Page 289 - Ebook HTKH 2024

private sector involvement and said that the private sector plays a crucial role in driving
sustainable finance by shifting finance flow away from unsustainable activities and

towards climate resilient business models.
Green finance benefits multiple other sectors of the economy. These benefits from
green finance are also urging the world to pay more attention to the development of this
form of financing. The demand for green financing is increasing over time and green
financing development is also getting more attention in ASEAN. Apart from the
introduction and conclusion, the paper is arranged as follows. Section 1 outlines the
concept and current status of ASEAN's green finance development. Solutions for
increasing green finance development in ASEAN are discussed in Section 2.

Experienced lessons for Vietnam are drawn in section 3.
2. Concept and current status of ASEAN's green finance development
Green finance is financial support aimed at green growth through cutting
greenhouse gas emissions and environmental pollution. According to the United Nations
Environment Program (UNEP), green finance is to increase the level of financial flows
(banking, microcredit, insurance and investment) from the public, private and non-profit

sectors to sustainable development priorities.
Green finance refers to financing instruments, investment and mechanisms that
contribute to a “climate plus” approach, impacting both climate and environmental
sustainability goals. Green finance thus targets (i) a reduction in greenhouse gasses and
improved climate resilience; (ii) improved environmental objectives such as air and
water quality, ecosystems and biodiversity, and resource use efficiency.
The purpose of green finance is to reduce greenhouse gas emissions, increase

resilience to climate change and improve the ability to protect the environment, air
quality, water quality, ecosystems and biodiversity. Green finance helps prevent the
impact of climate change by financing energy efficiency and renewable energy projects.
Green finance is a narrower concept than sustainable finance, but broader than
climate and low carbon finance (Figure). Sustainable finance can be used to finance
projects with environmental, social, economic benefits; as well as benefits to other

SDGs. Green finance can be used to finance projects only with environmental benefits,
which include climate change mitigation, climate change adaptation and other
environmental benefits.

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