Economy 17 May 2021, 11:40am

Hungary central bank welcomes G30 report on transition to net-zero economy

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The National Bank of Hungary (MNB) has welcomed a report by the G30 titled Mainstreaming the Transition to a Net Zero Economy. Treating climate change as one of its top priorities, the MNB has just published its response to the Group of 30’s recommendations and is open to further dialogue regarding the green transition.

The MNB welcomes the October 2020 report of the Group of Thirty (G30) titled Mainstreaming the Transition to a Net Zero Economy. The G30 report outlines recommendations for governments, companies, financial institutions, and central banks on how the transition can be accelerated.

The recommendations pertaining to central banks resonates well with MNB, which, since the launch of its Green Program, has implemented numerous policies and projects related to the mitigation of climate change and the green transition.

Inspired by the G30 report, the MNB is ready to take further steps in line with the G30 recommendations and is open to further dialogue with the G30 Steering Committee, the G30’s Working Group on Climate Change and Finance and other like-minded institutions.

The MNB’s response to the Group of 30’s recommendations is available here.

The Hungarian central bank believes that the most adverse effects of climate change can only be avoided if the global economic system reaches carbon neutrality as soon as possible. However, the transition will not take place by itself. Immediate and holistic action is required from policymakers, regulators, financiers, and the corporate world.

In the beginning of 2019, the MNB launched its Green Program, which embedded environmental sustainability in the central bank’s strategy. After having introduced incentives to encourage green lending in 2020, another milestone was reached in March 2021, when the MNB published its first Green Finance Report providing a comprehensive picture of the environmental sustainability of the Hungarian economy and, in particular the financial system. More recently, on 21 April 2021, the MNB committed to carbon neutrality and also issued its new supervisory recommendations for credit institutions on climate-related and environmental risks. Regarding future milestones: in line with the G30’s recommendations, the MNB is preparing for disclosures aligned with the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD).