Cooperation between the National Bank and the EIB to support green finance

Skopje, 21 February 2024

The National Bank and the European Investment Bank (EIB) signed a Cooperation Agreement today, aimed to provide support to the National Bank efforts in greening finance. The agreement was signed by Governor Anita Angelovska Bezhoska and Björn Gabriel, EIB representative to our country, in the presence of the EU Ambassador David Geer, the ambassador of the Federal Republic of Germany, H.E. Petra Drexler, and the National Bank team.

The cooperation between the two institutions includes consultancy support for the central bank for further improvement of the regulatory and supervisory framework of climate risk management, as well as building of the capacities for reporting, collecting and processing green finance data. These activities aim to increase the banks' understanding of the exposure of the corporations to climate-related risks and to support sustainable practices. The cooperation will take place within the EIB Greening Financial Systems Programme.

The Governor pointed out that since 2020, the National Bank has been taking measures and activities to encourage financing of the green transformation of our economy. "Measures and activities taken so far by the National Bank to encourage green financing, as well as the future steps, have been contained in the first National Bank's Medium-Term Climate Change Action Plan. The implementation of the medium-term action plan has already started. Recently, the National Bank has adopted Guidelines on Managing Climate-Related Risks for banks to strengthen the resilience of the banking system to climate risks. The initial analyses of the assessment of the banking system exposure to physical and transition climate-related risks, which rely on the relevant available data, are particularly significant and expected to be proliferated in the period ahead, along with the preparation of a Review of Green Growth Indicators", said Angelovska Bezhoska.

EIB Vice-President Kyriacos Kakouris, who is responsible for operations in North Macedonia, said: "As part of Team Europe, we are delighted to be an active contributor to North Macedonia's green transition and sustainability goals. The agreement with the National Bank is based on excellent collaboration established in the last few years. It complements other EIB activities in North Macedonia such as the 'green' credit line signed in 2023 with the Development Bank of North Macedonia (DBNM), as well as sustainable transportation, energy efficiency and environmental protection projects under the Economic and Investment Plan. These activities bear great importance for North Macedonia, which aims to become part of the EU family and aligns its activities with the Green Agenda and the Paris Agreement."

German Ambassador to North Macedonia Petra Drexler stated: "There are three features which are particularly suitable to describe current German-Macedonian relations: firmly European, economically viable, climate-oriented. The Greening Financial Systems programme illustrates this perfectly. The financial sector plays a crucial role in bringing us closer to a sustainable, resilient, resource-conserving global economy. Without investment in climate resilience, sustainable economies will not be possible in the future. Therefore, climate action is a fundamental pillar of German foreign policy. I am grateful to the European Investment Bank and the National Bank of North Macedonia for being our partners in this endeavour."

Head of the EU Delegation to North Macedonia, Ambassador David Geer, remarked: "Financial institutions and regulators can play an important role in actions to combat climate change. By providing tailored technical assistance to the National Bank of North Macedonia and local commercial banks, this programme will help develop efficient green lending and investment in North Macedonia, thereby contributing to the country's climate goals."

The EIB's Greening Financial Systems Programme provides technical assistance for building financial systems resilience to climate-related risks, with the ultimate goal of supporting the private sector in the process of channeling available funds into climate and environmentally sustainable investments. The Programme is funded by the EIB's International Climate Initiative Fund on behalf of the German Federal Ministry of Economic Affairs and Climate Action ("BMWK"). It is BMWK's and EIB's joint contribution to the work of the NDC Partnership, specifically the "Readiness support for greening central banks" initiative and the national commitments of the RNM.

In the meeting, it was concluded that inter-institutional cooperation, coordinated national approach and the building of systems for greater resilience and damage mitigation were profound for dealing with climate change as one of the most severe risks worldwide, both in short and long term. The role of international financial institutions and their readiness to support is of paramount importance for our country.