G20 published an official statement, also known as the Communiqué, summarizing developments at the February meeting of the finance ministers and central bank governors in Jakarta, Indonesia. G20 welcomed the work done by international bodies in the areas of financial resilience, central bank digital currencies, sustainable finance instruments, climate-related financial risks, crypto-asset markets, and money laundering and terrorist financing.
The G20 leaders reaffirmed that they will continue to monitor major global risks, including from geopolitical tensions that are arising, along with the macroeconomic and financial vulnerabilities. G20 reiterated its commitment to strengthen long-term financial resilience of the international financial architecture, including promoting sustainable capital flows and developing local currency capital markets. It will continue its discussion on Central Bank Digital Currencies, to further understand their macro-financial implications for the international monetary and financial system, including for spillovers and capital flows. The Communiqué states that G20 will scale up sustainable finance markets and improve access for countries and firms, including for developing economies and small and medium-size enterprises (SMEs), in an affordable way. G20 will take forward actions of the G20 Sustainable Finance Roadmap, which includes reporting and assessment of priorities set out in the 2022 G20 Sustainable Finance Report. In addition, Sustainable Finance Working Group (SFWG) will develop a voluntary, non-binding policy toolbox highlighting ways to scale up sustainable finance instruments (SFI), in cooperation with other relevant G20 working groups, with a focus on improving accessibility and affordability. Collaboration between the government and authorities will be improved to develop an ecosystem that maintains long-term SFI continuity in the market.
G20 also addressed work of the Financial Stability Board (FSB) on exit strategies and scarring effects in the financial sector; supported the continued implementation of the G20 Roadmap for Enhancing Cross-Border Payments, including monitoring progress toward the roadmap's quantitative targets; and looks forward to further progress in taking forward the actions of the FSB Roadmap for Addressing Climate-Related Financial Risks. G20 welcomes the FSB's updated assessment of financial stability risks from fast-evolving crypto-asset markets. It encouraged FSB and other standard-setting bodies to monitor and share information on regulatory and supervisory approaches to unbacked crypto-assets, stablecoins, decentralized finance, and other forms of crypto-assets and to address any gaps and arbitrage, including by recommending coordinated and timely policy actions to preserve global financial stability. It also welcomed the continued focus of the Financial Action Taskforce on the risks and opportunities of the digital transformation for preventing and combating money laundering, terrorist financing, and proliferation financing.
Keywords: International, Banking, Sustainable Finance, Climate Change Risk, Crypto Assets, CBDC, ML TF Risk, Stablecoins, Cyber Risk, G20
Dr. Denton provides industry leadership in the quantification of sustainability issues, climate risk, trade credit and emerging lending risks. His deep foundations in market and credit risk provide critical perspectives on how climate/sustainability risks can be measured, communicated and used to drive commercial opportunities, policy, strategy, and compliance. He supports corporate clients and financial institutions in leveraging Moody’s tools and capabilities to improve decision-making and compliance capabilities, with particular focus on the energy, agriculture and physical commodities industries.
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