy Reporter Jin-ho Kim] Eun Sung-soo, Chairman of the Financial Services Commission, introduced South Korea's green finance activation policies to representatives of international organizations and companies related to climate environment and finance on the 29th. He also presented three challenges to be addressed: funding gaps, data gaps, and others.

Chairman Eun made these remarks at 8 p.m. at the Dongdaemun Design Plaza in Seoul during the 'P4G (Partnership for Green Growth and the Global Goals 2030) Seoul Green Future Summit Green Finance Special Session.'

First, Chairman Eun said, "We are actively working to promote green finance," and introduced South Korea's green finance policies. He stated, "The proportion of funds allocated to the green sector by policy financial institutions will be expanded to twice the current level by 2030," adding, "Previously, President Moon Jae-in declared the suspension of public financial support for new overseas coal power plants." He continued, "Recently, the Financial Services Commission applied to join the Green Finance Network and, together with 13 related financial institutions, declared support for the Task Force on Climate-related Financial Disclosures (TCFD)."

He also pledged close cooperation with the international community to activate green finance for carbon neutrality. Chairman Eun said, "We will actively cooperate with international financial organizations located in Korea, such as the Green Climate Fund (GCF) and the Global Green Growth Institute (GGGI), to support green finance for developing countries."

He emphasized that three gaps must be resolved to activate green finance. Regarding the funding gap, he pointed out, "To achieve carbon neutrality, large-scale investments must be made in the green sector, requiring participation from private funds and multilateral development banks," and added, "Recently, blended finance, which refers to a mix of private and public funds in the green sector, has gained attention, which I believe stems from concerns about this funding gap." To this end, Chairman Eun urged the heads of multilateral development banks and domestic and international policy financial institutions attending the event to continue meaningful discussions.

He also stressed the importance of the data gap. He said, "To prevent greenwashing and ensure efficient allocation of green funds, it is necessary to understand how individual companies are preparing for the physical risks of climate change and the transition to a carbon-neutral economy." He added, "We expect institutions such as the Bank for International Settlements (BIS) and Standard & Poor's (S&P) to provide insights to help find ways to establish disclosure levels that meet investors' demands."

Lastly, he pointed out the gap between developed and developing countries. Chairman Eun expressed concern that, considering the pace of economic recovery after COVID-19, the climate response gap between developed and developing countries could deepen day by day.

Meanwhile, the event was attended by Chairman Eun, Minister of Environment Han Jeong-ae, Chairman of the Korea Development Bank Lee Dong-geol, and Chairman of the National Pension Service Kim Yong-jin. Representatives from international organizations and companies related to climate environment and finance, including the United Nations Framework Convention on Climate Change (UNFCCC), World Economic Forum (WEF), International Finance Corporation (IFC), Bank for International Settlements (BIS), European Investment Bank (EIB), Task Force on Climate-related Financial Disclosures (TCFD), Green Climate Fund (GCF), and Global Green Growth Institute (GGGI), also participated.

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