Fiji has officially introduced its Green Finance Taxonomy, a significant achievement aimed at enhancing environmentally sustainable economic activities within the nation. The framework was unveiled last week by Finance Minister Esrom Immanuel, developed under the guidance of the Reserve Bank of Fiji (RBF) with assistance from the International Finance Corporation and the Climate Bonds Initiative.
RBF Governor Arif Ali emphasized the importance of this taxonomy in his introduction to the document, describing it as a science-based classification system tailored to Fiji’s unique context while also aligning with global best practices. The taxonomy seeks to clearly define and label green and sustainable investments, empowering investors, financial institutions, and policymakers to channel financial resources towards projects that promote Fiji’s climate and development objectives.
The framework initially concentrates on critical sectors such as energy and transport, both significant contributors to Fiji’s greenhouse gas emissions. Governor Ali explained that it employs a traffic light system where activities are categorized as green (aligned), amber (transition), or red (ineligible), based on scientifically established screening criteria along with robust social safeguards.
This innovative framework not only aims to enhance transparency and prevent greenwashing but also seeks to foster the development of new green financial products. The Taxonomy plays a crucial role in supporting Fiji’s ambitious aims, including the goal of achieving net-zero emissions by 2050 and transitioning to 100% renewable energy in the electricity sector by 2035.
The current version of the Taxonomy is primarily focused on mitigation strategies within the energy and transport sectors, with plans for future expansions to include adaptation and resilience measures as well as other environmental objectives. This approach positions the Taxonomy as a ‘living document’ that will be continually revisited to incorporate the latest advancements in science, technology, policy, and market trends, reflecting Fiji’s commitment to environmental sustainability and climate resilience.