Page 16 - Green Finance 2024

- Promote economic transition towards sustainability, including: (1) Economic growth

and job creation: Green finance is crucial in facilitating the shift from traditional, carbon-

intensive industries to sustainable practices, which is essential for achieving global
climate targets and promoting ecological resilience. This transition is expected not only

to mitigate environmental risks but also to spur economic growth through the creation

of new industries and job opportunities. According to a report by the International

Renewable Energy Agency (IRENA), the renewable energy sector alone could employ

more than 42 million in the renewable energy sector, 21 million in energy efficiency
and almost 15 million in power grid and energy flexibility (IRENA, 2020). This potential

for job creation spans across various sectors including energy, manufacturing, and

services, all of which benefit from investments in green technologies; (2) Innovation and

competitive advantage: Investing in green finance encourages innovation by funding

new technologies and business models that contribute to environmental sustainability.
Companies that adopt green practices often gain a competitive advantage by improving

efficiency, reducing costs, and meeting the growing consumer demand for sustainable

products. This competitive edge is crucial for businesses in a global market where

environmental concerns are increasingly influencing consumer choices and regulatory

frameworks; and (3) Financial market diversification and stability: Green finance
contributes to financial market stability by diversifying investment portfolios.

Investments in green assets are often less correlated with traditional financial products,

providing a hedge against economic downturns. Moreover, these investments tend to

attract long-term commitments, which enhance financial stability and reduce volatility.

The growth of green finance markets also facilitates the development of new financial
instruments and asset classes, broadening opportunities for investors.

- Enhancing public health and quality of life: Green finance plays a pivotal role in

improving public health and overall quality of life by reducing environmental pollution

and enhancing the resilience of communities to climate change. Investments in green
infrastructure, such as clean water services, sustainable urban transport, and green

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