Analytical Assessment of Green Digital Finance Progress in the Republic of Georgia
Date Issued
2022
Author(s)
Gurbanov, Sarvar
Suleymanli, Farahim
Abstract
Estimations show that approximately US $23 billion is required for
Georgia to meet its climate and environmental targets up to 2030. As the current
Nationally Determined Contribution reveals, considering 1990 as a base year, the
Republic of Georgia plans a 35% decrease in greenhouse gas emissions by 2030.
If the country has financial and technical support, commitment to limit emissions
may rise as high as 50–57%. As part of the Paris Climate accord, developed nations
pledged to channel US $100 billion toward low-income countries between 2020
and 2025. Recent estimates by the OECD show that developed nations will be able
to reach their US $100 billion pledge only in 2023. Considering this lag for many
developing countries, including Georgia, mobilizing private finance via green digital
finance will be vital. The policymakers of the Republic of Georgia are very ambitious about adopting green digital finance solutions. This initiative has potential to
fill the gap in public funding sources. Hence, this study analyzes the potential for
private sector financing through the digitization of green finance. The current study
illustrates the extent to which green finance and its digitization level are available in
the Republic of Georgia. The major policy implication is that the country faces unintended consequences even though there is a robust regulatory attempt to mobilize
private financial sources. This case study is relevant for many developing countries
for drawing lessons on better policymaking.
Georgia to meet its climate and environmental targets up to 2030. As the current
Nationally Determined Contribution reveals, considering 1990 as a base year, the
Republic of Georgia plans a 35% decrease in greenhouse gas emissions by 2030.
If the country has financial and technical support, commitment to limit emissions
may rise as high as 50–57%. As part of the Paris Climate accord, developed nations
pledged to channel US $100 billion toward low-income countries between 2020
and 2025. Recent estimates by the OECD show that developed nations will be able
to reach their US $100 billion pledge only in 2023. Considering this lag for many
developing countries, including Georgia, mobilizing private finance via green digital
finance will be vital. The policymakers of the Republic of Georgia are very ambitious about adopting green digital finance solutions. This initiative has potential to
fill the gap in public funding sources. Hence, this study analyzes the potential for
private sector financing through the digitization of green finance. The current study
illustrates the extent to which green finance and its digitization level are available in
the Republic of Georgia. The major policy implication is that the country faces unintended consequences even though there is a robust regulatory attempt to mobilize
private financial sources. This case study is relevant for many developing countries
for drawing lessons on better policymaking.