TheJakartaPost
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The pandemic, G20 and sustainable investment
The pandemic's silver lining for finance is increased demand for sustainable investment and drive toward the green transition as a means for economies around the world to recover stronger.
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Indonesia has begun to tap into the green bond market, both at home and overseas, to finance environmentally friendly projects. (Shutterstock/File)
It has been two years since the COVID-19 pandemic. This global crisis has affected various aspects of society, not only health but also education and the economy.
On the health side, there has been an increase in health expenditures, even deaths. Education is disrupted because face-to-face learning is restricted. On the economic side, growth has slowed as a result of reduced income, production and consumption that mainly affects the vulnerable and the poor.
However, as the saying goes, “There is wisdom behind calamities,” and the pandemic has opened our eyes to the fact that environmental, social and governance (ESG) aspects have an impact on the economy and financial markets.
Since the COVID-19 pandemic, there has been an increase in demand for investment products that take ESG into account, or sustainable investments.
This should be welcomed, considering that sustainable investment will have a positive impact on the environment and long-term development.
Indonesia, which holds the Group of 20 (G20) presidency this year, should take advantage of this moment to promote sustainable investment as a priority issue. There are three reasons why it is appropriate to support the G20 discussions on sustainable investment.
First, sustainable investment pays attention to social and environmental aspects, so it can offer a solution to the current pandemic as well as and future pandemics. Sustainable investment is appropriate for Indonesia’s G20 presidency to pursue as a strategy to remove the impacts of the pandemic from the global economy toward a resilient economy and sustainable financing.
