BI Boss: ASEAN Central Bank Not Only Promotion Of Green Financial Transition

Governor of Bank Indonesia Perry Warjiyo (Photo: Doc. Antanews)

JAKARTA - Bank Indonesia (BI) Governor Perry Warjiyo stated that ASEAN Central Bank plays an important role in supporting the implementation of the green financial transition.

This was stated in the ASEAN 2023 Seminar High Level event entitled 'Aligning Policies for Climate Transition'.

"The role of the central bank is not only to promote or focus on the green transition, but to support the transition, especially the green financial transition," Perry said, quoting Antara.

This step is needed in line with various global initiatives that continue to run according to the green transition. In fact, several governors of the world's central bank continue to discuss reforestation of the financial sector together.

ASEAN Central Bank support in the green financial transition can be done in various ways. He gave an example, like BI which issued macroprudential policies in supporting green and sustainable development, including providing incentives in the form of increasing liquidity for banks that provide financing to green projects.

BI also issued a Loan to Value (LTV) ratio policy of 100 percent for banks that finance green projects.

Perry added that his party also provides technical assistance and capacity development through workshops for preparation and financing development projects to local governments (Pemda).

"We are taking this step through our 46 branches across the country. We give advice on preparations that will be important for the green project to the local government," he explained.

In line with BI's general policy, he said that his party also adopted a sustainable and responsible investment strategy (SRI).

In addition, BI's foreign exchange management is also invested in confirmed assets in green and sustainable finance.

"In this case, we also have a portfolio in the social sector and the use of sustainable Islamic bonds or sukuk," said Perry.