MUSCAT: A national roadmap for unlocking new sources of sustainable funding for the financing of green projects in the Sultanate of Oman envisions a key role for the non-banking financial sector, according to a top official of the Capital Market Authority (CMA).
Abdullah Salim al Salmi, Executive President, said CMA Board of Directors has approved a strategy that will see non-banking financial companies (NBFCs) gearing up to support the green finance requirements of the Omani economy.
Writing in ‘Wealth’, the newsletter of the Ministry of Energy and Minerals, Al Salmi said the roadmap – planned for implementation in three phases – also envisages initiatives to strengthen regulatory frameworks around green finance, support capacity-building within the Authority, enhance disclosure guidelines, improve transparency, and champion a pivot to green and sustainable financial instruments.
Over the last decade and a half, global sustainable and green finance has grown exponentially, spurred by the growth of financial instruments, such as “green bonds, green loans, green investment funds, green insurance, and green Sukuk,” said Al Salmi. Complementing this portfolio are social bonds, sustainable Sukuk and other such instruments, he noted.
Sustainable and green finance, he pointed out, helps achieve “economic development by eliminating pollution and emissions of greenhouse gases, decreasing waste to the minimum level, and improving the efficiency of using natural resources”.
The national roadmap is designed to spur the achievement of three key goals: Encourage NBFCs to roll out innovative financing products for green projects; Support the funding of projects that will contribute to Oman’s Net Zero targets; and Embed ESG principles in the implementation of green projects.
“All this entails the need for providing regulatory frameworks and an enabling environment to attract green and sustainable investment in the nonbanking sector to guarantee that this type of fund is governed, managed, and improved in accordance with the best international practices,” said Al Salmi.
To this end, the CMA is drafting a regulatory framework to support the issuance of green finance in the form of traditional or innovative bonds, as well as Sukuk. The regulations will also come with guidelines for ESG disclosure, registration of suitably qualified auditors, and other prerequisites necessary to align these laws with international benchmarks for green and sustainable finance, he added.
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